Summary of Marketing book: Marketing 'An Introduction' Thirteenth edition - Gary Armstrong, Philip Kotler with Marc O. Opresnik. Chapter 1,2,3,6,7,8,9,10,12,14 - International Business Studies
Chapter 1 – Marketing, Creating Customer Value and Engagement
What is marketing?
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.
The goal: to attract new customers by promising superior value and to keep grow current
customers by delivering satisfaction
The five step marketing process:
Traditional marketing
- Making a sale
- Abundance of products in the nearby shopping centres
- Television, magazine, and direct-mail ads
Contemporary marketing
- Satisfying customer needs
- Imaginative websites, mobile phone apps, blogs, online videos and social media
- Reach customers directly, personally and interactively
Marketing creates value for customers
• understand marketplace and customers
• design a customer value-driven marketing strategy
• construct a marketing program
• engage customers, build relationships
• Captures value from customers
Five core customer and marketplace concepts:
• Needs, wants, and demands
• Market offerings
• Value and satisfaction
• Exchanges and relationships
• Markets
1. Needs
• States of felt deprivation
• Physical needs -Food, clothing, warmth, and safety
• Social needs -Belonging and affection
• Individual needs -Knowledge and self-expression
1. Wants
• Form taken by human needs when shaped by culture and individual personality
, 1. Demands
• Human wants that are backed by buying power
2. Marketing offerings
• Products, services, information or experiences -> Offered to satisfy a need or want
Marketing myopia = paying more attention to the specific products than to the benefits and
experiences produced
3. Customer value and satisfaction
• Customers form expectations about the value and satisfaction of market offerings.
• Satisfied customers buy again
• Dissatisfied customers switch to competitors
Setting the right level of expectations
• Low expectations may fail to attract buyers
• High expectations may disappoint buyers
4. Exchange and relationships
Exchange is the act of obtaining a desired object by offering something in return.
• Marketing consists of creating, maintaining, and growing desirable exchange relationships.
• Strong relationships are built by consistently delivering superior customer value.
5. Markets
• All actual and potential buyers of a product
• Sellers and Consumers market
• Customer-managed relationships
See page 36 of the book
,Designing a Customer Value-Driven Marketing Strategy
• Marketing management: Choosing target markets and building profitable relationships
How to design a winning marketing strategy?
• Target market -> who will you sell to? Using market segmentation and target marketing
• Value proposition -> the set of benefits or values it promises to deliver to consumers to
satisfy their needs
Market segmentation
Refers to dividing the market into segments of customers
Target marketing
Refers to which segments to go after
Choosing a value proposition
The company must decide how it will differentiate and position itself in the marketplace. A
brand’s value proposition is the set of benefits or values it promises to deliver to consumer to
satisfy their needs.
Example: Spirit Airlines: ‘’ Less Money, More Go.’’
There are five alternative concepts under which organizations design and carry out their
marketing strategies, those are called marketing management orientations:
1. The production concept
Focusing on improving production and distribution efficiency. The idea that consumers will
favor products that are available and highly affordable.
2. The product concept
Devoting the company’s energy to make continuous product improvements. The idea that
consumers will favour products that offer the most quality, performance and features.
3. The selling concept
The idea that the consumers will not buy enough of the firm’s products unless the firm
undertakes a large-scale selling and promotion effort.
4. The marketing concept
A philosophy in which achieving organizational goals depends on knowing the needs and
wants of target markets and delivering the desired satisfaction better than the competitors
do.
5. The societal marketing concept
The idea that a company’s marketing decisions should consider consumers’ wants, the
company’s requirements, consumers’ long-run interests, and society’s long-run interests.
, Marketing Mix
The 4 P’S:
Product
Price
Place
Promotion
Marketing mix tools should be blended into a comprehensive integrated marketing program.
Customer Relationship Management
Delivering superior customer value and satisfaction to build and maintain profitable customer
relationships
Customer-perceived value: Customer’s evaluation of a marketing offer relative to those of
competing offers
Customer satisfaction: Extent to which a product’s perceived performance matches a
buyer’s expectations
Tools
• Frequency marketing programs
• Loyalty rewards programs
• Club marketing programs
Customer-Engagement Marketing
• Customer-engagement marketing makes the brand a meaningful part of consumers’
conversations and lives.
• Greater consumer empowerment means that companies must practice marketing by
attraction.
• Marketers must find ways to enter consumers’ conversations with engaging and relevant
brand messages.
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