LEARNING OBJECTIVES (LO)

After reading Chapter 1, you should be able to :

Define marketing and identify the requirements for

LO1 marketing to occur.

LO2 Explain how marketing discovers and satisfies

consumer needs.

Distinguish between marketing mix elements and

LO3 environmental forces.

1-2

Introduction – Creating Customer Relationships & Value through Marketing

LEARNING OBJECTIVES (LO)
After reading Chapter 1, you should be able to :

LO4 Explain how organizations build strong customer

relationships and customer value through marketing.

Describe how today’s customer relationship era

LO5 differs from prior eras oriented to production and
selling.

LO6 Explain how marketing creates utilities for consumers.

1-3

Introduction – Creating Customer Relationships & Value through Marketing

 UNIQLO
Unique Clothes, Unique Shopping Experience

1-4

Opening Story – Uniqlo

Discovering Consumer’s Needs
What do customers expect from clothes?

1-5

Opening Story – Uniqlo

 What is Marketing?
Definitions and Examples

 You are already a Marketing Expert

 Marketing Is NOT Easy

1-6
LO1
Defining Marketing
 What is Marketing?
Marketing is about Delivering Benefits

 Uniqlo, Marketing and You

 Marketing: Using Exchanges to Satisfy

Needs

 The Diverse Factors Influencing

Marketing Activities

1-7
LO1
Defining Marketing
 What is Marketing?
Diverse Factors influence Marketing Activities

 Organization

 Society

 Environmental Forces

1-8
LO1
Defining Marketing
 What is Marketing?
How Marketing relates to people, groups and forces

1-9
LO1
Defining Marketing
 What is Marketing?
Requirements for ‘Marketing’

 Parties with Unsatisfied Needs

 A Desire and Ability to be Satisfied

 A Way for the Parties to Communicate

 Something to Exchange

1-10
LO1
Defining Marketing
 Discovering Consumer Needs
How Marketing discovers Consumer Needs

 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

1-11
LO2 Consumer Needs
 New Product Challenges
How Marketing discovers Consumer Needs

 Most New Products Fail

 The Challenge of New Products is to

 Learn from the Past

 Offer Consumers a New benefit

1-12
LO2 Consumer Needs
 Benefits & Show-Stoppers
Dr. Care Vanilla Mint Aerosol Toothpaste

1-13
LO2 Consumer Needs
 Benefits &Show-Stoppers
Hot Pockets Bite-Sized Microwavable Snack Sensations

1-14
LO2 Consumer Needs
 Benefits & Show-Stoppers
A Flying Car!

1-15
LO2 Consumer Needs
 Benefits & Show-Stoppers
Diet Cola with Ginseng & Extra Caffeine

1-16
LO2 Consumer Needs
 Needs vs Wants
An important distinction

 Need

 Want

 Does Marketing persuade people to buy the “Wrong” Things?

 Can Marketers create Needs?

1-17
LO2 Consumer Needs
 What is a Market?
Who is a ‘consumer’?

Potential
consumers

Potential
consumers
Whole population

Potential consumers = People with both the desire

& ability to buy a specific product
1-18
LO2 Consumer Needs
 Discovering Consumer Needs
The first task is to discover consumer needs

1-19
LO2 Consumer Needs
 The Marketing Mix : 4 P’s
Controllable Market Factors

 Target Market : 1 or more specific potential consumer groups

 The 4 P’s: Controllable Marketing Mix

Factors

• Product • Promotion

• Price $399 • Place

1-20
LO3 Marketing Mix
 Environmental Forces
Uncontrollable Market Factors

 Uncontrollable Environmental Forces (More to be discussed in Chapter 3)

• Social
• Economic
• Technological
• Competitive
• Regulatory

1-21
LO3 Marketing Mix
 Customer Relationships
What is Value?

Sheng Siong: Low-priced, Market Place: Premium-

self-service, no-frills Priced, full-service with a
concept wide range of international
brand
1-22
LO4 Customer Relationships
 Relationship Marketing
As a Marketing Program

 Global Competition, Customer Value

and Customer Relationships

 Relationship Marketing

• Easy to Understand
• Difficult to implement
• Building relationships with consumers
 Marketing Program – integrating marketing mix
to provide a good, services or idea
1-23
LO4 Customer Relationships
 Creating Value
The second task is to satisfy consumer needs

1-24
LO4 Customer Relationships
 UNIQLO’s Marketing Program
Satisfying Consumer Needs

 Knowing Customers and Understanding

their Needs and Wants

 Developing Core Strategy and Concept

 Assembling Right Mix of Product or

Service, Price, Promotion and Place

1-25
LO4 Customer Relationships
 UNIQLO’s Marketing Program
3 Distinct Shopper Segments

1-26
LO4 Customer Relationships
 Different Segments, Different Needs
Distinct Products for Distinct

●Casual ●Fashionistas

1-27
LO4 Customer Relationships
 Evolution of Market Orientation
How Marketing became Important

 Production Era
 Sales Era
 Marketing Concept Era
 Customer Relationship Era
• Market Orientation
• Customer Relationship Management (CRM)

1-28
LO5 The Era of Customer Relationship Marketing
 Evolution of Market Orientation
How Marketing became Important

 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
1-29
LO5 The Era of Customer Relationship Marketing
 Evolution of Market Orientation
How Marketing became Important

 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

1-30
LO5 The Era of Customer Relationship Marketing
 Evolution of Market Orientation
How Marketing became Important

 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

1-31
LO5 The Era of Customer Relationship Marketing
 Evolution of Market Orientation
Four eras in the History of American Businesses

1-32
LO5 The Era of Customer Relationship Marketing
 Ethics & Social Responsibility
Importance of Marketing

 Ethics

 Social Responsibility

• Societal Marketing Concept

• Macromarketing

• Micromarketing

1-33
LO5 The Era of Customer Relationship Marketing
 Ethics & Social Responsibility
Importance of Marketing

 Societal Marketing Concept

• Satisfy consumer needs with compromising society,
e.g. recycled bottles

 Macromarketing
• Study of how marketing affects a nation/society, e.g.
pollution, advertising

 Micromarketing
• Study of how organisational marketing activities
benefits consumers
1-34
LO5 The Era of Customer Relationship Marketing
 Breadth and Depth of Marketing
Who Markets & What is Marketed

 Who Markets?

 What Is Marketed?

• Goods • Services • Ideas

1-35
LO6 Marketing and Utility
 Breadth and Depth of Marketing
Who Benefits, and How?

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