Managing Profitable Customer Relationships
Definition
a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging value with others
Attracting new customers
Retaining and growing current customers
Marketing Process
- Understand marketplace and cutomer needs/wants
- Design customer value driven marketing strategies
- Construct integrated marketing program that delivers superior value
- Build profitable relationships and create customer delights
- Capture value from customer to create profit and custoer equity
Core Concepts of Marketing
Needs
basic part of human life
(Not created by marketer)
eg: Need food, cloth, safety
Wants
needs shaped by culture and the individual
eg: Want a Big Mac, fries and soft drinks
Demands
Wants which are backed by buying power
eg: Burger King vs Ramly Burger
Marketing offers
Combination of products, services, infos / experiences that satisfy a need or want
Offer may inc. : services, information or ideas
Value and satisfaction
Marketers must deliver value to consumers
Customers form expectations about the value
dissatisfied, satisfied and delighted customer
Exchange, transaction and relationship
Exchange : act of obtaining a desired object from someone by offering something in return
Transactions : trade of values between two parties
Market
Set of actual and potential buyers of a product
Marketers seek buyers that are profitable
Marketing Management
art and science of choosing target markets and building profitable relationships with them
Production concept
Consumer: favor products that available and highly affordable
Management: focus on improving production/distribution efficiency
eg: mineral water,salt
Product concept
Consumer: will favor products that offer the most quality, performance and innovative features
Marketing strategies: making continuous product improvements
eg: Ex: shampoo, mousetraps, cameras, handphones
Selling concept
Consumer: not buy enough of firm’s product unless undertakes large-scale selling or more promotion effort
Marketing strategies:if the company faces overcapacity, aim to sell what they make rather than the market wants
From factory -> existing product -> selling/promoting -> profits through sales volume
Marketing concept
Company goal: knowing the needs/wants of target markets and delivering the desired satisfaction better than competitor’s do
From market -> customer needs -> integrated marketing -> profits through customer satisfaction
The Societal-Marketing concept
See the conflicts between consumer short run wants and consumer long run welfare
marketing strategies: company profit, consumer wants and society interests.
Stress the honesty, integrity and putting the consumer first before gain the profit
Marketing Mix
Product
goods and services the company offers to the target markets
quality, design, features, brand name
Price
amount of money customers have to pay to obtain the
product
Place
company activities that make the product available to target consumers
Promotion
channels, locations, coverage
activities that communicate the merits of the product and persuade target customers to buy it
Building Customer Relationships
Customer Relationship Management (CRM): overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.
Managing Customer Relationships and Capturing Customer Value
Customer perceived value
diff between total customer benefits & customer cost
Customer satisfaction
extent to which perceived performance matches a buyer's expectations
Customer-Engagement Marketing
fosters direct and continuous customer involvement in shaping brand conversations, experiences, and community.
Consumer-Generated Marketing
Brand exchanges created by consumers themselves. Consumers are playing an increasing role in shaping brand experiences
Partner relationship management working closely with partners in other company departments and outside the company to jointly bring greater value to customers.
Customer lifetime value the value of the entire stream of purchases that the customer would make over a lifetime of patronage
Customer equity total combined customer lifetime values of all of the company’s customers
The Changing Marketing Landscape
Marketing Challenges
digital age
globalization
ethics & social responsibility
not-for-profit-marketing
marketing relationships