1. Chapter 1
Marketing in a Changing World: Creating Customer Value and Satisfaction

2. What is Marketing?
Process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others.
Simply put: Marketing is the delivery of customer satisfaction at a profit.

3. Core Marketing Concepts (Fig. 1-1)
Needs, wants,
and demands
Markets
Products
and services
Exchange,
transactions,
and relationships
Value,
satisfaction,
and quality

4. What are Consumer’s Needs, Wants and Demands?
Needs - state of felt deprivation for basic items such as food and clothing and complex needs such as for belonging. i.e. I am hungry.
Wants - form that a human need takes as shaped by culture and individual personality. i.e. I want a hamburger, French fries, and a soft drink.
Demands - human wants backed by buying power. i.e. I have money to buy this meal.

5. What Will Satisfy Consumer’s Needs and Wants?
Products
Anything that can be Offered to a Market to Satisfy a Need or Want
Experiences
Persons
Places
Organizations
Ideas
Information
Services
Activities or Benefits Offered for Sale That Are Essentially
Intangible and Don’t Result in the Ownership of Anything

6. How Do Consumers Choose Choose Among Products and Services?
Value Gained From Owning a Product and Costs of Obtaining the Product is Customer Value
Product’s Perceived Performance in Delivering Value Relative to Buyer’s Expectations is Customer Satisfaction
Total Quality Management Involves Improving the Quality of Products, Services, and Marketing Processes

7. How Do Consumers Obtain Products and Services?
Exchanges
Transactions
Relationships
Building a Marketing
Network Consisting of
The Company and All
Its Supporting
Stakeholders

8. Who Purchases Products and Services?
People Who Exhibit Need
Factors
Situational
Unexpected
Attitudes of
Others
Ethical
Potential Buyers
Market – Buyers who share a particular need or want that can be satisfied through exchange or relationships.
Actual Buyers
Resources to Exchange
Willingness to Exchange

9. Modern Marketing System (Fig. 1-3)
Suppliers
Modern Marketing System (Fig. 1-3)
Competitors
Company
(Marketer)
Marketing
Intermediaries
Environment
End User
Market
Environment

10. Marketing Management Demand Profitable Marketing Management Management
Implementing
programs
to create
exchanges
with target
buyers
to achieve
organizational
goals
Demand
Management
Finding and
increasing
demand, also
changing or
reducing
demand such
as in
Demarketing
Profitable
Customer
Relationships
Attracting new
customers and
retaining and
building
relationships
with current
customers

11. Marketing Management Practice
Stage 1. Entrepreneurial Marketing
Stage 2. Formulated Marketing
Stage 3. Intrepreneurial Marketing

12. Marketing Management Philosophies
Consumers favor products that are
available and highly affordable.
Improve production and distribution.
Consumers favor products that offer
the most quality, performance, and
innovative features.
Consumers will buy products only if
the company promotes/ sells these
products.
Focuses on needs/ wants of target
markets & delivering satisfaction
better than competitors.
markets & society’s welfare.
Production Concept
Product Concept
Selling Concept
Marketing Concept
Societal Marketing Concept

13. Marketing and Sales Concepts Contrasted
Factory
Existing
Products
Selling
and
Promoting
Profits
through
Volume
The Selling Concept
Starting
Point
Focus
Means
Ends
Market
Customer
Needs
Integrated
Marketing
Profits
through
Satisfaction
The Marketing Concept

14. Societal Marketing Concept
Society
(Human Welfare)
Societal
Marketing
Concept
Consumers
(Want Satisfaction)
Company
(Profits)

16. Marketing Challenges in the New “Connected” Millennium
Connections with Customers
Connecting more selectively
Connecting for life
Connecting Directly
Connecting
Technologies
Computer
Information
Communication
Transportation
Connections with the world around us
Global Connections
Connections with values and responsibilities
Broadened connections
Connections with Marketing Partners
Connecting with other company departments
Connecting with suppliers and distributors
Connecting through strategic alliances
Text page 23

17. Technologies for Connecting
Learn About &
Track Customers
With Databases
Create Products &
Services Tailored to
Meet Customer Needs
Connecting Technologies in
Computers,
Telecommunications,
Information, & Transportation
Help To:
Communicate With
Customers in Groups
Or One-on-One
Distribute Products
More Efficiently &
Effectively

18. The Internet
The Internet has been hailed as the technology behind a new model for doing business.
New applications include:
Internet – connecting with customers,
Intranets – connecting with others in the company, and
Extranets – connecting with strategic partners, suppliers, and dealers.
Purchasing will be over $1.4 trillion in 2003.
400,000 companies are now using the Internet to do business.

19. Connections With Customers
Most marketers are targeting fewer, potentially more profitable customers.
Asking:
What value does the customer bring to the organization?
Are they worth pursuing?
Focus has shifted to:
keeping current customers, and
building lasting relationships based on superior satisfaction and value.

20. Direct Connections With Customers
Many companies use technologies to let them connect more directly with their customers.
Products available via telephone, mail-order catalogs, kiosks and e-commerce.
Some firms sell only via direct channels (i.e. Dell Computer, others use a combination.
Direct marketing is redefining the buyer’s role in connecting with sellers.
Buyers are active participants in shaping the marketing offer and process; some buyers design their own products online.

21. Connections With Marketing’s Partners
Connecting Inside the Company
Every employee must be customer-focused
Teams coordinate efforts toward customers
Connecting With Outside Partners
Supply Chain Management
Strategic Alliances

22. Connections With the World Around Us
Global
Connections
Broadening
Connections
Values
Connections
Social Responsibility
Connections

23. Review of Concept Connections
Define what marketing is and discuss its core concepts.
Explain the relationships between customer value, satisfaction, and quality.
Define marketing management and examine how marketers manage demand and build profitable customer relationships.
Compare the five marketing management philosophies.
Analyze the major challenges facing marketers heading into the next millennium.