Copyright © 2007 by The McGraw-Hill Companies, Inc. All Rights Reserved. Slide 1-1 CREATING...

Copyright © 2007 by The McGraw-Hill Companies, Inc. All Rights Reserved. Slide 1-1

CREATING CUSTOMER

RELATIONSHIPS AND VALUE

THROUGH MARKETING

CHAPTER


AFTER READING THIS CHAPTERYOU SHOULD BE ABLE TO:

1. Define marketing and identify the requirements for marketing to occur.

2. Explain how marketing discovers and satisfies consumer needs.

3. Distinguish between marketing mix elements and environmental forces.


AFTER READING THIS CHAPTERYOU SHOULD BE ABLE TO:

4. Explain how organizations build strong relationships and customer value through marketing.

5. Describe how today’s customer era differs from prior eras oriented to production and selling.


A MARKETING AND PRODUCT PUZZLE: HOW DO COLLEGE

STUDENTS STUDY?

• The Legend:The ProductNobody Seemedto Want



STUDENTS STUDY?

• Discovering Student Studying Needs

3M Post-it® Notes or Post-it® Flags

=3M product that will combine

Post-it® Notes or Post-it® Flags and Highlighters

+Felt Tip Highlighters



STUDENTS STUDY?

• SatisfyingStudentStudyingNeeds

• 3M’s Technology,Marketing, and You


The Office Market SegmentHow can 3M reach this segment with the

Post-it® Flag Highlighter?


3M Post-it® Flag HighlighterHow do college students study?


FIGURE 1-1FIGURE 1-1 The see-if-you’re-really-a-marketing-expert test

1. True

2. (c) 30%

3. True

4. (c) plastic bottles


WHAT IS MARKETING?

• Marketing: Using Exchanges to Satisfy Needs

Marketing

Exchange

• The Diverse Forces Influencing Marketing Activities


FIGURE 1-2FIGURE 1-2 An organization’s marketing department relates to many people, groups, and forces


1. What is marketing?

A: Marketing is 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 stakeholders.

Concept Check


Concept Check

2. Marketing focuses on __________ and ________ consumer needs.

discoveringsatisfying


HOW MARKETING DISCOVERS AND SATISFIES CONSUMER NEEDS

• Discovering Consumer Needs

The Challenge of Meeting Consumer NeedsWith New Products

• “Focus on the consumer benefit”

• “Learn from the past”


Dr. Care Vanilla-Mint Aerosol ToothpasteWhat “benefits” and what “showstoppers”?


Hot Pockets Subs Microwaveable SnacksWhat “benefits” and what “showstoppers”?


Scooba Robotic Floor WasherWhat “benefits” and what “showstoppers”?


Coca Cola C2What “benefits” and what “showstoppers”?



• Discovering Consumer Needs

Consumer Needs and Consumer Wants

What a Market Is

• Need

• Want


FIGURE 1-3FIGURE 1-3 Marketing’s first task: discovering consumer needs


• Satisfying Consumer Needs

The Four P’s: Controllable Marketing MixFactors

Target Market

• Product • Promotion• Price • Place

The Uncontrollable, Environmental Forces


• Social • Technological• Economic

• Competitive • Regulatory


FIGURE 1-AFIGURE 1-A Summary of factors that affect an organization’s marketing program


THE MARKETING PROGRAM:HOW CUSTOMER RELATIONSHIPS

ARE BUILT

Best Product

Best Price

• Customer Value and Customer Relationships

Best Service


Costco, Starbucks, and Lands’ EndWhat customer value strategy?



ARE BUILT

The Marketing Program

Relationship Marketing: Easy to Understand,Hard to Do

• Relationship Marketing and the Marketing Program


FIGURE 1-4FIGURE 1-4 Marketing’s second task: satisfying consumer needs


• A 3M Product andMarketing Program toHelp Students Study

Moving from Ideasto a MarketableHighlighter Product


ARE BUILT


• A 3M Product andMarketing Program toHelp Students Study

A Marketing Programfor the Post-it® FlagHighlighter and Pen


ARE BUILT

Extending theProduct Line


FIGURE 1-5FIGURE 1-5 Marketing programs for two new 3M Post-it® brand products targeted at two distinctly different customer segments: college students and office workers


Concept Check

1. An organization can’t satisfy the needs of all consumers, so it must focus on one or more subgroups, which are its ____________.target markets


Concept Check

2. What are the four marketing mix elements that make up the organization’s marketing program?

A: product, price, promotion, place


Concept Check

3. What are environmental forces?

A: Environmental forces are those that the organization’s marketing department can’t control. These include social, economic, technological, competitive, and regulatory forces.


HOW MARKETING BECAMESO IMPORTANT

• Evolution of the Market Orientation

Production Era

Customer Era

Sales Era

Marketing Concept Era

• Market Orientation

• Customer Relationship Management (CRM)


FIGURE 1-BFIGURE 1-B Four different orientations in the history of American business


• Societal Marketing Concept

• Ethics and Social Responsibility: Balancing Interests

Ethics

Social Responsibility



• The Breadth and Depth of Marketing

Who Markets?

What Is Marketed?

• Goods • Services

Who Buys and Uses What Is Marketed?

• Ultimate Consumers

• Organizational Buyers


• Ideas


Arizona HighwaysWho markets and what is marketed?


• The Breadth and Depth of Marketing

Who Benefits?

How Do Consumers Benefit?

• Utility

Form Utility

Place Utility

Time Utility

Possession Utility



Concept Check

1. What are the two key characteristics of the marketing concept?

A: (1) strive to satisfy the needs of consumers (2) while also trying to achieve the organization’s goals.


Concept Check

2. What is the difference between goods and services?

A: Goods are physical objects whereas services are complex intangible items, such as legal advice, a college education, or airline travel.


YOUR PERSONAL MECHANIZED

“TRANSPORTER”

GOING ONLINE


1. What do you see as the advantages and disadvantages of the Segway HT?

Going Online


2. For businesses, what applications could the Segway HT be used for?

Going Online


3. Why would consumers want to buy a Segway HT?

Going Online


ROLLERBLADE: BENEFITS BEYOND EXPECTATIONS

VIDEO CASE 1


VIDEO CASE 1Rollerblade



1. What trends in the environmental forces (social, economic, technological, competitive, and regulatory) (a) work for and(b) work against Rollerblade’s potential growth in the 21st century?



2. Compare the likely marketing goals for Rollerblade (a) in 1986 when Rollerblade was launched and(b) today?



3. What kind of focused communication and promotion actions might Rollerblade take to reach the(a) Fitness/Recreation and (b) Junior market segments? For some starting ideas, visit rollerblade.com.



4. In searching for global markets to enter, (a) what are some criteriathat Rollerblade should use toselect countries to enter, and(b) what three or four countriesmeet these criteria best and are the most likely candidates?


THE MARKETING CHALLENGES FACING ROLLERBLADE, INC.

SUPPLEMENTALLECTURE NOTE 1-1


FIGURE 1-CFIGURE 1-C Number of in-line skaters in the United States


Rollerblade Print ad from the Early 1990sWhat was Rollerblade’s focus?


Rollerblade Print ad from the Early 2000sWhat was Rollerblade’s focus?


DESIGNING A CANDY BAR

IN-CLASS ACTIVITY 1-1


WHAT MAKES ABETTER MOUSETRAP?



If a man (woman)…makes a better

mousetrap,the world will

beat a path to his (her) door.”

Ralph Waldo Emerson

A Victorious Mouse


Victor® Metal Bait Pedal andLive Catch Mousetraps


DEVELOPING AMARKETING PROGRAM

FOR ROLLERBLADE



Rollerblade 2006 Consumer Brochure


Rollerblade’s Crossfire 4D/Activa 4D Skates That Target the Fitness Segment

Crossfire 4D

Activa 4D


Rollerblade’s Spiritblade SkateThat Targets the Recreation Segment


Rollerblade’s Micro TFS SkateThat Targets the Junior Segment


Marketing

AMA Definition of Marketing

Marketing is 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 stakeholders.

Marketing is 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 stakeholders.


Exchange is the trade of things of value between buyer and seller so that each is better off after the trade.

Exchange is the trade of things of value between buyer and seller so that each is better off after the trade.

Exchange


A market consists of people with both the desire and ability to buy a specific product.

A market consists of people with both the desire and ability to buy a specific product.

Market


The target market consists of one or more specific groups of potential customers toward which an organization directs its marketing program.

The target market consists of one or more specific groups of potential customers toward which an organization directs its marketing program.

Target Market


The marketing mix consists ofthe marketing manager’s controllable factors—product, price, promotion, and place (the 4Ps)—that can be used to solve a marketing problem.

The marketing mix consists ofthe marketing manager’s controllable factors—product, price, promotion, and place (the 4Ps)—that can be used to solve a marketing problem.

Marketing Mix


Environmental forces are the uncontrollable factors involving social, economic, technological, competitive, and regulatory forces.

Environmental forces are the uncontrollable factors involving social, economic, technological, competitive, and regulatory forces.

Environmental Forces


Customer value is the unique combination of benefits receivedby targeted buyers that includes quality, price, convenience, on-time delivery, and both before-sale and after-sale service.

Customer value is the unique combination of benefits receivedby targeted buyers that includes quality, price, convenience, on-time delivery, and both before-sale and after-sale service.

Customer Value


Relationship marketing links the organization to its individual customers, employees, suppliers, and other partners for their mutual long-term benefits.

Relationship marketing links the organization to its individual customers, employees, suppliers, and other partners for their mutual long-term benefits.

Relationship Marketing


A marketing program is a plan that integrates the marketing mix to provide a good, service, or idea to prospective buyers.

A marketing program is a plan that integrates the marketing mix to provide a good, service, or idea to prospective buyers.

Marketing Program


The marketing concept is the idea that an organization should (1) strive to satisfy the needs of consumers (2) while also trying to achieve the organization’s goals.

The marketing concept is the idea that an organization should (1) strive to satisfy the needs of consumers (2) while also trying to achieve the organization’s goals.

Marketing Concept


An organization that has a market orientation focuses its efforts on(1) continuously collecting information about customers’ needs, (2) sharing this information across departments, and(3) using it to create customer value.

An organization that has a market orientation focuses its efforts on(1) continuously collecting information about customers’ needs, (2) sharing this information across departments, and(3) using it to create customer value.

Market Orientation


The societal marketing concept is the view that an organization should satisfy the needs of consumers in a way that provides for society’s well-being.

The societal marketing concept is the view that an organization should satisfy the needs of consumers in a way that provides for society’s well-being.

Societal Marketing Concept


Ultimate consumers are the people who use the goods and services purchased for a household.

Ultimate consumers are the people who use the goods and services purchased for a household.

Ultimate Consumers


Organizational buyers are those manufacturers, wholesalers, retailers,and government agencies that buy goods and services for their own use or for resale.

Organizational buyers are those manufacturers, wholesalers, retailers,and government agencies that buy goods and services for their own use or for resale.

Organizational Buyers


Utility is the benefits or customer value received by users of the product.Utility is the benefits or customer value received by users of the product.

Utility

Copyright © 2007 by The McGraw-Hill Companies, Inc. All Rights Reserved. Slide 1-1 CREATING...

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