CHAPTER 0NE:

MARKETING
CREATING CUSTOMER VALUE & ENGAGEMENT
CHAPTER OBJECTIVES
• Defining marketing

• Understanding the marketplace and customer needs

• Designing the customer value driven marketing strategy and plan

• Managing customer relationship and capturing customer value

WHAT IS MARKETING?
• Marketing is not only selling and advertising

• Marketing is not a specialized activity at all; it encompasses the entire business

• Marketing, more than any other business function, deals with customers

• It is the whole biz seen from the point of view of the final result-the customer’s point of view

• It is not just your product, price, promotion & distribution …

• Marketing is the process by which companies engage customers, build strong customer relationships, create
customer value to capture value from customer in return

Marketing is too important to be left with the marketing dept. only- David Packard
THE MARKETING PROCESS

Understand the
marketplace & customer
needs & want
THE MARKETING PROCESS

Understand the
Design a customer value
marketplace & customer
driven marketing strategy
needs & want
THE MARKETING PROCESS

Understand the Construct an integrated

Design a customer value
marketplace & customer marketing program that
driven marketing strategy
needs & want delivers superior value
THE MARKETING PROCESS

Construct an Engage customers,

Understand the
Design a customer integrated build profitable
marketplace &
value driven marketing program relationships, &
customer needs &
marketing strategy that delivers create customer
want
superior value delight
 THE MARKETING PROCESS

Construct an Engage Capture value

Understand the Design a customer integrated customers, build
from customers
marketplace & value driven marketing profitable
customer needs & marketing program that relationships, &
to create profits
want strategy delivers superior create customer & customer
value delight equity
 THE MARKETING PROCESS
Create value for customers and build customer Capture value from
relationships customers in return

Construct an Engage
Understand the Design a customer integrated customers, build Capture value
marketplace & value driven marketing profitable from customers to
customer needs & marketing program that relationships, & create profits &
want strategy delivers superior create customer customer equity
value delight
Step 1: Understand The Marketplace & Customer Needs & Wants
Customer Needs, Wants, and Demands

 Needs
Discussion topic:
 Wants Do marketers create
needs?
 Demands

Market offerings- Products, Services, and Experiences

 Products

 Services
 Experiences
Some sellers suffer from Marketing Myopia

The one thing that every company should ask themselves is What business are we really in?
Step 1: Understand The Marketplace & Customer Needs & Want
• Customer Value & Satisfaction

• Exchange & Relationship

 Response may be more than buying & selling product

• Markets
 Step 2: Design a customer value driven marketing strategy
• What customers will we serve?
Details in Chapter 2 & 7
• How can we serve them best?
Marketing Management Orientations

The production concept

The product concept Starting

Focus Means Ends
point

Existing Selling & Profits thru

The selling concept Factory
Prod. promotion sales vol.

Customer Integrated Thru customer

The Marketing concept Market
needs marketing satisfaction

‘If I has asked people what they wanted, they would have said faster horses.’
Henry Ford
Marketing management orientations

The production concept

The product concept

Society
(human welfare)

The selling concept

The Marketing concept Societal Marketing

concept

The Societal Marketing concept

Consumers Company
(want satisfaction) (Profits)
Marketing management orientations

The production concept

The product concept

The selling concept

The Marketing concept

The Societal Marketing concept

The Holistic Marketing concept

Marketing management orientations

If you take care of your employees,

they will take care of your clients.
Internal -Richard Branson Integrated
marketing marketing

Holistic
Marketing

Performance Relationship
marketing marketing
Step 3: Preparing an Integrated Marketing Plan & Program
• Transforming the marketing strategy into action

• Blend each marketing mix tools (4P’s) into a integrated marketing program
Step 4: Managing customer relationship & Capturing Customer Value
• Customer Relationship Mgt (CRM)
 Customer Perceived Value
“It’s a small price to pay for the value of owning one”
“My friendship with Steinway Piano is one of the most beautiful things in my life”

 Customer Satisfaction (Satisfied/dissatisfied/delighted)

NOTICE
• I do not consider a sale complete until goods are worn out and customers are still
satisfied.
• We will thank anyone to return goods that are not perfectly satisfactory
• Should the person reading this notice know anyone who is not satisfied with our
goods, I will consider it a favor to be notified.
• Above all things we wish to avoid having a dissatisfied customer. L. L. Bean

 Customer Relationship levels & tools

Step 4: Managing customer relationship & Capturing Customer Value
• Customer Engagement in today’s digital & social media
 Customer engagement marketing
 Consumer generated marketing
 Example: Airbus A330neo model
 Partner Relationship Management
Step 5: Capturing value from customers
• Creating Customer Loyalty & Retention
Rule 1: The Customer is always right!
Rule 2: If the customer is ever wrong, Reread Rule 1.
Stew Leonard
• Growing share of Customer.
Example: amazon.com
• Building customer equity.

51% (in 1976) Market share took time to grow, beat Cadillac in 1980
60 Customer’s Avg age 40
Customer Equity

Marketers should not be complacent with current sales & market share. Customer lifetime value & equity are the
name of the game
Right Relationship with the Right Customers

High

Potential Profitability
Butterflies True friends

Strangers Barnacles

Low
ST LT
Projected Loyalty
The Changing Marketing Landscape
• The Digital Age:
Online marketing
Mobile marketing
Social media marketing

• Rapid globalization
• Sustainable marketing: The call for more environmental & social responsibility
 Assignment of Chapter 1
• At the end of chapter 1, there are some key terms. Briefly write down your understanding of these terms. Please
don’t write the definition as per book/online source. If found, you will get 0. (Individual)

• Take a company & study about the marketing activities of it & discuss the marketing orientation they are
currently following & which one they should follow (in group)

• Read the chapter ending case ‘Argos: Creating customer value amid Change and turbulence’ and answer the
questions in ppt format and be ready to present in the class. (in group)

Submission: first one in word file (keep with yourself) & the 2nd & 3rd ppt thru email.

Deadline of submission: January 22, 2019; 8PM Sharp

END OF CHAPTER ONE