1. McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All Rights Reserved.

2. Introduction – Creating Customer Relationships & Value through Marketing Define marketing and identify the requirements for marketing to occur.. LO1 Explain how marketing discovers and satisfies consumer needs. Distinguish between marketing mix elements and environmental forces. LO2 1-2 LO3 LEARNING OBJECTIVES (LO) After reading Chapter 1, you should be able to :

3. Introduction – Creating Customer Relationships & Value through Marketing LO4 LO5 1-3 Explain how organizations build strong customer relationships and customer value through marketing. Describe how today’s customer relationship era differs from prior eras oriented to production and selling. LO6 Explain how marketing creates utilities for consumers. LEARNING OBJECTIVES (LO) After reading Chapter 1, you should be able to :

4. UNIQLO Unique Clothes, Unique Shopping Experience Opening Story – Uniqlo 1-4

5. ? AffordableAvailableStylishCasual Discovering Consumer’s Needs What do customers expect from clothes? Opening Story – Uniqlo 1-5

6. What is Marketing? Definitions and Examples Defining Marketing 1-6 LO1  Marketing Is NOT Easy  You are already a Marketing Expert

7. What is Marketing? Marketing is about Delivering Benefits Defining Marketing 1-7 LO1  Uniqlo, Marketing and You  Marketing : Using Exchanges to Satisfy Needs  The Diverse Factors Influencing Marketing Activities

8. What is Marketing? Diverse Factors influence Marketing Activities Defining Marketing 1-8 LO1  Organization  Society  Environmental Forces

9. What is Marketing? How Marketing relates to people, groups and forces Defining Marketing 1-9 LO1

10. What is Marketing? Requirements for ‘Marketing’ Defining Marketing 1-10 LO1  Parties with Unsatisfied Needs  A Desire and Ability to be Satisfied  A Way for the Parties to Communicate  Something to Exchange

11. Discovering Consumer Needs How Marketing discovers Consumer Needs Consumer Needs 1-11 LO2  Customers may not know what they need or want  They may not know how to describe what they want  We must ask the right questions  Chapter 9: Market Segmentation

12. New Product Challenges How Marketing discovers Consumer Needs Consumer Needs 1-12 LO2  Most New Products Fail  The Challenge of New Products is to  Learn from the Past  Offer Consumers a New benefit

13. Benefits & Show-Stoppers Dr. Care Vanilla Mint Aerosol Toothpaste Consumer Needs 1-13 LO2

14. Benefits &Show-Stoppers Hot Pockets Bite-Sized Microwavable Snack Sensations Consumer Needs 1-14 LO2

15. Benefits & Show-Stoppers A Flying Car! Consumer Needs 1-15 LO2

16. Benefits & Show-Stoppers Diet Cola with Ginseng & Extra Caffeine Consumer Needs 1-16 LO2

17. Needs vs Wants An important distinction Consumer Needs 1-17 LO2  Need  Want  Does Marketing persuade people to buy the “Wrong” Things?  Can Marketers create Needs?

18. What is a Market? Who is a ‘consumer’? Consumer Needs 1-18 LO2 Potential consumers = People with both the desire & ability to buy a specific product Potential consumers Whole population

19. Discovering Consumer Needs The first task is to discover consumer needs Consumer Needs 1-19 LO2

20. The Marketing Mix : 4 P’s Controllable Market Factors Marketing Mix 1-20 LO3 Promotion Place  Target Market : 1 or more specific potential consumer groups Target Market : 1 or more specific potential consumer groups Product Price $399  The 4 P’s: Controllable Marketing Mix Factors The 4 P’s: Controllable Marketing Mix Factors

21. Environmental Forces Uncontrollable Market Factors Marketing Mix 1-21 LO3 Technological Regulatory  Uncontrollable Environmental Forces (More to be discussed in Chapter 3) Uncontrollable Environmental Forces (More to be discussed in Chapter 3) Social Economic Competitive

22. Customer Relationships What is Value? Customer Relationships 1-22 LO4 Market Place: Premium- Priced, full-service with a wide range of international brand Sheng Siong: Low-priced, self-service, no-frills concept

23. Relationship Marketing As a Marketing Program Customer Relationships 1-23 LO4 Easy to Understand  Relationship Marketing Relationship Marketing Difficult to implement Building relationships with consumers  Marketing Program – integrating marketing mix to provide a good, services or idea Marketing Program – integrating marketing mix to provide a good, services or idea  Global Competition, Customer Value and Customer Relationships Global Competition, Customer Value and Customer Relationships

24. Creating Value The second task is to satisfy consumer needs Customer Relationships 1-24 LO4

25. UNIQLO’s Marketing Program Satisfying Consumer Needs Customer Relationships 1-25 LO4  Knowing Customers and Understanding their Needs and Wants  Developing Core Strategy and Concept  Assembling Right Mix of Product or Service, Price, Promotion and Place

26. UNIQLO’s Marketing Program 3 Distinct Shopper Segments Customer Relationships 1-26 LO4

27. Different Segments, Different Needs Distinct Products for Distinct Customer Relationships 1-27 LO4 ● Casual ● Fashionistas

28. Evolution of Market Orientation How Marketing became Important The Era of Customer Relationship Marketing 1-28 LO5  Production Era  Sales Era  Marketing Concept Era Marketing Concept Era  Customer Relationship Era Market Orientation Customer Relationship Management (CRM)

29. Evolution of Market Orientation How Marketing became Important The Era of Customer Relationship Marketing 1-29 LO5  Production Era Focused on Production; goods would ‘sell themselves’ Few products so buyers would accept anything E.g. 1910Sanyo – radios, bicycle lamps  Sales Era More products available; difficult to sell Hire salespeople to increase sales

30. Evolution of Market Orientation How Marketing became Important The Era of Customer Relationship Marketing 1-30 LO5  Marketing Concept Era Shift from firm-oriented production to consumer-orientated research/marketing ‘The Marketing Concept’ 1. Finding out what consumers want 2. Satisfy their needs by selling them that Marketing occurs before production, not after

31. Evolution of Market Orientation How Marketing became Important The Era of Customer Relationship Marketing 1-31 LO5  Customer Relationship Era Market Orientation 1. Continuously determine consumer needs 2. Share info across departments 3. Create customer value Customer Relationship Management Developing favourable long-term relationships rather than one-off transactional purchases

32. Evolution of Market Orientation Four eras in the History of American Businesses The Era of Customer Relationship Marketing 1-32 LO5

33. Ethics & Social Responsibility Importance of Marketing The Era of Customer Relationship Marketing 1-33 LO5  Ethics  Social Responsibility Societal Marketing Concept Macromarketing Micromarketing

34. Ethics & Social Responsibility Importance of Marketing The Era of Customer Relationship Marketing 1-34 LO5  Societal Marketing Concept Satisfy consumer needs without compromising society, e.g. recycled bott les  Macromarketing Study of how marketing affects a nation/society, e.g. pollution, advertising  Micromarketing Study of how organisational marketing activities benefits consumers

35. Breadth and Depth of Marketing Who Markets & What is Marketed Marketing and Utility 1-35 LO6  Who Markets?  What Is Marketed? Goods Services Ideas

36. Breadth and Depth of Marketing Who Benefits, and How? Marketing and Utility 1-36 LO6  Who Benefits?  Who Buys & Uses What Is Marketed? Ultimate Consumers Organizational Buyers  How Do Consumers Benefit? Utility  Form Utility  Place Utility  Time Utility  Possession Utility