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Midterm Exam Notes.docx

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Concordia University
COMM 320

aCHAPTER 1Marketing Creating and Capturing Customer ValueMarketingProcess of building profitable customer relationships by creating value for customers and capturing value in returnThe activity set of institutions and processes for creating communicating delivering and exchanging offerings that have value for customers clients partners and society at large ie stakeholdersgoal attract new customers by promising superior valuekeep and grow current customers by delivering satisfaction satisfying customer needs in a socially responsible and ethnical mannerThe Marketing Process1Understand Marketplace and Customer Needs2Design customerdriven marketing strategy3Construct a marketing program that delivers superior value4Build profitable relationships and create customer delight5Capture value from customers to create profits and customer equity1 Understand Marketplace and Customer Needsunderstand marketplace that they operate needswants5 core customer and marketplace concepts1Needsstates of felt deprivation when person feels physiologically deprived of basic necessitieseg physical food clothing shelter Social belonging and affection Individual knowledge etcWantsa felt need that is shaped by persons knowledge culture and personality eg need for food want hamburgerobjects that will satisfy needsMarketers jobinform consumers how products can satisfy their needs and wantsoDoesnt create need but shape persons wantsDemandswants that are back by buying power given wants and resources ppl demand products w benefits that add up to the most value and satisfaction2Market offerings some combo of products services info or experiences offered to a market to satisfy need or wantMarketing myopiamistake of paying more attention to specific products company offers than to the benefits and experiences produced by these products3Value and satisfactionkey building blocks for developing managing customer relationships4Exchangesact of obtaining a desired object from someone by offering something in returnmarketing occurs when ppl decide to satisfy needswants through exchange relationships5Marketsthe set of actual and potential buyers of a productservice these buyers share a particular needwant that can be satisfied through exchange relationships2 Design a CustomerDriven Marketing StrategyMarketing managementart and science of choosing target markets and building profitable relationships with them design a customerdriven marketing strategy once consumers and marketplace is understoodMust answer 2 questions whats our target market Whats our value propositionMarket segmentationdividing the markets into segments of customersTarget Marketwhich segments to go after decide who to serve by market segmentation select target marketDemarketingmarketing to reduce demand temporarilypermanently not2 destroy demand but reduceshift itValue propositionhow itll differentiate and position itself in marketplace set of benefitsvalues it promises to deliver to consumers to satisfy their needsMarketing Management Orientations 5 concepts to designing Marketing Strategies1Production conceptidea that consumers will favour products that are available highly affordable Therefore org should focus on improving production and distribution efficiency eg low labour cost high production efficiency mass distribution etc2Product Conceptidea that consumers will favour products that offer the most quality performance and innovative features Therefore org should focus on making continuous product improvements3Selling Conceptidea that consumers wont buy enough of firms products unless it undertakes largescale selling and promotion efforts goods that buyers dont normally think of buying eg insuranceAim sell what company makes rather than making what market wants insideout focus4Marketing Conceptachieving org goals depends on knowing the needs and wants of target markets and delivering desired satisfactions better than competitors do Focus on customer value outsidein5Societal Marketing Concept orgs marketing decisions must consider consumers wants companys requirements consumers longrun interests and societys longrun interest considers society human welfare consumer want satisfaction company profit3 Construct a marketing program that delivers intended value to target customersMust blend all marketing mix 4Ps into integrated marketing program that communicates and delivers the intended value to chosen customers4 Build Customer RelationshipsCustomer Relationship Managementoverall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction acquiring keeping and growing customersKey to lasting customer relationships is create superior customer value satisfactionCustomerperceived valuecustomers evaluation of difference between all benefits and all costs of a market offering relative to those of competing offers CPVtotal customer valuetotal customer costCustomer satisfactionthe extent of how well products perceived performance matches buyers expectationsChanging Nature of Customer RelationshipsRelating with more carefully selected customers selective relationships management to target fewer more profitable customersRelating more deeply and interactively by incorporating more interactive 2way relationships ie blogs websites online communities and social networksConsumergenerated marketingmarketing messages ads and other brand exchanges created by consumers themselves through blogs websites etcPartner relationship managementworking closely w partners in other company departments outside org to jointly bring greater value to customers5 Capturing Value from Customers gains sales market share profit outcome of creating customer value1Creates customer loyalty delight and retention captures Customer lifetime valuevalue of entire stream of purchases that customer would make over a lifetime of patronage2Grows Share of Customerportion of customers purchasing that a company gets in its product categories3Builds Customer Equitytotal combined customer lifetime values of all of the companys current and potential customers the more loyal the firms profitable customers the higher firms customer equity a good measure of firms performanceWhich customer should company acquire and retainclassify customers according to potential profitability manage its relationship w them accordinglyMarketing Process
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