Value based marketing
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Transcript of Value based marketing
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Value Based MarketingValue Based Marketing Value Based MarketingValue Based Marketing
Compiled by
Bermand Hutagalung
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Marketing – the activity, set of institutions, and processes for creating, communicating,
delivering, and exchanging offerings that have value for customers, clients, partners, and
society at large.
Marketing management is the art and science of choosing target markets and building profitable relationships with them. Marketer must define :
– What customers will we serve?– How can we best serve these customers?
Marketing Definition Marketing Definition
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What Can Be Marketed?
• Goods• Services• Places• Ideas• Events• Persons• Properties• Organizations• Information• Experiences• Social Political
What is being marketed in this ad?
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Marketing: Creating Utility
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The ability of
goods and
services to
satisfy wants.
FormUtility
TimeUtility
PlaceUtility
Ownership Utility
Customer need more than utility, they need value added
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Marketing Trend : from Production to Value Based Era
Production-oriented era
Sales-oriented era
Market-oriented era
Value-based marketing era
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a set of processes for creating, communicating, and delivering value to customers, build strong customer relationships and for managing this relationships in ways that benefit the customers, the organization,
and its stakeholders.
What is Value Based Marketing ? What is Value Based Marketing ?
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ValueBase
Define target marketsand understandcustomer value
Determinevalue
Proposition
Delivervalue
Monitorvalue
Map of Value Creation
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Marketing and The Value Delivery Process Marketing and The Value Delivery Process
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Rubbermaid Commercial Products, Inc.(example of value based vision & mission)
“Our vision is to be the Global Market ShareLeader in each of the markets we serve. We will earn this leadership position by providing to our distributor and end-user customers innovative, high-quality, cost-effective and environmentally responsible products. We will add value to these products by providing legendary customer service through our Uncompromising Commitment to Customer Satisfaction.”
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WHAT’S SO SPECIAL ABOUT ?
The legendary customer service
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The Progression of Economic Value
COMPETITIVE POSITION
Differentiated
Undifferentiated
DISTINCTIVENESS
MemorableUnmemorable
Pine & Gilmore, “Welcome to the Experience Economy,” HBR, July/Aug 1998.
Extract
commodities
Make
goods
Deliver
Customer services
Stage
experiences
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How much value does Starbucks add?
Cost of coffee bean when harvested =
$0.50/lb.
Value realized by Starbucks from selling cup of coffee =
$230/lb.
AN INCREASE IN VALUE
OF +46,000%
See video : How Starbucks create value through excelent customer services
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The value chain is a tool for identifying was to create more customer value because every firm is a synthesis of
primary and support activities performed to design, produce, market, deliver, and
support its product.
The Importance of Value Chain
Customer value can be created through value chain
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Porter’s Value Chain
Firm InfrastructureHuman Resource Management
Technology Development
Procurement
SupportActivities
Inbound Logistics
PrimaryActivities Operatio
ns
Outbound
Logistics
Marketing
and Sales
Service
Upstream value activities Downstream value activities
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Value CreationStrategy at Wal-Mart
Provide value for our customersProvide value for our customers
Low prices, everydayLow prices, everyday
Low inventory levelsLow inventory levels
Linked communications between stores
Linked communications between stores
Short flow timesShort flow times
Fast transportation system
Fast transportation system
Cross-dockingCross-docking Focused locationsFocused locations
EDI/satellitesEDI/satellites
Wal-MartWal-Mart
MissionMission
Competitive Competitive StrategyStrategy
Operations Operations StrategyStrategy
Operations Operations StructureStructure
Enabling Process Enabling Process and Technologiesand Technologies
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Marketing Focus Evolution : From Production to Customer Relationship
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Lastly Trend : From Value to Holistic Marketing
Holistic marketing sees itself as integrating the value exploration, value
creation, and value delivery activities with the purpose of building long-term, mutually
satisfying relationships and coprosperity among key stakeholders.
Sources : Philip Kotler, Marketing Management, Prentice Hall, 2009
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The Marketer Strategic Task : Creating Holistic Marketing
3.Value delivery 3.Value delivery
1.Value exploration1.Value exploration(formulation)(formulation)
2.Value creation2.Value creation
Marketer - Marketer - Value Value Based StrategyBased Strategy
Created by Bermand
4. Customer 4. Customer RelationshipRelationship
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Summary of Value Based Marketing
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Thank You