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Summary Principles of Marketing - Philip Kotler, Gary Armstrong - seventeenth edition
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Summary of Principles of Marketing - Philip Kotler, Gary Armstrong - seventeenth edition
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Marketing Fundamentals Notes
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Content preview
MarketingPages 24-34
Marketing:
- Engaging customers and managing profitable customer relationships
- The process by which companies engage customers, build stronger
relationships and create customers value in order to capture value from
customers.
Chapter preview
The aim of marketing is to create value for costumers in order to capture value from
customers in return.
What Is Marketing?
The twofold goal of marketing
- Attract new customers by promising superior value
- To keep and grow current customers by delivering value and satisfaction
Marketing Defined
If the marketer engages consumers effectively, understand their needs, develops
products that provide superior customer value, and prices, distributes, and promotes
them well, these products will sell easily.
Marketing: The process by which companies engage customers, build stronger
relationships and create customers value in order to capture value from customers.
The Marketing Process
5 step model of the marketing process for creating and capturing customer value
1
,In the first 4 steps, companies work to understand consumers, create customer
value, and build strong customer relationships.
In the final step, companies reap the rewards of creating superior customers value.
By creating value for customers, they in turn capture value from consumers in the
form of sales, profits, and long-term customer equity.
Understanding the Marketplace and Customer Needs
We examine 5 core customer and marketplace concepts;
1. Customer Needs, Wants, and Demands
- Needs: states of felt deprivation.
Marketers did not create these needs; they are a basic part of the
human makeup.
- Wants: the form human needs take as they are shaped by culture and
individual personality.
Wants are shaped by one’s society and are described in terms of
objects that will satisfy those needs.
- Demands: human wants that are backed by buying power.
2. Market Offerings (products, services, and experiences)
- Market offerings: some combination of products, services, information,
or experiences offered to a market to satisfy a need or want.
- Marketing myopia: the mistake of paying more attention to the specific
products a company offers than to the benefits and experiences
produced by these products.
3. Customer Value and Satisfaction
- Customers form expectations about the value and satisfaction that
various market offerings will deliver and buy accordingly.
4. Exchanges and Relationships
2
, - Exchange: the act of obtaining a desired object from someone by
offering something in return.
- Marketing consist of actions taken to create, maintain, and grow
desirable exchange relationships with target audiences involving a
product, service, idea, or other object.
5. Markets
- Market: the set of all actual and potential buyers of a product or
service.
- Marketing means managing markets to bring about profitable
customers relationships.
- Buyers also carry out marketing
-
The company and competitors research the market and interact with
consumers to understand their needs. Then they create and exchange
market offerings, messages, and other marketing content with
consumers, either directly or through marketing intermediaries.
Pages 34-38 and 46-55
Designing a Customer Value – Driven Marketing Strategy and plan
Customer Value – Driven Marketing Strategy
Marketing management: the art and science of choosing target markets and building
profitable relationships with them.
To design a winning marketing strategy, the marketing manager must answer the
following questions;
- What customers will we serve (what’s our target market)?
- The company decides whom they want to serve to. They do this by
dividing the market into segments (market segmentation) and selecting
in which segments it will go after (target marketing).
- The company wants to sell only customers that it can serve well and
profitably.
- Marketing managers must decide which customers they want to target
on the level, timing, and nature of their demand. Simply put, marketing
management is customer management and demand management.
- How can we serve these customers best (what’s our value proposition)?
3
, - The company must decide how it will serve targeted customers – how it
will differentiate and position itself in the marketplace.
- Value proposition: the set of benefits or values it promises to deliver to
consumers to satisfy their needs.
- They answer the customer’s question: ‘Why should I buy your brand
rather than a competitor’s?’
Marketing Management Orientations
Marketing management wants to design strategies that will engage target customers
and build profitable relationships with them.
There are 5 alternative concepts under which organisations design and carry out
their marketing strategies.
- The Production Concept
- Production concept: the idea that consumers will favour products that
are available and highly affordable; therefore, the organization should
focus on improving production and distribution efficiency.
- Product concept can lead to marketing myopia. Companies adopting
this orientation run a major risk of focusing too narrowly on their own
operations and losing sight of the real objective – satisfying customer
needs and building costumer relationships.
- The Product Concept
- Product concept: the idea that consumers will favour products that offer
the most quality, performance, and features; therefore, the organization
should devote its energy to making continuous product improvements.
- Focusing on only the company’s products can also lead to marketing
myopia.
- Buyers may be looking for a better and different solution to a problem,
but not necessarily for a more improved solution.
- The Selling Concept
- Selling concept: the idea that consumers will not buy enough of the
firm’s products unless the firm undertakes a large-scale selling and
promotion effort.
- The selling concept is typically practiced with unsought goods – those
that buyers do not normally think of buying.
- This concept has high risks. It focuses on creating sales transactions
rather than on building long-term, profitable customer relationships.
- The aim is often to sell what the company makes rather than to make
what the market wants.
- The Marketing Concept
- Marketing concept: a philosophy in which achieving organisational
goals depends on knowing the needs and wants of target markets and
delivering the desired satisfactions better than competitors do.
- Customers focus, and value are the paths to sales and profits
- The job is not to find the right customers for your product but to find the
right products for your customers.
- Customer-driven: learn customers deeply to learn about their desire,
gather new product ideas, and test product improvements.
- Customer-driving: understanding customers’ needs even better than
the customers themselves do and creating products and services that
meet both existing and latent needs, now and in the future.
4
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