Bulletlist - The Marketing Process

The Marketing Process:
Creating and Capturing Customer Value

The process by which companies engage customers, build strong customer
relationships, and create customer value in order to capture value from customers in
return.
 Create value for customers and build customer relationships
o Understand the marketplace and customer needs and wants

Marketing is all about creating value for customers. So, as the first step in the
marketing process, the company must fully understand customers and the
marketplace.
 needs, wants, and demands

 Need
stats of felt deprivation
 Want:
the form human need take as they are shaped by culture and
individual personality
 Demand:
A human wants that are backed by buying power
 market offerings (products, services, and experiences)
 Market offerings
Some combination of products, services, information, or
experiences offered to a market to satisfy a need or want.
 Marketing myopia
The mistake of paying more attention to the specific products a
company offers than to the benefits and experiences produced by
these products.
 customer value and satisfaction
 Set the right level of expectations. Not too high or low
 If performance is lower than expectations, satisfaction is low.
 If performance is higher than expectations, satisfaction is high.
 exchanges and relationships;
 The act of obtaining a desired object from someone by offering
something in return.
 Marketing consists of actions taken to create, maintain, and grow
desirable exchange relationships with target audiences involving a
product, service, idea, or other object.
 markets
 The set of all actual and potential buyers of a product or service.
M. AlQaisi/Oct.2018/Cairo
Arrows represent relationships that must be developed and
managed to create customer value and profitable customer
relationships.
o Design a customer value– driven marketing strategy

Once a company fully understands its consumers and the marketplace, it must
decide which customers it will serve and how it will bring them value.
 Marketing management
The art and science of choosing target markets and building profitable
relationships with them.
 Selecting Customers to Serve
 market segmentation
refers to dividing the markets into segments of customers
 Target marketing
refers to which segments to go after
 Demarketing
Temporarily or permanently reducing the number of customers or
shifting their demand.
 Choosing a Value Proposition
 the set of benefits or values a company promises to deliver to
customers to satisfy their needs
 They answer the customer’s question: “Why should I buy your
brand rather than a competitor’s?”
 Marketing Management Orientations
 production concept
The idea that consumers will favor products that are available and
highly affordable; therefore, the organization should focus on
improving production and distribution efficiency.
 product concept
The idea that consumers will favor products that offer the most
quality, performance, and features; therefore, the organization
should devote its energy to making continuous product
improvements.
 Selling concept
The idea that consumers will not buy enough of the firm’s products
unless the firm undertakes a large-scale selling and promotion
effort.
 Marketing concept
A philosophy in which achieving organizational goals depends on
knowing the needs and wants of target markets and delivering the
desired satisfactions better than competitors do.
 Societal marketing concept

The idea that a company’s marketing decisions should consider
consumers’ wants, the company’s requirements, consumers’ long-
run interests, and society’s long-run interests.
o Construct an integrated marketing program that delivers superior value

 marketing mix
the set of marketing tools the firm uses to implement its marketing
strategy. The major marketing mix tools are classified into four broad
groups, called the four Ps of marketing
 To deliver on its value proposition, the firm must first create a need-
satisfying market offering (product).
 It must then decide how much it will charge for the offering (price)
 and how it will make the offering available to target consumers (place).
 Finally, it must engage target consumers, communicate about the
offering, and persuade consumers of the offer’s merits (promotion).
o Engage customers, build profitable relationships, and create customer delight
 Customer relationship management CRM
The overall process of building and maintaining profitable customer
relationships by delivering superior customer value and satisfaction.
 Relationship Building Blocks
 Customer perceived value
The difference between total customer value and total
customer cost
 Customer satisfaction
The extent to which a product’s perceived performance
matches a buyer’s expectations
 Customer Relationship Levels and Tools.
 Basic Relationships
with many low-margin customers
 Full Partnerships
with few customers and high margins
 Customer Engagement and Today’s Digital and Social Media
 Customer-engagement marketing
Making the brand a meaningful part of consumers’ conversations
and lives by fostering direct and continuous customer involvement
in shaping brand conversations, experiences, and community.
 Consumer-generated marketing
Brand exchanges created by consumers themselves—both
invited and uninvited— by which consumers are playing an
increasing role in shaping their own brand experiences and
those of other consumers.
 customer-managed relationships
customers connect with companies and with each other to help
forge and share their own brand experiences.
 partner relationship management
Working closely with partners in other company departments and outside
the company to jointly bring greater value to customers.
 supply chain
a longer channel, stretching from raw materials to components to
final products that are carried to final buyers.
 Capture value from customers in return
o Capture value from customers to create profits and customer equity

 Creating Customer Loyalty and Retention
 Customer lifetime value
The value of the entire stream of purchases a customer makes
over a lifetime of patronage.
 Research also shows that it’s five times cheaper to keep an old
customer than acquire a new one.
 Growing Share of Customer
 Share of customer
The portion of the customer’s purchasing that a company gets in
its product categories.
 Building Customer Equity
 Customer equity The total combined customer lifetime values of
all of the company’s customers(current and potential).
 Building the Right Relationships with the Right Customers.

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The Marketing Process:

Creating and Capturing Customer Value

 Create value for customers and build customer relationships

o Understand the marketplace and customer needs and wants

 needs, wants, and demands

o Design a customer value– driven marketing strategy

 Societal marketing concept

o Construct an integrated marketing program that delivers superior value

 Capture value from customers in return

o Capture value from customers to create profits and customer equity

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