Download Chapter 1- Marketing: creating and capturing customer value

 Chapter 1- Marketing: creating and capturing customer value
Define marketing and outline the steps in the marketing process.
 Marketing is the process by which companies create value for customers and build strong customer
relationships in order to capture value from customers in return.
 The steps in the marketing process are:
1) understand the marketplace and customer needs, wants and demands
2) design a customer-driven marketing strategy,
3) conduct an integrated marketing program that delivers superior value,
4) build profitable relationships
5) create customer delight and capture value from customers to create profits and customer equity.
Explain the importance of understanding customers and the marketplace, and identify the five core
marketplace concepts.
 Organisations must fully understand consumers and the marketplace in which it operates because
marketing is all about creating value for customers.
 The five core marketplace concepts are:
1) customer needs,
2) wants and demands;
3) customer value and satisfaction;
4) exchanges, transactions and
5) relationships and markets.
Identify the key elements of a customer driven marketing strategy and discuss the marketing management
orientations that guide marketing strategy.
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The key elements are selecting customers to serve, choosing a value proposition and marketing
management orientations.
The marketing management orientations have 5 concepts:
1) production concept,
2) product concept,
3) selling concept, marketing concept and societal marketing concept.
Discuss customer relationship management and identify strategies for creating value for customers and
capturing value from customers in return.
 Customer relationship management is the overall process of building and maintaining profitable
relationships by delivering superior customer value and satisfaction.
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It involves managing detailed information labour individual customers and carefully managing
customer ‘touch points’ in order to maximise customer loyalty
 The strategies for creating value for customers are:
1) customer value,
2) customer satisfaction,
3) customer relationship levels and
4) tools.
 The strategies for capturing value from customers are:
1) creating customer loyalty and retention,
2) growing share of customer,
3) building customer equity
4) building the right relationship with the right customers.
Describe the main trends and forces that are changing the marketing landscape in the age of relationships.
 Early 2008, US experienced GFC which led to US consumers short of money and confidence as they
faced losses in income.
 In response companies in Aus tightened their budgets and aligning marketing strategies with the new
eco realities.
For measuring marketing’s contribution to organizational performance
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As performance measurement has increasing become the domain of marketing management one key
question facing each type of organisation is which objective and subjective performance measures to
use in assessing performance.
In the past marketing has been most applied in the business sector. In recent years, however, not-forprofit marketing has also become a major component in the strategies.
Information technology of the digital age is making an impact on the marketing industry. It creates
major shifts in markets and competition, leading to introduction of global competitors in various
markets becoming attractive due to lower costs offered to many industries by technology like
internet.
 Chapter 2- Company and Marketing Strategy: Partnering to build
customer relationships
Explain company-wide strategic planning and is four steps.
 Strategic planning is the process of developing and maintaining a strategic fit between the
organisation’s goals and capabilities and its changing market opportunities.
 Strategic planning sets the stage for the rest of the planning in the firm.
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Companies usually prepare annual plans, long-range plans and strategic plans.
 Strategic plan involves adapting the firm to take advantage of opportunities in its constantly changing
environment.
 The four steps are :
1) defining the company mission,
2) setting company objectives and goals,
3) designing the business portfolio
4) planning marketing and other functional strategies.
 A mission statement is a statement of the organisation’s purpose- what it wants to accomplish in the
larger environment.
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The marketing organisation needs to turn its mission into detailed supporting objectives for each
level of management.
 Each manager should have objectives and be responsible for reaching them.
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Business portfolio is the collection of businesses and products that make up the company. A
company’s portfolio should gave both strengths and weakness.
Discuss how to design business portfolios and develop growth strategies.
 Designing and planning involves 2 steps:
1) first is that the company must analyse its current business portfolio and decide which
businesses should receive more, less or no investment.
2) Second it must shape the future portfolio by developing strategies for growth and
downsizing.
 The major activity in strategic planning is business portfolio analysis, which refers to process by which
management evaluates the products and businesses that make up the company.
 Companies need growth if they want to:
a) compete more effectively,
b) satisfy shareholders
c) attract top talent.
 Marketing has the main responsibility for achieving profitable growth for the company.
 One useful device to identify growth opportunities is product/ market expansion grid which helps to
identify growth opportunities through market penetration, market development, product
development or diversification.
Explain marketing’s role in strategic planning and how marketing works with its partners to create and
deliver customer value.
 The company’s strategic plan establishes what kinds of businesses the company will operate and its
objectives for each.
 Marketing plays a key role in the company’s strategic planning in several ways:
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1) First marketing provides a guiding philosophy, the marketing concept which suggests that
company strategy should revolve around building profitable relationships with important
consumer groups.
2) Second marketing provides input to strategic planners by helping to identify attractive
market opportunities and by assessing the firm’s potential to take advantage of them.
3) Finally individual business units, marketing designs strategies for reaching the unit’s
objectives.
Each company department can be thought of as a link in the company’s internal value chain  which
refers to the series of internal departments that carry out value-creating activities to:
a) design,
b) produce,
c) market,
d) deliver and
e) support a firm’s products.
The firm needs to look beyond its own internal value chain and into the value chains of its suppliers,
distributors, and ultimately its customers.
Describe the elements of a customer-driven marketing strategy and mix, and the forces that influence it.
 The elements of a customer-driven marketing strategy are:
1) market segmentations,
2) market targeting,
3) market differentiation and
4) positioning.
Market segmentation  divide the market into distinct
groups of buyers who have different needs characteristics or
behaviour, and who might require separate products or
marketing programs.
Differentiation  is differentiating the market offering to
create value
Market targeting  is the process of evaluating each market segment’s
attractiveness and selecting one or more segments to enter.
Positioning  is arranging or a product to occupy a clear, distinctive and
desirable place relate to competing products in the minds of target
consumers. The marketing mix is a set of controllable tactical marketing
tools- product, place, promotion, people, process and physical evidencethat the firm blends to produce the response it wants in the target market.