The Simple Model of Marketing Process
This important figure shows marketing in a nutshell. By
creating value for customers, marketers capture value from
customers in return. This five-step process forms the
marketing frame work for the rest of the chapter and the
remainder of the text.
Construct an Build profitable Capture value
Understand the Design integrated relationships from
marketplace and customer-driven marketing and create customers to
customer needs marketing program that customer create profits
and wants strategy delivers delight and customer
superior value equity
Create value for customers and Capture value from
build customer relationships customers in return
1. Understanding the Marketplace and Customer Needs
Five Core Marketplace concepts
a) Customer Needs, Wants, and Demands
Needs States of felt deprivation
• Physical—food, clothing, warmth, safety
• Social—belonging and affection
• Individual—knowledge and self-expression
Wants
• Form that needs take as they are shaped by culture and
individual personality
Demands
• Human wants backed by buying power 。
b) Market Offerings-Products, Services, and
Information's and Experiences
Market offerings are some combination of
products, services, information, or experiences
offered to a market to satisfy a need or a want.
Marketing myopia is focusing only on existing
wants and losing sight of underlying consumer
needs.
c) Customer Value, Satisfaction and Expectations
Customers
• From expectations about the value and satisfaction that
various market offerings
• Will deliver and buy accordingly.
Marketers
• Set the right level of expectations
• Not too high or low
d) Exchanges and Relationships
Exchange
• The act of obtaining a desired
object from someone by
offering something in return
Relationship
• Marketing actions try to create, maintain, grow
exchange relationships.
e) Markets
Markets are the set of actual and potential
buyers of a product.
2. Designing a Customer-Driven Marketing Strategy
We define marketing management is the art and
science of choosing target markets and building
profitable relationships with them.
Two important questions:
What customers will we serve
(what’s our target market)?
How can we serve these
customers best (what’s our
value proposition)?
Selecting Customers to Serve
Market segmentation refers to dividing the
markets into segments of customers.
Target marketing refers to which segments to go
after.
Choosing a Value Proposition
A brand’s value proposition is the set of benefits
or values it promises to deliver to consumers to
satisfy their needs.
Marketing Management Philosophies/ Orientations
Difference between selling concept and marketing concept
• The selling concept takes an inside-out view that focuses on existing
products and heavy selling. The aim is to sell what the company makes
rather than making what the customer wants.
• The marketing concept takes an outside-in view that focuses on
satisfying customer needs as a path to profits. As South-west Airlines’
colorful founder puts it, “We don’t have a marketing department, we
have a customer department.”
3. Preparing an Integrated Marketing Plan and
Program
The marketing mix is the set of tools (four Ps) the
firm uses to implement its marketing strategy. It
includes product, price, promotion, and place.
ct tio n
Produ Promo
Price
The firm must blend each marketing mix tool
into a comprehensive integrated marketing
program that communicates and delivers the
intended value to chosen customers.
P l ac e
4. Building Customer Relationships
Customer Relationship Management (CRM)
In this broader sense, customer relationship
management is the overall process of building
and maintaining profitable customer relationships
by delivering superior customer value and
satisfaction.
5. Capturing Value from
Customers
The final step involves capturing value in return
in the form of sales, market share, and profits. By
creating superior customer value, the firm creates
highly satisfied customers who stay loyal and
buy more. This, in return, means greater long-run
returns for the firm.
Creating Customer Loyalty and Retention
Customer lifetime value is the value of the
entire stream of purchases that the customer
would make over a lifetime of patronage
So, What Is Marketing? Pulling It All
Together
