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Topic Outline
Evolution of the Marketing Concept: Marketing Management Orientation or Philosophy What is Marketing? Choosing a Value Proposition Market Offerings Customer Satisfaction Customer Lifetime Value Customer Equity Market Share Marketing Process Marketing Environment and Customer Driven Marketing Strategy The Marketing Mix Variables or The Marketing Strategy

Marketing Management Orientations

Marketing Management Orientations

Production concept is the idea that consumers will favor products that are available or highly affordable.

Production concept

Product concept

Selling concept

Marketing concept

Societal concept
Production concept Product concept Selling concept Marketing concept Societal concept

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Marketing Management Orientations

Product concept is the idea that consumers will favor products that offer the most quality, performance and features. Organization should therefore devote its energy to making continuous product improvements.

Marketing Management Orientations

Selling concept is the idea that consumers will not buy enough of the firms products unless it undertakes a large scale selling and promotion effort.

Production concept Production concept Product concept Selling concept Marketing concept Societal concept

Product concept

Selling concept

Marketing concept

Societal concept

Marketing Management Orientations

Marketing concept is the idea that achieving organizational goals depends on knowing the needs and wants of the target markets and delivering the desired satisfactions better than competitors do.

The Selling and Marketing Concepts Contrasted

Production concept

Product concept

Selling concept

Marketing concept

Societal concept

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Marketing Management Orientations

Societal marketing concept is the idea that a company should make good marketing decisions by considering consumers wants, the companys requirements, consumers long-term interests, and societys long-run interests

What is Marketing?
The Chartered Institute of Marketing (CIM) defines marketing as: the management process for identifying, anticipating and satisfying customer requirements (needs and wants) profitably. Philip Kotler defines marketing as: satisfying needs and wants through an exchange process.

Production concept

Product concept

Selling concept

Marketing concept

Societal concept

Customer Needs, Wants & Demands

What is Marketing?
Exchange
is the act of obtaining a desired object from someone by offering something in return The provision or transfer of goods, services, or ideas in return for something of value

Needs Wants Demands

States of deprivation Physicalfood, clothing, warmth, safety Socialbelonging and affection Individualknowledge and self-expression

Form that needs take as they are shaped by culture and individual personality

Wants backed by buying power

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What is Marketing?

What is Marketing?
The process of creating, distributing, promoting and pricing goods, services and ideas to facilitate satisfying exchange relationships with customers and develop and maintain favorable relationships with stakeholders in a dynamic environment
Hult, Pride & Ferrell (2012)

The process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return Goals
Attract new customers by promising superior value Keep and grow current customers by delivering satisfaction
Kotler & Armstrong (2010)

Choosing a Value Proposition

Value proposition:The set of benefits or values a company promises to deliver to consumers to satisfy their needs

Customer Perceived Value

The customers evaluation of the difference between all of the benefits and all of the costs of a marketing offer relative to those of competing offers

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Value-Driven Marketing
Value A customers subjective assessment of benefits relative to costs in determining the worth of a product.
Functional Benefits Emotional Benefits Monetary Cost Time Cost Psychic Cost

Discussion Question
What kind-of marketing approach did Maxwell House take?

Value

Customer Benefits

Customer Costs

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

Market Offerings Products, Services, and Experiences

Some combination of products, services, information, or experiences offered to a market to satisfy a need or want

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Market OfferingsProducts, Services, and Experiences

Not limited to physical products Include entities such as persons , places , organizations, information and ideas

Customer Satisfaction
The extent to which the products perceived performance matches a buyers expectations

Capturing Value From Customers

Capturing Value From Customers

For companies interested in delighting customers, exceptional value and service become part of the overall company culture

Superior customer value leads to highly satisfied loyal customers who buy more

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Discussion Questions
How does Apple utilize technology in its marketing efforts? Customer lifetime value
The value of the entire stream of purchases that the customer would make over a lifetime of patronage

Customer Equity

The total combined customer lifetime values of all the companys current and potential customers

Market Share
Market a group of individuals that have needs for products in a product class and have the ability, willingness and authority to purchase those products. Market share the percentage of a market that actually buys a specific product form a particular company.

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Marketing Process
Understand the marketing environment and customer needs & wants Creating and capturing customer value Develop Marketing Plan that delivers superior value Capture value from customers to create profits and customer equity

Marketing Environment and Customer Driven Marketing Strategy

Research customers & marketing environment Manage marketing information and customer data

Select customers to serve: market segmentation and targeting Decide on a value proposition: differentiation and positioning

Product and service design: build strong brands Pricing: creating real value Distribution: manage demand and supply chains Promotion: communicate the value proposition

Create satisfied, loyal customers Capture customer lifetime value

Increase market share

Ensure ethical & social responsibility

The Marketing Mix Variables or The Marketing Strategy

Marketers combine and balance four elements when determining how to satisfy customers needs for a product Product Price Distribution Promotion

Topic Outline
Evolution of the Marketing Concept: Marketing Management Orientation or Philosophy What is Marketing? Choosing a Value Proposition Market Offerings Customer Satisfaction Customer Lifetime Value Customer Equity Market Share Marketing Process Marketing Environment and Customer Driven Marketing Strategy The Marketing Mix Variables or The Marketing Strategy