Transcript Options for Organizing Small and Large Businesses

Chapter
11
Customer-Driven Marketing
Learning Objectives
1
Define marketing.
Discuss the evolution of the marketing
2 concept.
5
Describe marketing research.
6
Discuss market segmentation.
3
Describe not-for-profit marketing and
nontraditional marketing.
Summarize consumer behavior.
7
Outline the basic steps in developing a
4 marketing strategy.
8
Discuss relationship marketing.
What Is Marketing?
Marketing- set of processes for creating,
communicating, and delivering value to customers and
for managing customer relationships in ways that benefit
the organization and its stakeholders.
Marketing begins with discovering unmet customer needs and
continues with researching the potential market; producing a good
or service capable of satisfying the targeted customers; and
promoting, pricing, and distributing that good or service.
Throughout the entire marketing process, a successful organization
focuses on building customer relationships.
The best marketers not only give consumers what they want but
even anticipate consumers’ needs before those needs surface.
Exchange process- activity in which two or more parties
give something of value to each other to satisfy
perceived needs.
How Marketing Creates Utility
Utility: power of a good or service to satisfy a
want or need
Create time utility by making a good or service
available when customers want to purchase it.
Create place utility by making a product
available in a location convenient for customers.
Create ownership utility through an orderly
transfer of goods and services from the seller to
the buyer.
Evolution of the Marketing Concept
Emergence of the Marketing
Concept
Marketing concept- company-wide
consumer orientation to promote long-run
success.
Firm starts with analysis of customers’ needs
and works backward to offer products that
fulfill them.
Explained by shift from sellers’ market in
which goods and services are relatively
scarce to buyers’ market in which they are
relatively plentiful.
Not-for-Profit Marketing
20 million not-for-profits exist worldwide.
Apply marketing tools to reach audiences, secure
funding, improve their images, and accomplish
their overall missions.
Not-for-profit organizations operate in both public
and private sectors.
Sometimes partner with a profit-seeking company
to promote a message.
Non-Traditional Marketing
Developing a Marketing Strategy
1. Study and analyze
potential target
markets and choose
among them.
2. Create a marketing
mix to satisfy the
chosen market.
Selecting a Target Market
Target market- group of people toward whom an
organization markets its goods, services, or ideas
with a strategy designed to satisfy their specific
needs and preferences.
Types of Markets
consumer (B2C) product: good or service that is
purchased by end users
business (B2B) product: good or service purchased to be
used, either directly or indirectly, in the production of
other goods for resale
Marketing Mix
Marketing Mix blends the four strategies to fit the
needs and preferences of a specific target market.
→ Product strategy involves the nature of the product and its
package design, brand names, trademarks, and product
image.
→ Distribution strategy ensures that customers receive their
purchases in the proper quantities at the right times and
locations.
→ Promotional strategy blends advertising, personal selling,
sales promotion, and public relations to achieve its goals of
informing, persuading, and influencing purchase decisions.
→ Pricing strategy is setting profitable and justifiable prices for
the firm’s product offerings, sometimes subject to government
scrutiny.
Marketing Mix for International
Markets
Standardization- offering the same marketing
mix in every market.
Adaptation- developing a unique marketing
mix to fit each market’s local competitive
conditions, consumer preferences, and
government regulations.
Mass customization- allows a firm to mass
produce goods and services while adding
unique features to individual or small groups of
orders.
Marketing Research
Marketing research– the process of collecting and
evaluating information to support marketing decision
making. AC Nielson– Consumer Research
Secondary data– Previously published data from trade
associations, advertising agencies, marketing research
firms, and other sources.
Primary data– Data collected through observation,
surveys, and other forms of observational study.
Data mining– computer searches of customer data to
detect patterns and relationships.
Business intelligence– activities and technologies for
gathering, storing, and analyzing data to make better
competitive decisions
Market Segmentation
Market segmentation– the process of dividing a total
market into several relatively homogeneous groups.
How Market Segmentation Works
Segmenting Consumer Markets
Geographic Segmentation
Divides market into homogeneous groups on the basis of their
locations.
Demographic Segmentation
Divides market on the basis of various demographic or socioeconomic
characteristics: gender, income, age, occupation, household size,
stage in the family life cycle, education, and ethnic group
Psychographic Segmentation
Divides consumer market into groups with similar psychological
characteristics, values, and lifestyles. (VALS)
AIO statements—people’s verbal descriptions of various attitudes, interests,
and opinions
Product-Related Segmentation
Divides market based on buyer’s relationship to the good or service.
based on benefits sought by buyers, usage rates, and loyalty levels
Segmenting Business Markets
Geographic segmentation– targets
geographically concentrated industries.
Demographic, or customer-based,
segmentation– a good or service
intended for a specific organizational
market (i.e. healthcare).
End-use segmentation– focuses on
the precise way a B2B purchaser will
use a product.
Determining What Customers Want
Consumer behavior- actions of ultimate
consumers directly involved in obtaining,
consuming, and disposing of products and the
decision processes that precede and follow these
actions.
Personal factors: needs and motives, perceptions,
attitudes, self-concept
Interpersonal factors: cultural, social, and family
influences
External factors: economic events
Business buying behavior- often includes a
variety of influences from multiple decision makers.
Steps in Consumer Behavior
Relationship Marketing
Relationship marketing- developing and
maintaining long-term, cost-effective exchange
relationships with partners.
Consumers enter into relationships only if
there is some benefit to them.
Relationship marketing seeks to achieve
customer satisfaction.
Benefits of Relationship Marketing
Lower costs and higher profits for the business.
Efficient targeting of best customers increases the
lifetime value of a customer.
revenues and intangible benefits (referrals and
customer feedback) from a customer over the life of
the relationship, minus the amount the company must
spend to acquire and serve that customer.
Stronger relationships with business partners and
opportunities to combine capabilities and
resources to better accomplish goals.
Tools for Nurturing Customer
Relationships
80/20 principle: frequent customers have a
higher lifetime value, so businesses allocate
resources accordingly
Frequency marketing: reward purchasers with
cash, rebates, and other premiums (TGI Fridays
reward program)
Affinity programs: solicit involvement based on
common interest
Comarketing: businesses jointly market each
others’ products
Cobranding: firms link their names in a single
product
One-to-One Marketing
Customizing products and marketing and
rapidly delivering goods.
Customer relationship management
software helps companies gather, sort, and
interpret data about specific customers.