Summary
Marketing Summary
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Summary of the course marketing taught at the VUB for students of Business Economics
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summary Principles of Marketing
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Summary Year 2 Block 1 - Principles of Marketing (Pearson), Global Edition, 17th edition, ISBN: 9781292220284 Marketing & Sales
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PRINCIPLES OF MARKETING SUMMARY
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“MARKETINGCHAPTER 1 : MAKRETING : CREATING CUSTOMER VALUE AND – ENGAGEMNT:
In Ch. 1, we learn:
1. To define marketing and understand steps in the marketing process
2. To understand the importance of understanding the marketplace and customer
needs
3. To identify key elements of a customer-value driven marketing strategy
4. To discuss customer relationship management and what it entails for both customers
as well as organizations
5. 5. To be aware of major trends in the marketing landscape
Agenda:
1. What is marketing?
2. The marketplace and customer needs
3. A customer value-driven marketing strategy
4. An integrated marketing plan
5. Engaging customer and managing customer relationships
6. Capturing value from customers
7. The changing marketing landscape
WHAT IS MARKETING ?
Marketing, more than any other business function, deals with customers. The simplest
definition is this one: Marketing is the process by which companies engage customers, build
strong customer relationships, and create customer value in order to capture value from
customers in return.
Another definition: Marketing is... ‘the management process of anticipating, identifying and
satisfying customer requirements profitably’ (The Chartered Institute of Marketing, 2001)
1. Value creation and value appropriation
Consumers usually face a broad array of products and services that might satisfy a given
need. How do they choose among these many market offerings? Customers form
expectations about the value and satisfaction that various market offerings will deliver
and buy accordingly. Satisfied customers buy again and tell others about their good
experiences. Dissatisfied customers often switch to competitors and disparage the
product to others.
Marketers must be careful to set the right level of expectations. If they set expectations
too low, they may satisfy those who buy but fail to attract enough buyers. If they set
expectations too high, buyers will be disappointed. Customer value and customer
satisfaction are key building blocks for developing and managing customer relationships.
1
, 2. Existing and new customers
Attracting new customers and retaining customers can be a difficult task. Customers
often face a bewildering array of products and services from which to choose. A
customer buys from the firm that offers the highest customer-perceived value – the
customer’s evaluation of the difference between all the benefits and all the costs of a
market offering relative to those of competing offers. Customers often don’t judge
values and costs “accurately”, “objectively”. They act on a perceived value.
- Companies that use strategic marketing planning, perform better financially. (
empirical research has shown this)
Marketing = Sales ?
Marketing Sales
Focus on long-term satisfying of customer Focus on short-term satisfying of customer
needs needs
Based to a larger extent on customer
Based to only a limited extent on customer input
input in designing the offering (co-
in designing the offering
creation)
Rather than focusing on stimulating demand, it
Puts the focus on stimulating demand tends to focus more on satisfying existing
demand
- It’s not just selling but satisfying customer’s needs
- The aim of marketing is to know and understand the customer so well the product or
service fits him and sells himself ( Peter Drucker)
- Customers are important!!!
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Selling concept = consumers will not buy enough of the firm’s products unless it
undertakes a large-scale selling and promotion effort. Selling concept practiced with
unsought goods (those that buyers don’t normally think of buying, such as life insurance
or blood donations). These industries must be good at tracking down prospects and
selling them on a product’s benefits. Aim => to sell what the company makes and not
what the market wants. Assumption => people who don’t buy it now, will buy it later.
2
, Marketing concept= holds that achieving organizational goals depends on knowing
the needs and wants of target markets and delivering the desired satisfaction better
than competitors do. Customer focus and value are the paths to sales and profits.
= customer-centered sense-and-respond philosophy; the job isn’t to find the right
customers for your product but to find the right products for your customers
Customer-driving marketing= understanding customer needs even better than
customers themselves do and creating products and services that meet both existing
and latent needs, now and in the future. ( Henry ford: If I had asked people what they
wanted, they would have said faster horses)
Inside-out view vs outside-in view:
Inside- out = selling what company makes rather than making what customer wants. (selling)
Outside-in = satisfying customer needs as a path to profits (marketing)
Marketing.. nothing more than advertising?
- After determining its overall marketing strategy => company begin planning the
details of the marketing mix.
- Marketing mix= set of tactical marketing tools that the firm blends to produce the
response it wants in the target market. It consists everything a firm can do to engage
consumers and deliver customer value
- Many possibilities= the four Ps
Product= the goods- and-services combination the company offers to the target
market
Price= the amount of money customers must pay to obtain the product
Place= includes company activities that make the product available to target
consumers
Promotion= refers to activities that communicate the merits of the product and
persuade target customers to buy it
- Four Ps take the seller’s view and not the buyer’s view
The changing economic environment
Marketing isn’t redundant during an economic crisis
- Crisis => consumers must bring their consumption back in line with their incomes and
rethink their buying strategies
- Today: consumer incomes and spending => on the rise
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, - But, they continue to buy less..
- Many consumers are reconsidering their very definition of the good life
- Many companies from discounters to luxury brands, have realigned their marketing
strategies with the new economic realities
- They are focusing on value for the money, practicality and durability in their product
offerings and marketing pitches
- In adjusting to the new economy, companies may be tempted to cut their marketing
budgets and slash prices in an effort to persuade customers into opening their wallets
- Marketing cuts in the wrong place can damage long-term brand image and customer
relationships
- Challenge is to balance the brand’s value proposition with the current times while also
enhancing its long-term equity
- Thus : many marketers hold the line on prices and instead explain why their brands are
worth it
And for non-profit organizations?
- Such as colleges, hospitals, museums, zoos…
- The nation’s not-for-profits face stiff competition for support and membership.
- Sound marketing can help them to attract membership, funds and support
- Government agencies have also shown an increase interest in marketing
Marketing is readily used by local governments, churches, museums, charities,
universities, political parties, zoos, and public hospitals
(all of which operate without profit as central goal)
• Not just for ‘profit’ as central goal
• E.g., generating awareness, acquiring volunteers, inform the people, lobby for legal
amendments, increasing geographical impact, ...
Marketing as ‘exchange’ a two way dyadic process
- Marketing occurs when people decide to satisfy their needs and wants through
exchange relationships
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