Customer Value, Satisfaction, Customer Relationships and Customer Experiences. Chapter 1

In this section we will: Define Marketing. Discover the basic requirements for marketing to occur. Understand the Role of Marketing in our Society Distinguish between the controllable marketing mix elements and uncontrollable environmental marketing elements. Develop an understanding of how marketing has evolved over time. Understand how ethical issues can creep into marketing decisions.

A Marketing Expert Unlike many other business subjects, Marketing is something that we are exposed to each and every day - - as a result we are marketing experts.

Definition of Marketing Marketing is: A Process of Planning and Doing… The Conception (Product), the Pricing, The Promotion and the Distribution (Place)… Of an Idea, Good or Service… To create and Exchange.. To satisfy Individual or Organizational Objectives. Marketing Discovers needs & wants and attempts to satisfy them.

For Marketing to Occur there needs to be: Two or more parties (a Buyer & a Seller) that have needs that each other can fulfil. A Desire, and an Ability to satisfy these needs. (A Market) A way to Communicate this desire to the other party. Something of value to Exchange.

Key Questions of Marketing Who Markets - Profit and Not-for-profit, government and individuals. What is marketed - Goods, Services and Ideas. Who Buys what is marketed - Individuals and Organizations. Who Benefits - Individuals and Organizations

Finding a need Sometimes satisfying a need proves to be a difficult task. To narrow in on the needs of a diverse group of potential customers, companies often group people by their needs. These groups are known as Target Markets. Target Markets will respond similarly to a given set of marketing actions.

Value The combination of benefits offered to the customer relative to the price paid. Quality = increased customer value.

The Marketing Mix “The 4 P’s” These are the controllable factors that a company/organization can adjust in order to satisfy customer needs. They include: The Product ( The Good, Service or Idea sold) The Promotion ( How the product is communicated to the potential buyer) The Price (The rate of exchange) The Place ( How the product is distributed to the customer)

Influences on Marketing Certain aspects of marketing are controllable: Product, Price, Place & Promotion. Other aspects of the environment in which marketing occurs must be dealt with, but cannot be changed: Social Forces, Economic Forces, Technological Forces, Competitive Forces and Regulatory Forces.

Environmental Influences These are factors external to the company/organization that it has no direct control over. These factors must be dealt with. These include: Social Factors - Aspects of Demographic Change and Cultural Change. Economic Factors - People’s income and inflation

Environmental Influences cont... Technological Factors - Changes in technology and the effects of this change. Competitive Factors - What competitors are doing. Regulatory Factors - Government and Industry regulation and how it impacts on the business.

Eras of Marketing Production Era ’s ’s - Customers would buy all that was produced because they simply could not buy these newly-invented items before. The Focus in this era was on developing the production process (e.g. Assembly lines), not on satisfying customer needs. Henry Ford’s philosophy of “you can have any colour you want; provided its black” was the prevailing tone of manufacturers. Customers had little choice but accept this. Mid ’s Now 1930’s The Great Depression 1960’s Baby Boomers come of age Mid -1980’s The Computer age Industrial Revolution

Eras of Marketing cont... Sales era ’s ’s - During this time the world went through a depression and a war. Production capacity was well developed however the buying public had less money to buy these new products and competition among specific manufactures was stiff. The focus was on the hard sell. “We’ve built it, so you better buy it” was the prevailing philosophy. Again the interests the customer were secondary compared to the interests of manufacturers. Mid ’s Now 1930’s The Great Depression 1960’s Baby Boomers come of age Mid -1980’s The Computer age Industrial Revolution

Eras of Marketing cont... Marketing Concept Era ’s ’s - The emergence of Japanese competition in the late 60’s and 70’s and the increased activism of customers who demanded better quality products force manufactures to finally consider the customer when developing and marketing products. Customers were better educated, better aware and demanded “value”. Mid ’s Now 1930’s The Great Depression 1960’s Baby Boomers come of age Mid -1980’s The Computer age Industrial Revolution

Eras of Marketing cont... Market Orientation Era / Customer Experience Era- 1990’s - The advent of computers and massive data gathering allow companies to better determine customer needs. Product lives are shorter and competition is stiff to please the customer and build long-term relationships. Customer Value Customer Satisfaction Customer Relationship Management Customer Lifetime Value Interactive Marketing Mid ’s Now 1930’s The Great Depression 1960’s Baby Boomers come of age Mid -1980’s The Computer age Industrial Revolution

Eras of Marketing cont... Social Media: Market Orientation Era / Customer Experience Era- NOW – Social Media is made up of user friendly internet based website that allow three way communication – between buyer and seller, seller and buyer and buyer and buyer. The content is largely CONSUMER based. Mid ’s Now 1930’s The Great Depression 1960’s Baby Boomers come of age Mid -1980’s The Computer age Industrial Revolution

Social Responsibility The Societal Marketing Concept -- Many large corporations have found that it is good business to be responsible for the society in which they operate.

Micro/Macro Marketing Micromarketing - looks at how the individual corporation markets. Macromarketing - Looks at the impact of marketing, as a whole, on society.