COMM 131 Study Guide - Final Guide: Brand Equity, Customer Retention, Operant Conditioning

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Published on 16 Apr 2013
School
Queen's University
Department
Commerce
Course
COMM 131
Professor
1
COMM 131 Final Exam Review Notes
Session 1 Marketing: Creating and Capturing Customer Value
What is marketing?
Marketing is managing profitable customer relationships.
A social and managerial process, allowing parties to satisfy wants and needs through creating and exchanging value.
Fundamentally, marketing includes two core activities:
1. Attract new customers by offering superior value than competitors.
Value = Perceived Benefit Perceived Costs
2. Keep and grow current customers by delivering satisfaction and building long-term relationships with customers.
Marketing Strategy (Who to sell to)
The process whereby a company determines who to serve, and how to serve them best
STP Segmentation, targeting, positioning
Five steps involved in the marketing process:
o Understand the market’s wants and needs
o Design a customer-driven marketing strategy
o Construct an integrated marketing program that delivers superior value
o Build profitable relationships and increase customer delight
o End result: capturing value for customers, create profits, build customer equity
Marketing Tactics (How to sell)
Collection of marketing activities that together accomplish the larger goal of satisfying customer needs and building customer
relationships
4 P’s Product, Price, Place (Distribution), Promotion
Market Set of actual and potential buyers of a product or service.
Need State of felt deprivation including physical, social and individual needs.
Wants Specific form of a need that is shaped by culture and personality. The choices we make to fulfill our needs.
Demand A ‘Want’ backed by buying power.
Market Offerings Some combination of products, services, information or experiences, etc. offered to a market to satisfy a need or
want.
Marketing Myopia
Phenomenon where businesses can forget what ‘business’ they are in.
o Businesses must always keep their focus on satisfying the needs of customers, rather than focusing on satisfying
accompanying benefits.
o Example: Kodak focused on producing film, rather than ensuring they maintained at the forefront of the industry of
“capturing life’s moments”
Implications: Companies must continuously evolve and adapt to the demands of the marketplace.
o “Lead customers where they want to go, before they know where they want to
Session Three Customer Value and Marketing Planning
Customer Driven Marketing Strategy
Marketing management is the art and science of choosing target markets and building profitable relationships with them.
Role of marketing management (ADCS):
o Analyze customer markets (needs and wants)
o Design marketing strategy
o Communicate value proposition
o Serve customers (before, during and after purchasing process)
Two key questions (answer to these questions comprise a Marketing Plan):
1. What customers to serve?
2. How can we serve them best?
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Selecting Customers to Serve
Marketing segmentation involves dividing the market into segments of plausible customers.
o Segments should be homogenous within and heterogeneous without
Target marketing involves selecting the best segment to cultivate to grow demand or even reduce demand (de-market).
Choosing a Value Proposition (Or how do we serve customers best?)
The set of benefits that the marketer promises to deliver to customers to satisfy their needs.
o Here is what we can do for you… differentiation
The proposition must (answer the questions: what benefits do your products have over competitors):
o Differentiate this value proposition from the competition
o Build customer value and satisfaction through the offer
Positioning:
o Arranging for a product to have a clear, distinctive and desirable place relative to competing products in the minds of
consumers.
o Essentially answers the question: “Why should I choose your brand rather than a competitor’s?”
Integrated Marketing
o Employing all elements of the marketing mix to support value proposition and reach goals of the marketing program
o Will align and incorporate all four elements of the marketing mix to have a clear, consistent message
o Marketing Mix: The Four P’s
Marketing Management Philosophies
Production Concept more products, more outliers, more buyers maximize production, push product
o Management focus: improve production and distribution efficiency
Product Concept better product, more buyers goal of producing the best product
o Continuous product improvement is required
Selling Concept making a lot of something and telling a lot of people will allow you to sell a lot persuade consumers to buy
o Large-scale selling and promotion strategy
Marketing Concept knowing consumers wants and needs building relationships based on satisfaction
o Must be better than that of competitors
Societal Marketing Concept people, profit, planet value to customers and society
o Marketing decisions should consider consumer’s wants, the company’s requirements, consumers’ long-run interests, and
society’s long-run interests
Customer Relationship Management
The overall process of building and maintaining profitable customer relationships by delivering superior customer value and
satisfaction
o Note: costs about 5 to 10 times more to attract a new customer than to retain a current customer
o Marketers must be concerned with the lifetime value of the customer both their loyalty and their profitability.
Building Relationships
Customer (perceived) value and satisfaction
o Must exceed expectations
Loyalty and retention:
o Increases as satisfaction levels increase
o Delighting consumers should be the goal
o Loyalty programs may be useful to increase customer retention
o Customers have relationships with brands and companies, just like they do with people, and these must be nurtured
Is loyalty always the goal?
o Not always!
Loyal, high volume customers know their value to you and may exploit you to get premium services and discounts.
Customers spread the word only if they feel, as well as act, loyal.
o Selective relationship building
Building relationships with the right customers
Realize that not all customers are profitable…
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Customer Relationship Groups
Customer lifetime value: the dollar value
of all the purchases of a particular
product/brand/retailer that a customer
will make in their lifetime.
Share customer: the portion of a
particular customer’s purchasing in the
marketer’s product category.
Customer equity: the total combined
customer lifetime value of all of the
company’s customers.
Marketing Plan
Steps involved include:
1. Learn about your environment
2. Define your objectives
3. Design a strategy to achieve those objectives
4. Measure results to determine if you did achieve your objectives
The purpose of a SWOT analysis is to build an understanding of the internal and external situation of a company.
A SWOT is performed for relevant strategic business unit or a
relevant customer segment. Otherwise you are not focusing on
valuable information.
Includes implications never put anything on a SWOT that doesn’t
matter to your company or business unit
Avoid SWAGs (scientific wild a__ guess)
Do not confuse opportunities and alternatives:
o “Have the ability to launch a new campaign” possible course of action
o “Consumers are trending towards organic foods” opportunity
o “Opportunity to design a new brand course of action
o “Decreased labour costs in China” opportunity
Environmental analysis the marketing environment consists of actors and
forces inside and outside the organization that affect management’s ability to
build and maintain relationships with target customers.
o Microenvironment actors close to the company, affecting ability to
serve
o Macroenvironment larger societal forces beyond your control
Setting Objectives:
o The mission of the organization is translated into detailed, quantifiable objectives.
o The rest of the planning process is supported by these objectives.
o Objectives are SMART: specific, measurable, achievable, relevant and timely.
Microenvironment
Macroenvironment
The Company
Demographics
Suppliers
Economy
Marketing
Intermediaries
Natural Environment
Customers
Technology
Competitors
Politics
Publics
Culture
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Document Summary

Session 1 marketing: creating and capturing customer value. A social and managerial process, allowing parties to satisfy wants and needs through creating and exchanging value. Fundamentally, marketing includes two core activities: attract new customers by offering superior value than competitors. Value = perceived benefit perceived costs: keep and grow current customers by delivering satisfaction and building long-term relationships with customers. The process whereby a company determines who to serve, and how to serve them best. Collection of marketing activities that together accomplish the larger goal of satisfying customer needs and building customer relationships. 4 p"s product, price, place (distribution), promotion. Market set of actual and potential buyers of a product or service. Need state of felt deprivation including physical, social and individual needs. Wants specific form of a need that is shaped by culture and personality. The choices we make to fulfill our needs. Demand a want" backed by buying power.

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