I.

Planning Marketing Partnering to build customer relationships

- The company’s strategic plan establishes what kinds of businesses the company will operate and its
objectives for each
- within each business unit, more detailed planning takes place.
- The major functional departments in each unit work together to accomplish strategic objectives
- Marketing role in company strategy
+ provides a guiding philosophy—the marketing concept
+ provides inputs to strategic planners by helping to identify attractive market opportunities and
assessing the firm’s potential.
+ designs strategies for reaching the unit’s objectives
- Customer engagement and value: key in formula success of marketing
- Only partner in attracting, engaging, and growing customers
- partner relationship management: work closely with other departments to form an effective internal
value chain and external value delivery network
1. Partnering with other company departments
- Each company department: a link in the company’s internal value chain, carries out value-creating
activities to design, produce, market, deliver, and support the firm’s products
- Eg: True Value Hardware: Marketers at the retail-owned cooperative, information technology people
- A company’s value chain is only as strong as its weakest link
- in practice, interdepartmental relations are full of conflicts and misunderstandings
2. Partnering with others in marketing system
- the firm needs to look beyond its own internal value chain and into the value chains of its suppliers, its
distributors, and, ultimately, its customers.
- Eg: McDonald
- More companies today are partnering with other members of the supply chain— suppliers,
distributors, and, ultimately, customers—to improve the performance of the customer value delivery
network.
- Competition takes place between the entire value delivery network created by these competitors
- Eg: Ford vs Toyota
II. Marketing strategy and the marketing mix
- The strategic plan defines the company’s overall mission and objectives.
- Consumer: center
- Goal: create value, build relationship
- Marketing strategy: marketing logic to create customer value, achieve profitable relationship
- The company decides which customers it will serve (segmentation and targeting) and how
(differentiation and positioning).
- Then, design marketing mix made of factors under control
1. Customer value-driven marketing strategy
- To succeed in today’s competitive marketplace, companies must be customer centered.
- first understand customer needs and wants. Thus, sound marketing requires careful customer analysis.
- Too many consumers => cannot serve all => divide: market segmentation, market targeting,
differentiation, and positioning.
a. Market segmentation
- Consumers can be grouped and served in various ways based on geographic, demographic,
psychographic, and behavioral factors. This process is called market segmentation.
- Not all useful. Eg: Tylenol
- A market segment consists of consumers who respond in a similar way to a given set of marketing
efforts
b. Marketing targeting
- Market targeting involves evaluating each market segment’s attractiveness and selecting one or more
segments to enter.
- A company with limited resources might decide to serve only one or a few special segments or market
niches. Such niches specialize in serving customer segments that major competitors overlook or ignore
- The L’Oréal group serves major segments of the beauty market, and within each segment it caters to
many sub segments
- Most companies enter a new market by serving a single segment; if this proves successful, they add
more segments. Eg: Nike
- Market differentiation and Positioning
- how to differentiate its market offering for each targeted segment and what positions it wants to
occupy in those segments
- Positioning is arranging for a product to occupy a clear, distinctive, and desirable place relative to
competing products in the minds of target consumers
- Positioning is arranging for a product to occupy a clear, distinctive, and desirable place relative to
competing products in the minds of target consumers. Eg: , Southwest Airlines
- In positioning its brand, a company first identifies possible customer value differences that provide
competitive advantages on which to build the position.
- effective positioning begins with differentiation—actually differentiating the company’s market
offering to create superior customer value.
Next, we move to another part which is Planning Marketing Partnering to build customer
relationships.
The company’s strategic plan will direct the company how to operate and reach its objectives.
Marketing is essential for this strategic planning process: providing a guiding philosophy—the
marketing concept, providing inputs to strategic planners, designing strategies for reaching the unit’s
objectives. Finally, helping carry these objectives out profitably. Customer engagement and value are
the key ingredients in the marketer’s formula. Besides customer relationship, they must also practice
partner relationship to form an effective internal value chain as well as an external value delivery
network.
Now, we will take a deep look into these contents.
Firstly, Partnering with other company departments. Each company department is a link in the
company’s internal value chain, adds value to create product from designing to supporting. For
example, simply, talking about a system of a university, to create learning value and satisfaction for an
educational environment, each department has to work together to run the school and support students
smoothly. Therefore, a company’s value chain is only as strong as its weakest link. On theory,
company’s different functions should work in harmony. But, practically, due to some unexpected
matters, there will be conflicts and misunderstandings. So, marketers must find ways to get all
departments to “think consumer” and develop a smoothly functioning value chain.
Secondly, partnering with others in the marketing system, the firm needs to look into the value
chains of its suppliers, its distributors, and, ultimately, its customers. For instance, McDonald’s attracts
customers not only with its food products, but also with its well-designed value delivery system that
provides QSCV—quality, service, cleanliness, and value. It can be seen clearly that companies
compete not only with individual rivals, but also with the entire value delivery network created by
these rivals.
After building partnering relationships, another important step is marketing strategy and the
marketing mix.
The strategic plan defines the company’s overall mission and objectives, in which consumers are in the
center. The company will use a marketing strategy to create value for customers and build profitable
customer relationship. Through that, the company designs an integrated marketing mix made up of
factors under its control—product, price, place, and promotion (the four Ps).
First, Customer value-driven marketing strategy. Companies must be customer centered to succeed
in competitve market. They must understand their customers’ needs and wants, and careful analysis
before making them satisfied. Because of too many kinds of consumers with different needs,
companies must carry out the process of market segmentation, market targeting, differentiation, and
positioning.
About Market Segmentation, geographic, demographic, psychographic, and behavioral factors will
affect the way company groups and serves different kinds of consumers. This process is called market
segmentation. Not all ways of segmenting a market are equally useful. Eg: divide poor and rich
Market Targeting involves evaluating each market segment’s attractiveness and selecting one or
more segments to enter. A company with limited resources might decide to serve only one or a few
special segments or market niches that major competitors overlook or ignore. Most companies start
with one segment and then add more if successful.
Market differentiation and Positioning. A company needs to decide how to differentiate market
offering and appeal to each segment it wants to enter. Positioning means making the product stand out
from competing products in the minds of target consumers. For example, Southwest Airlines. To
position its brand, a company first finds possible customer value differences that give it an edge over
competitors. Thus, effective positioning starts with differentiation—making the market offering better
for customers.