Principles of Marketing
Marketing: Defining Marketing and the Marketing Process
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What Is Marketing?
Marketing is a process by which companies create value for customers and
build strong customer relationships in order to capture value (usually, $$)
from customers in return.
Said differently: Marketing is about the exchange of values.
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Understanding the Marketplace and Customer Needs
Customer Needs, Wants, and Demands
Needs
• States of deprivation
Wants
• Form that needs take
Demands
• Wants backed by buying power
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Understanding the Marketplace and Customer Needs
Market “Offerings” = Products, Services, and/or Experiences
• Market offerings are
some combination of
products, services,
information, or
experiences offered to a
market to satisfy a need
or want.
• Marketing myopia is
focusing only on existing
wants and losing sight of
underlying consumer
needs.
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Understanding the Marketplace and Customer Needs
Markets
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Designing a Customer Value-Driven Marketing Strategy
Selecting Customers to Serve
Marketing management is the art and science of choosing
target markets and building profitable relationships with
them.
• What customers will we serve?
• How can we best serve these customers?
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Designing a Customer Value-Driven Marketing Strategy
Selecting Customers to Serve
Market segmentation refers to dividing the markets into
segments of customers.
Targeting refers to which segments to go after.
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Designing a Customer Value-Driven Marketing Strategy
Choosing a Value Proposition
A company’s value
proposition is the
set of benefits or
values it promises
to deliver to
customers to
satisfy their needs.
Things you will typically find in a value proposition: “we
are better”… “we are bigger”… “we are faster”… “our
price is right”… “we get the job done”.
Examples of value propositions:
“Wal-Mart is the leader in low prices and
huge selection”
Note: a mere catch phrase is NOT a value
proposition, ex: « L’Oréal. Because we’re
worth it. » This is not a value proposition!
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Designing a Customer Value-Driven Marketing Strategy
YOUR TURN…
How to segment Highlands’ customers?
What is/are Highlands’ main target market(s)?
Come with a value proposition for Highlands
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Designing a Customer Value-Driven Marketing Strategy
Different Marketing Management Orientations:
Production
concept
Product
concept
Selling
concept
Marketing
concept
Societal
Marketing
concept
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Designing a Customer Value-Driven Marketing Strategy
“Marketing concept”:
Know the needs and wants of the target markets and deliver
the desired satisfactions better than competitors.
How to know those “needs and wants”? Conduct a customer satisfaction survey!
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Designing a Customer Value-Driven Marketing Strategy
“Societal marketing”:
The company’s marketing decisions should
consider consumers’ wants,
the company’s requirements,
consumers’ long-run interests,
and society’s long-run interests.
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Preparing a Marketing Plan
The marketing mix is the set of tools (“the four Ps”) the firm uses
to implement its marketing strategy. This set includes product,
price, promotion, and place.
Note: some people talk about
the “7 Ps”, instead of the 4
Ps… we’ll see that later !
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Building Customer Relationships
Customer Relationship Management
Customer relationship management or CRM is the overall
process of building and maintaining profitable customer
relationships by delivering superior customer value and
satisfaction.
Building Customer Relationships
Customer Relationship Management
Customer Relationship Levels and Tools
Basic Relationships
– low-margin
customers
Full Partnerships
– high-margin
customers
Frequency
Marketing
Programs – reward
customers
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Building Customer Relationships
Engaging Customers
Customer Engagement and Today’s Digital and Social Media
Customer-Engagement Marketing makes the brand a meaningful part of
consumers’ conversations and lives, by fostering direct and continuous
customer involvement.
Watch video: Tipp-Ex’s unique use
of Youtube to engage viewers
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Capturing Value from Customers
Creating Customer Loyalty and Retention
Customer lifetime value is the
value of the entire stream of
purchases that the customer
would make over a lifetime of
patronage.
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