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Chapter 1

Principles of Marketing- Chapter 1.docx

5 Pages

Management (MGM)
Course Code
Tarun Dewan

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Chapter 1- Marketing: Creating and capturing customer value  Marketing: managing profitable customer relationships to create value for customers and capture value from customers in return The marketing process: understand the design a construct a build profitable capture value marketplace customer- marketing relationships from customers and customer driven program that and create to create profits needs and marketing deliveres customer and customer wants strategy superior value delight equity  Needs: states of felt deprivation  Wants: the form human needs take as they’re shaped by culture and individual personality  Demands: human wants that are backed by buying power  Market offerings: some combination of products, services, information, or experiences offered to a market to satisfy a need or want o Aren’t only limited to physical products as they also include services, and can also include other entities such as persons, places, organizations, information, and ideas  Marketing myopia: the mistake of paying more attention to the specific products a company offers than to the benefits and experiences produced by these products  Smart marketers look beyond the attributes of the products and services they sell and create brand experiences for customers  Customer value and customer satisfaction are key building blocks for developing and managing customer relationships  Exchange: the act of obtaining a desired object from someone by offering something in return  Market: the set of all actual and potential buyers of a product or service  The main elements in a marketing system: 1. The company and competitors research the market and interact with consumers to understand their needs 2. They then create and send their market offerings and messages to consumers, either directly or through marketing intermediaries. Each party in the system is affected by major environmental forces (demographic, economic, natural, technological, political, social/cultural) 3. Each party in the system adds value for the next level. Therefore a company’s success at building profitable relationships not only depends on its own actions but also on how well the entire system serves the needs of final consumers  Marketing management: the art and science of choosing target markets and building profitable relationships with them. This involves finding, attracting, keeping and growing target customers by creating, delivering, and communicating superior customer value. Simply put, it’s customer management and demand management  To design a marketing strategy, marketer managers must answer the following 2 questions: 1. What’s our target market? – in order to decide this, the company divides the market into segments of customers (market segmentation) and selecting which segments it will go after (target marketing) 2. What’s our value proposition? – the company must decide how it will differentiate and position itself and a brand’s value proposition is the set of benefits or values it promises to deliver to consumers to satisfy their needs Marketing management orientations 1. Production concept: the idea that consumers will favour products that are available and highly affordable and that the organization should therefore focus on improving production and distribution efficiency 2. Product concept: the idea that consumers will favour products that offer the most in quality, performance, and innovative features and that the organization should therefore devote its energy to making continuous product improvements 3. Selling concept: the idea that consumers will not buy enough of the firm’s products unless it undertakes a large- scale selling and promotion effort takes an inside-out perspective starting with the factory and focusing on existing products and then calling on heavy selling and promotion to obtain profitable sales short-term sales START FOCUS MEANS ENDS Existing Selling and Profits through Factory product promoting sales volume 4. Marketing concept: a philosophy that holds that achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do Instead of a product-centered “make and sell” philosophy, the marketing concept is a customer-centered “sense and respond” philosophy  takes an outside-in perspective starting with a well-defined market, focusing on customer needs, and integrating all marketing activities that affect customers ENDS START FOCUS MEANS Market Customer Needs Integrated Procustomerough Marketing satisfaction  Customer-driven companies: research current customers deeply to learn about their desires, gather new product and service ideas and test proposed product improvements  Customer-driving marketing: understanding customer needs even better than customers themselves do and creating products and services that meet existing and latent needs, now and in the future 5. Societal marketing concept: the idea that a company’s marketing decisions should consider consumers’ wants, company’s requirements, consumers’ long0run interests and society’s long-run interests company consumers society societal marketing THE MARKETING PROCESS: marketplace/customer dedriven marketinger- constructing a marketing building profitable needs strategy program customer relationships Customer relationship management  Customer relationship management: the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction  Customer-perceived value: the customer’s evaluation of the difference between all benefits and costs of a market offering relative to those of competing offers  Customer satisfaction: the extent to which a product’s perceived performance matches a buyer’s expectations  Customer relationship leve
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