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Chapter 12

MGMT 1000 Chapter Notes - Chapter 12: Target Market, Psychographic, Customer Relationship Management


Department
Management
Course Code
MGMT 1000
Professor
Kathleen Rodenburg
Chapter
12

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WHAT IS MARKETING:
Marketing:
- Defined as an organizational function and a set of processes for creating, communicating
and delivering value to customers and for managing customer relationships in ways that
benefit the organization and its shareholders
Marketing Concept:
- The idea that the whole firm is directed toward serving present and potential customers
at a profit
Value and Benefits:
- Value: a relative comparison of a product's benefits versus its costs
- Include emotional satisfaction of owning, experiencing or possessing it
- Value ratio
- Value = Benefits/Costs
- To Satisfy Customers
- Develop an entirely new product that performs better (provides greater
performance benefits) than existing products
- Keep a store open longer hours during a busy season (adding the benefit of
greater shopping convenience)
- Offer price reductions (the benefit of lower costs)
- Offer information that explains how a product can be used in new ways (the
benefit of new uses at no added cost)
Value and Utility:
- Utility: The ability of a product to satisfy a human want or need (form, time, place,
possession)
Goods, Services and Ideas:
- Consumer Goods: tangible goods that you can buy for personal use
- Industrial Goods: Physical products purchased by companies to produce other
products
- Services: Products with non-physical features, such as information, expertise, or an
activity that can be purchased
Relationship Marketing:
- Marketing strategy that emphasizes building lasting relationships with customers and
suppliers
Customer Relationship Management:
- Organized methods that a firm uses to build better information connections with clients,
so that stronger company client relationships are developed

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- Data Warehousing: compiling and storing customer’s data
- Identifies best customers
- Allows marketers to predict what customers want and will buy
- Data Mining: automates the massive analysis of data by using computers to sort
and search for previously undiscovered clues about what customers look at and
react to , and how they might be influenced
The Marketing Environment:
- Political-Legal
- Socio-Cultural
- Technological
- Economic
- Competitive:
- Substitute products
:
- Brand Competition:
- International Competition
DEVELOPING THE MARKETING PLAN
Marketing Plan: Detailed strategy for focusing marketing efforts on consumer’s needs and
wants
Marketing Objectives: the things marketing intends to accomplish in its marketing plans
Strategy: The Marketing Mix
Marketing Strategy:
- All the marketing programs and activities that will be used to achieve the marketing
goals
- Marketing Managers:
responsible for planning, organizing, leading and controlling the
organization’s marketing resources
- Includes Basic 4 components See lecture notes Nov 7 and 9 for further details
- Product
- Pricing
- Place
- Promition
IDENTIFYING MARKET SEGMENTS
Demographic Segmentation
- Demographic variables: Characteristics of populations that may be considered in
developing a segmentation strategy
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Geographic Segmentation
- Geographic Variables: Geographic units that may be considered in developing a
segmentation strategy
Geo-Demographic Segmentation
- Geo-Demographic Variables: Combination of geographic and demographic traits
used in developing a segmentation strategy
Psychographic Segmentation
- Psychographic Variables: Consumer Characteristics such as lifestyles, opinions,
interests and attitudes that may be considered in developing a segmentation strategy
-Important because unlike demographics and geographics, they can sometimes be
changed by marketing efforts
Behaviour Segmentation
-Behaviour Variables: Behavioural considerations such as benefits sought, loyalty
status, usage rate, user status, and occasion for use that may be used in developing
segmentation strategy
MARKETING RESEARCH
- The study of what customers need and want and how best to meet those needs
-
The Research Process:
1. Study the Current Situation:
a. What is the need and what is currently being done to meet it?
2. Select a Research Method
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