Post on 06-Jul-2018
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
1/47
Marketing: Creating and
Capturing Customer Value
Prof. Alexander Chan Trajano
1Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
2/47
"hat !s Marketing#
• Marketing is the process $% &hich companiescreate 'alue for customers and $uild strongcustomer relationships in order to capture
'alue from customers in return• Marketing is a social and managerial process
$% &hich indi'iduals and organi(ations o$tain&hat the% need and &ant through creating
and exchanging 'alue &ith others• Marketing is managing pro)ta$le customer
relationships
*Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
3/47
T&o+,old -oal of Marketing
• Attract ne& customers $% promisingsuperior 'alue telling and selling/
• eep and gro& current customers $%deli'ering satisfaction satisf%ingcustomer needs/
0Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
4/47
ome 2xamples
• "almart 3 4a'e mone%. 5i'e$etter.6
• 7intendo 3 4"ii &ould like to pla%.6
• Mc8onald9s 3 4!9m lo'in9 it6
Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
5/47
ound Marketing
• ,or pro)t )rms
• ,or non+pro)t organi(ations likecolleges; hospitals; museums;s%mphon% orchestras; churches; etc.
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
6/47
"here 8o "e ee Marketing At
"ork#
• hopping malls
• Ad'ertisements on TV; radio; print
•
Maga(ines• Mail$ox
• "e$ sites and online social net&orks
•
Cell phone
=Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
7/47
The Marketing Process
>nderstand the
marketplace and
customerneeds and
&ants
8esign acustomer+
dri'enmarketingstrateg%
Construct
anintegratedmarketingprogram
thatdeli'erssuperior
'alue
?uildpro)ta$lerelationshi
ps andcreate
customerdelight
Capture'alue fromcustomersto create
pro)ts andcustomer
e@uit%
Principles of MarketingMARPR!$
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
8/47
>nderstanding the Marketplaceand Customer 7eeds
• ,i'e core customer and marketplaceconcepts:
a. 7eeds; &ants; and demands
$. Market oBerings products; ser'ices;and experiences/
c. Value and satisfaction
d. 2xchanges and relationships; and
e. Markets
Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
9/47
Customer 7eeds; "ants; and
8emands
• Needs are states of felt depri'ation
• Duman needs include $asic physical needs for food; clothing; &armth; andsafet%E social needs for $elongingand aBectionE and individual needsfor kno&ledge and self expression
FPrinciples of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
10/47
Customer 7eeds; "ants; and
8emands
• Wants are the form human needstake as the% are shaped $% cultureand indi'idual personalit%
• A ,ilipino needs food $ut wantsChicken Go%
• "ants are shaped $% one9s societ%and are descri$ed in terms of o$jectsthat &ill satisf% those needs
1HPrinciples of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
11/47
Customer 7eeds; "ants; and
8emands
• Demands are human &ants that are$acked $% $u%ing po&er
• -i'en people9s &ants and resources;the% demand products &ith $ene)tsthat add up to most 'alue andsatisfaction
11Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
12/47
>sing and no&ing Customer 7eeds;"ants; and 8emands
• Iutstanding marketing companies go togreat lengths to learn a$out andunderstand their customers9 needs; &ants;
and demands• The% conduct consumer research and
anal%(e mountains of customer data
• Their people at all le'els 3 including topmanagement 3 sta% close to customersusing social media: T&itter; ,ace$ook;!nstagram; etc./
1*Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
13/47
Market IBerings 3Products; er'ices; and 2xperiences
• Market oferings are somecom$ination of products; ser'ices;information; or experiences oBered
to a market to satisf% a need or &ant
• Market oBerings also include otherentities; such as persons; places;
organi(ations; information; and ideas
10Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
14/47
Marketing M%opia
• Marketing myopia is the mistake of pa%ing moreattention to the speci)c products a compan% oBersthan to the $ene)ts and experiences produced $%these products
• ome companies focus onl% on existing &ants andlose sight of underl%ing customer needs. The%forget that a product is onl% a tool to sol'e aconsumer pro$lem
• ellers &ill ha'e trou$le if a ne& product comesalong that ser'es the customer9s need $etter orless expensi'el%. The customer &ill ha'e the sameneed $ut &ill &ant the ne& product
1Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
15/47
Marketing M%opia
• mart marketers look $e%ond theattri$utes of the products andser'ices the% sell
• ?% orchestrating se'eral ser'ices andproducts; the% create brandexperiences for consumers
1
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
16/47
Customer Value andatisfaction
• Consumers usuall% face a $road arra% of productsand ser'ices that might satisf% a gi'en need
• Do& do the% choose among these man% marketoBerings#
• Customers form expectations a$out the valueand satisaction that 'arious marketoferings &ill deli'er and $u% accordingl%
• atis)ed customers $u% again and tell others
a$out their good experiences. 8issatis)edcustomers often s&itch to competitors anddisparage the product to others cont9d/
1=Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
17/47
Customer Value andatisfaction
• Marketers must $e careful to set the rightle'el of expectations
• !f the% set expectations too lo&; the% ma%
satisf% those &ho $u% $ut fail to attractenough $u%ers. !f the% set expectationstoo high; $u%ers &ill $e disappointed
•
Customer 'alue and customer satisfactionare ke% $uilding $locks for de'eloping andmanaging customer relationships
1Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
18/47
2xchanges andRelationships
• Marketing occurs &hen people decide to satisf%needs and &ants through exchange relationships
• Exchange is the act of o$taining a desired o$jectfrom someone $% oBering something in return
• The marketer tries to $ring a$out a response tosome market oBering. The response ma% $emore than simpl% $u%ing or trading products andser'ices
• A politician &ants 'otesE a church &antsmem$ershipE an orchestra &ants an audienceE asocial action group &ants idea acceptancecont9d/
1Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
19/47
2xchanges andRelationships
• Marketing consists of actions taken to $uild andmaintain desira$le exchange relationships &ith target audiences in'ol'ing a product;ser'ice; idea; or other o$ject
• ?e%ond simpl% attracting ne& customers andcreating transactions; companies &ant to retaincustomers and gro& their $usinesses
•
Marketers &ant to $uild strong relationships $%consistentl% deli'ering superior customer 'alue
1FPrinciples of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
20/47
Markets
• A market is the set of actual and potential $u%ersof a product or ser'ice
• These $u%ers share a particular need or &ant thatcan $e satis)ed through exchange relationships
• Marketing means managing markets to $ring a$outpro)ta$le customer relationships 3 sellers mustsearch for $u%ers; identif% their needs; design goodmarket oBering; set prices for them; promote them;and store and deli'er them
• Acti'ities such as consumer research; productde'elopment; communication; distri$ution; pricing;and ser'ice are core marketing acti'ities cont9d/
*HPrinciples of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
21/47
Markets
• ?u%ers also carr% out marketing. Consumers market&hen the% search for products; interact &ith companiesto o$tain information; and make their purchases
• Toda%; digital technolog% ha'e empo&ered consumersand made marketing a trul% interacti'e aBair
• !n addition to customer relationship management;toda%9s marketers must also deal eBecti'el% &ithcustomer+managed relationships
• Marketers are no longer asking onl%; 4Do& can &e
reach our customers#6 $ut also 4Do& should ourcustomers reach us#6 and e'en 4Do& can ourcustomers reach each other#6
*1Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
22/47
8esigning A Customer+8ri'en
Marketing trateg%
• Marketing Management is the art and science ofchoosing target markets and $uilding pro)ta$lerelationships &ith them
• The marketing manager9s aim is to )nd; attract;
keep; and gro& target customers $% creating;deli'ering; and communicating superior customer
'alue
• To design a &inning marketing strateg%; the
marketing manager must ans&er t&o important@uestions: 4"hat customers &ill &e ser'e &hat9sour target market/#6 and 4Do& can &e ser'e thesecustomers $est &hat9s our 'alue proposition/#6
**Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
23/47
electing Customers Toer'e
•
Market segmentation is di'iding the market intosegments of customers
• Target marketing is selecting &hich segments it &ill goafter
• Marketing managers kno& that the% cannot ser'e all
customers in e'er% &a%; if the% tr% this; the% ma% not ser'ean% customers &ell
• The compan% must select onl% customers that it can ser'e&ell and pro)ta$l%
• >ltimatel%; marketing managers must decide &hich
customers the% &ant to target on le'el; timing; and natureof their demand. Marketing management is customermanagement and dem
• and management
*0Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
24/47
Choosing A ValueProposition
• The compan% must also decide ho& it &ill ser'etargeted customers 3 ho& it &ill diferentiate and
position itself in the marketplace
• A $rand9s value proposition is the set of $ene)ts or
'alues it promises to deli'er to consumers to satisf%their needs
• uch 'alue propositions diBerentiate one $rand fromanother
• The% ans&er the customer9s @uestion; 4"h% should !
$u% %our $rand rather than a competitor9s#6
• Companies must design strong 'alue propositionsthat gi'e them the greatest ad'antage in their targetmarkets
*Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
25/47
Marketing Management Irientations
• Marketing management &ants to design strategiesthat &ill $uild pro)ta$le relationships &ith targetconsumers
• ?ut &hat philosoph% should guide these marketing
strategies# "hat &eight should $e gi'en to theinterests of customers; the organi(ation; andsociet%#
• There are )'e alternati'e concepts under &hich
organi(ations design and carr% out their marketingstrategies: the production; product ; selling;marketing; and societal marketing concepts
*
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
26/47
The Production Concept
• The production concept holds thatconsumers &ill fa'or products thatare a'aila$le and highl% aBorda$le
and that the organi(ation shouldtherefore focus on impro'ingproduction and distri$ution eJcienc%
• This concept is one of the oldestorientations that guide sellers
*=Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
27/47
The Product Concept
• The product concept holds that consumers &illfa'or products that oBer the most in @ualit%;performance; and inno'ati'e features and that theorgani(ation should therefore de'ote its energ% to
making continuous product impro'ements• This concept is important up to the point that it
should pre'ent the compan% from experiencingmarketing myopia
• "hile consumers &ant manufacturers to $uild a$etter mousetrap; the% might $e looking for a$etter solution to a mouse pro$lem
*Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
28/47
The elling Concept
• The selling concept is the idea thatconsumers &ill not $u% enough of the )rm9sproduct unless it undertakes a large+scale
selling and promotion eBort• The selling concept is t%picall% practiced &ith
unsought goods 3 those that $u%ers do notnormall% think of $u%ing; such as insurance
or $lood donations. These industries must$e good at tracking do&n prospects andselling them on a product9s $ene)ts cont9d/
*Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
29/47
The elling Concept
• uch aggressi'e selling carries high risks. !tfocuses on creating sales transactions ratherthan on $uilding long+term; pro)ta$le; customerrelationships
• The aim often is to sell &hat the compan%makes rather than making &hat the market&ants
• !t assumes that customers &ho are coaxed into$u%ing the product &ill like it
• Ir; it the% don9t like it; the% &ill possi$l% forgettheir disappointment and $u% it again later
*FPrinciples of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
30/47
The Marketing Concept•
The marketing concept is a philosoph% thatholds that achie'ing organi(ational goals dependson kno&ing the needs and &ants of target marketsand deli'ering the desired satisfactions $etter thancompetitors do
• Customer focus and 'alue are the paths to salesand pro)ts
• !nstead of a product+centered 4make and sell6philosoph%; the marketing concept is a customer+
centered 4sense and respond6 philosoph%
• The jo$ is not to )nd the right customers for %ourproduct $ut to )nd the right products for %ourcustomers
0HPrinciples of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
31/47
elling and Marketing
Concepts Contrasted
The SellingConcept
(Inside-Out View)
The MarketingConcept
(Outside-In View)
tartingPoint
,actor% Market
,ocus 2xisting products Customer needssatis)ed/
Means elling andpromoting
!ntegrated marketing
2nds Pro)ts through sales'olume
Pro)ts through customersatisfaction
Tr%ing to do ell &hat the
compan% makesrather than &hat the
4"e do not ha'e a
marketing department;&e ha'e a customer01Principles of Marketing
MARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
32/47
The Marketing Concept
• The marketing concept starts &ith a &ell+de)ned market;focuses on customer needs; and integrates all themarketing acti'ities that aBect customers
• !n turn; it %ields pro)ts $% creating lasting relationships&ith the right customers $ased on customer 'alue and
satisfaction• ustomer!driven companies research current customers
deepl% to learn a$out their desires; gather ne& product andser'ice ideas; and test proposed product impro'ements
• ustomer!driving marketing is understanding customer
needs e'en $etter than customers themsel'es do sincesome times customers don9t kno& &hat the% &ant/ andcreating products and ser'ices that meet existing andlatent needs; no& and in the future
0*Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
33/47
The ocietal MarketingConcept
• The societal marketing concept is the idea thata compan%9s marketing decisions should considerconsumers9 &ants; the compan%9s re@uirements;consumers9 long+run interests; and societ%9s long+
run interests• !t calls for sustainable marketing; sociall%; and
en'ironmentall% responsi$le marketing that meetsthe present needs of consumers and $usinesses
&hile also preser'ing or enhancing the a$ilit% offuture generations to meet their needs
• ?ottled &ater + plastic $ottles use car$on dioxideand rec%cling
00Principles of MarketingMARPR!
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
34/47
ocietal Marketing Concept
ociet%
Duman "elfare/
Consumers
"antatisfaction/
Compan%
Pro)ts/
Principles of MarketingMARPR!
0
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
35/47
Preparing An !ntegrated
Marketing Plan and Program
• The compan%9s customer+dri'enmarketing strateg% outlines &hichcustomers it &ill ser'e the target
market/ and ho& it &ill create 'alue'alue proposition/ for these customers
• 7ext; the marketer de'elops an
integrated marketing programmarketing mix/ that &ill actuall% deli'erthe intended 'alue to target customers
Principles of MarketingMARPR!
0<
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
36/47
?uilding CustomerRelationships
• ustomer relationshipmanagement is the o'erall processof $uilding and maintaining pro)ta$le
customer relationships $% deli'eringsuperior customer 'alue andsatisfaction
Principles of MarketingMARPR!
0=
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
37/47
Customer Value andatisfaction
• ustomer!perceived value is thecustomer9s e'aluation of the diBerence$et&een all the $ene)ts and all the costs
of a marketing oBer relati'e to those ofcompeting oBers some customers are&illing to pa% more and some are not/
• ustomer satisaction is the extent to
&hich a product9s percei'ed performancematches a $u%er9s expectations fall short;matches; exceeds expectations/
Principles of MarketingMARPR!
0
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
38/47
Customer Relationship
5e'els and Tools
• A compan% &ith man% lo&+margin customersma% seek to de'elop basic relationships &iththem
• A compan% &ith fe& customers and highmargins create ull partnerships &ith them
• Companies can oBer re"uency marketing programs that re&ard customers &ho $u%fre@uentl% or in large amounts
• Companies can sponsor club marketing programs that oBer mem$ers special $ene)tsand create mem$er communities
Principles of MarketingMARPR!
0
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
39/47
The Changing 7ature of
Customer Relationships
• #elating with More areully $electedustomers
- ?% asking @uestions to screen if the customer isa potential pro)ta$le one
- ?% 4)ring6 customers that cost more to ser'ethan to lose
- 7ot all customers are &orth %our marketing
eBorts. ome are more costl% to ser'e than tolose. !f %ou can9t sa% &ho %our customersaren%t ; %ou pro$a$l% can9t sa% &ho %ourcustomers are
Principles of MarketingMARPR!
0F
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
40/47
The Changing 7ature of
Customer Relationships
• #elating More Deeply and &nteractively
- T&o+&a% customer relationships $% emplo%ingne& technologies e+mail; &e$ sites; $logs; cellphones; and 'ideo/
- This changing communications en'ironmentalso aBects ho& companies and $rands relate tocustomers $% letting markers create deepercustomer in'ol'ement and a sense ofcommunit% surrounding a $rand 3 to make the$rand a meaningful part of consumers9con'ersations and li'es cont9d/
Principles of MarketingMARPR!
H
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
41/47
The Changing 7ature of
Customer Relationships
• #elating More Deeply and &nteractively
- ustomer!managed relationships aremarketing relationships in &hich customers;empo&ered $% toda%9s digital technologies;
interact &ith companies and &ith each other toshape their relationships &ith $rands
- onsumer!generated marketing are the $randexchanges created $% consumers themsel'es 3
$oth in'ited and unin'ited 3 $% &hich consumersare pla%ing an increasing role in shaping their o&n$rand experiences and those of other consumers
Principles of MarketingMARPR!
1
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
42/47
Partnership Relationship
Management
• 'artnership relationshipmanagement is &orking closel% &ithpartners in other compan%
departments and outside thecompan% to jointl% $ring greater 'alueto customer
-
Partners inside the compan%- Marketing partners outside the )rm
suppl% chain/
Principles of MarketingMARPR! *
C t i V l ,
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
43/47
Capturing Value ,romCustomers
• reating ustomer (oyalty and#etention
- ustomer lietime value is the'alue of the entire stream ofpurchases that the customer &ouldmake o'er a lifetime of patronage
Principles of MarketingMARPR! 0
C t i V l ,
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
44/47
Capturing Value ,romCustomers
• )rowing $hare o ustomer
- $hare o customer is the portion ofthe customer9s purchasing that a
compan% gets in its productcategories
Principles of MarketingMARPR!
C t i V l ,
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
45/47
Capturing Value ,romCustomers
• *uilding ustomer E"uity
- ustomer E"uity is the totalcom$ined customer lifetime 'alues of
all of the compan%9s customers
Principles of MarketingMARPR! <
C t i V l ,
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
46/47
Capturing Value ,romCustomers
• *uilding the #ight #elationships withthe #ight ustomers
1. trangers + sho& lo& potential
pro)ta$ilit% and little projected lo%alt%*. ?utterKies + are potentiall% pro)ta$le $ut
not lo%al
0. True friends + are $oth pro)ta$le and lo%al
. ?arnacles + are highl% lo%al $ut not 'er%pro)ta$le
Principles of MarketingMARPR! =
Th Ch i M k ti
8/17/2019 01 Marketing Creatingandcapturingcustomervalue
47/47
The Changing Marketing5andscape
• The >ncertain 2conomic 2n'ironment
• The 8igital Age !nternet/
• Rapid -lo$ali(ation
• ustaina$le MarketingLThe Call forMore ocial Responsi$ilit%
• The -ro&th of 7ot+for+Pro)tMarketing