Chapter 1: Marketing: Managing Profitable Customer Relationships

 

Objectives
  • •Be able to define marketing
    and discuss its core concepts.
  • •Be able to define marketing management and compare the five marketing management orientations.
  • •Understand customer relationship management and strategies.
  • •Realize the major challenges facing marketers in the new “connected” millennium.

 

 

Please Open The Following Figures In Different Windows and Leave Them Open:

 

 

Case Study

Amazon.com
  • •Strong sales, no profits
  • •Customer-driven to its core
  • •Each customer’s experience is unique

 
  • •Provides great selection, good value, discovery and convenience
  • •A true online community
 

 

Discussion:  Will Amazon.com Survive?

 

 

What is Marketing?
•Marketing is managing profitable customer relationships
  • §Attracting new customers
  • §Retaining and growing current customers
•“Marketing” is NOT synonymous with “sales” or “advertising”

 

 

What is Marketing?
  • •Kotler’s social definition:
  •  “Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others.”
 

 

 

What is Marketing?

Many Things Can Be Marketed!
  • •Goods
  • •Services
  • •Experiences
  • •Events
  • •Persons

 
  • •Places
  • •Properties
  • •Organizations
  • •Information
  • •Ideas
 

 

 

What is Marketing?

Core Marketing Concepts
  • •Needs, wants, and demands
  • •Marketing offers: including products, services and experiences
  • •Value and satisfaction
  • •Exchange, transactions and relationships
  • • Markets
 

 

 

 

Marketing Management
  • •Marketing management is “the art and science of choosing target markets and building profitable relationships with them.”
  • §Creating, delivering and communicating superior customer value is key.
 

 

 

Marketing Management
  • •Customer Management:
§       Marketers select customers that can be served well and profitably.
  • •Demand Management:
§       Marketers must deal with different demand states ranging from no demand to too much demand.

 

 

Marketing Management
Management Orientations
  • •Production concept
  • •Product concept

 
  • •Selling concept
  • •Marketing concept
 

  •  Societal marketing concept

 

 

CRM
 
•CRM – Customer relationship  management . . .
“is the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.”
 

 

 

CRM
 
•
  • •It costs 5 to 10 times MORE to attract a new customer than it does to keep a current customer satisfied.
  • •Marketers must be concerned with the lifetime value of the customer.
 

 

 

CRM
 
•
Key Concepts
  • •Attracting, retaining and growing customers

     

     

  • •Building customer relationships and customer equity
 

 

 
•Customer value/satisfaction
  • §Perceptions are key
  • §Meeting/exceeding expectations creates satisfaction
•Loyalty and retention
  • §Benefits of loyalty
  • §Loyalty increases as satisfaction levels increase
  • §Delighting consumers should be the goal
•Growing share of customer
  • §Cross-selling
 

 

 

CRM
 
•
Key Concepts
  • •Attracting, retaining and growing customers

     

     

  • •Building customer relationships and customer equity
 

 

 
•
•Customer equity
  • §The total combined customer lifetime values of all customers.
  • §Measures a firm’s performance, but in a manner that looks to the future.
 

 

 

CRM
 
•
Key Concepts
  • •Attracting, retaining and growing customers

     

     

  • •Building customer relationships and customer equity
 

 

 
•
•Customer relationship levels and tools
  • §Target market typically dictates type of relationship
       Basic relationships
       Full relationships
§
  • Customer loyalty and retention programs

   Adding financial benefits

        Adding social benefits
        Adding structural ties
 

 

 

 

Marketing Challenges
  • •Technological advances, rapid globalization, and continuing social and economic shifts are causing marketplace changes.
  • •Major marketing developments can be grouped under the theme of Connecting.
 

 

 

 

Marketing Challenges
Connecting
  • •Via technology

     

  • •With customers

     

  • •With marketing partners

     

  • •With the world
 

 
  • •Advances in computers, telecommunications, video-conferencing, etc. are major forces.
  • §Databases allow for customization of products, messages and analysis of needs.
  • •The Internet
  • §Facilitates anytime, anywhere connections
  • §Facilitates CRM
  • §Creates marketspaces

 

 

 

Marketing Challenges
Connecting
  • •Via technology

     

  • •With customers

     

  • •With marketing partners

     

  • •With the world
 

 
  • •Selective relationship management is key.
  • §Customer profitability analysis separates winners from losers.
  • •Growing “share of customer”
  • §Cross-selling and up-selling are helpful.
  • •Direct sales to buyers are growing.
 

 

Marketing Challenges
Connecting
  • •Via technology

     

  • •With customers

     

  • •With marketing partners

     

  • •With the world
 

 
  • •Partner relationship management involves:
  • §Connecting inside the company
  • §Connecting with outside partners
         Supply chain management
         Strategic alliances
 

 

Marketing Challenges
Connecting
  • •Via technology

     

  • •With customers

     

  • •With marketing partners

     

  • •With the world
 

 
 
  • •Globalization
  • §Competition
  • §New opportunities
  • •Greater concern for environmental and social responsibility
  • •Increased marketing by nonprofit and public-sector entities
  • §Social marketing campaigns
 

 

Chapter 1: Marketing: Managing Profitable Customer Relationships

 

Study Guide
  • Concepts Check

 

Study Guide
  • Concepts Challenge

 

 
  • Chapter Outline

 

 
  • Video Case

 

 
  • PowerPoint Express - kotler01_exs.PPT                  
  • Chapter 1 Power point

 

 

 

 

 

See the full chapter at

Principles of Marketing by Kotler & Armstrong  Try Two Chapters!

(active Book) (Course)

Principles of Marketing (activebook 2.0 ), 10/e (Kotler, Armstrong).

Chapter 1: Marketing: Managing Profitable Customer Relationships.

 Chapter 16: Advertising, Sales Promotion, and Public Relations

 

BACK

Chapter 1: Marketing: Managing Profitable Customer Relationships

 

 

PowerPoint Express - kotler01_exs.PPT                  

Chapter 1 Power point