©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 11 ©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

11 ©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Marketing: Building Profitable Customer Connections 2 LO1What are the objectives, processes and scope of marketing? LO2What is the customer’s role in marketing? LO3What are the elements of the marketing strategy? LO4What is the decision-making process for consumers? Businesses? LO5What are the key elements of marketing research? LO6How have social responsibility and technology impacted marketing?

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. American Marketing Association Definition 3 Marketing – the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Marketing: Getting Value by Giving Value 4 The ability of goods and services to satisfy wants. Form Utility Time Utility Place Utility Ownership Utility

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. The Scope of Marketing: It’s Everywhere! 5 People Marketing Place Marketing Event Marketing Idea Marketing

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. The Evolution of Marketing: From the Product to the Customer 6

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. The Marketing Concept The marketing concept is a philosophy that makes customer satisfaction—now and in the future— the central focus of the entire organization. Unmatched value to customers is the only way to long-term profitability. 7

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. The Customer: Front and Center 8 Limited Relationships Full Partnerships Customer Relationship Management (CRM) Value Customer Satisfaction Customer Loyalty

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Customers must believe that your product is simply uniquely qualified to meet their needs Perceived Value versus Actual Value 9 Low cost does not mean value Value is a relationship between cost and benefits Loyal customers will pay more for their products Creating value is not enough

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Customer Satisfaction You have satisfied customers when you deliver perceived value above and beyond their expectations, but  Don’t overpromise  Don’t underpromise 10

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Marketing Strategy 11 Marketing Plan – organizations may have a formal or informal plan that directs their efforts Marketing Segmentation – the first step in planning your marketing strategy Who are the people who will buy the products? Divide the market into groups of people and segments to target (target market)

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. A Well Chosen Target Market 12  Size  Profitability  Accessibility  Limited Competition

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Consumer Markets versus Business Markets 13 How will the buyer use the product? Consumer MarketsBusiness Markets Products for personal consumption Products used directly or indirectly to produce other products Different approaches to select target markets.

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Consumer Market Segmentation 14 Demographic Geographic Psychographic Behavioral Marketers may select multiple segments to target

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Business Market Segmentation 15 Geographic Customer-based Product-use based

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. The Marketing Mix 16

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. The Marketing Environment Markets must conduct environmental scanning to analyze the external environment External environment includes competition and market share analysis Key external factors must be considered:  Economic  Social/Cultural  Technological  Political/Legal 17

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. The Global Marketing Environment The world market has become more accessible to every business Understanding the marketing environment is more important Researching opportunities in other countries is a growing challenge 18

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Customer Behavior: Decisions! Decisions! Decisions! 19 Understanding customers is critical Why do people by one product but not another? How do they use the products they buy?

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Elements That Influence the Consumer Decision-Making Process 20

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Consumer Decision Process 21 Postpurchase Behavior Evaluation of Alternatives Purchase Decision Information Search Need Recognition

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Business Buyer Behavior Buying products to produce other products Purchasers have training and apply rationale Buy according to purchase specifications and objective standards Input from multiple internal sources Formal process for highly customized goods, services and prices 22

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Marketing Research: So What Do They REALLY Think? 23 Identify external opportunities Monitor and predict customer behavior Evaluate and improve marketing mix Marketing research involves gathering, interpreting, and applying information to uncover opportunities and challenges

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Research Data Comparison 24 Secondary Data: Existing Data Primary Data: New Data that is Compiled Lower CostMore Expensive May not be SpecificCustomized Frequently OutdatedFresh, New Available to CompetitorsProprietary

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Primary Research Tools 25 Observation Research – the researcher does not directly interact with the research subject Scanner Data Traffic counters Garbage Analysis Survey Research – the researcher does interact with the research subjects Questionnaires Interviews Focus Groups

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. An International Perspective Market research in other countries can be complicated Very few home phones in Latin America In the Middle East, knocking on doors is a crime Many firms hire local professionals for international market research 26

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Marketing and Society Leading-edge marketers have set high standards in: Environmentalism Abolishment of sweatshops Community outreach 27 A few examples: Starbucks Target General Electric

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Technology and Marketing: Power to the People! Technology is shifting power to the consumer Consumers have 24/7 access to products and information all over the world Consumer expectation has increased Companies have more opportunities to mass customize products Data can be used to develop one-to-one relationships with customers The digital boom has created a variety of promotional opportunities 28

©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 11 ©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Looking Back What are the objectives, processes and scope of marketing? What is the customer’s role in marketing? What are the elements of the marketing strategy? What is the decision-making process for consumers? Businesses? What are the key elements of marketing research? How have social responsibility and technology impacted marketing? 29