Chapter 1: Customer-Driven Strategic Marketing

1. Chapter 1:Customer-Driven Strategic Marketing Pride/Ferrell Foundations of Marketing Fourth Edition Prepared by Milton Pressley University of New Orleans

2. Objectives Define marketing Understand several important marketing terms including target market, marketing mix, marketing exchanges, and marketing environment Be aware of the marketing concept and marketing orientation Understand the importance of building customer relationships Explain the major marketing functions that are a part of the marketing management process Understand the role of marketing in our society

3. Marketing Defined • Marketing is the process of creating, distributing, promoting, and pricing goods, services, and ideas, to facilitate satisfying exchange relationships with customers and develop and maintain favorable relationships with stakeholders in a dynamic environment.

4. Fig. 1.1 Components of Strategic Marketing

5. Who is the Focus of Marketing? • CustomersThe purchasers of organizations’ products; the focal point of all marketing activities. • The Target Market • Old Navy focuses on its target market to meet their needs • Who is their target market?

6. Target Market Target Market-is a specific group of customers on whom an organization focuses its marketing efforts. Appealing to health-conscious customers

7. The Marketing Mix Variables Marketers combine and balance four elements when determining how to satisfy customers’ needs for a product: • Product • Price • Distribution • Promotion

8. Product Variable A product can be a: • Good • Service • Idea Product Petzl’s ad focuses on the quality, comfort, and reliability of its climbing helmet

9. Price Variable • Relates to decisions and actions associated with establishing pricing objectives and policies • Relates to determining product prices • Determines the value of the exchange Price The Mini Cooper is promoted as being both affordable to buy and economical on fuel

10. Distribution Variable • Make products available in quantities desired • Minimize costs: • Inventory • Transportation • Storage • Select/motivate intermediaries • Establish/maintain inventory control • Develop/manage transportation andstorage systems

11. Promotion Variable • Inform individuals or groups about the organization and its products/services • Advertising • Public relations • Personal selling • Promotions • Street teams • Viral marketing

12. Relationships with Customers Exchange - the provision or transfer of goods, services, or ideas in return for something of value

13. Stakeholders Constituents who have a “stake,” or claim, in some aspect of a company’s products, operations, markets, industry, and outcomes. The Customer as a Stakeholder Yoplait donates to breast cancer research.

14. Marketing Environment The six types of forces that surround the customer and affect the marketing mix: Economic forces Political forces Legal and regulatory forces Technological forces Socio-cultural forces Competitive forces Unlike marketing-mix variables, an organization has no control over these forces

15. Discussion Question Pick a product that you want to market. Discuss how each of the forces in the marketingenvironment willeffect your marketing mix.

16. The Marketing Concept A managerial philosophy that an organization should try to provide products that satisfy customers’ needs through a coordinated set of activities that also allows the organization to achieve its goals. The Marketing Concept SSI understands the importance of a customer orientation by listening to customers and providing great service

17. The Evolution of the Marketing Concept The marketing concept has changed over time:

18. Marketing Orientation An organization-wide commitment to researching and responding to customer needs.

19. Implementing the Marketing Concept • First, establish an information system to discover customers’ real needs • Use the information to create satisfying products • Coordinate all activities

20. Managing Customer Relationships Relationship Marketing Establishing long term mutually satisfying, buyer/seller relationships.

21. Customer Relationship Marketing (CRM) • Using information about customers to create marketing strategies that develop and sustain desirable customer relationships.

22. Value-Driven Marketing Value-a customer’s subjective assessment of benefits relative to costs in determining the worth of a product. Value Customer Benefits Customer Costs = –

23. Marketing Management The process of planning, organizing, implementing, and controlling marketing activities to facilitate exchanges effectively and efficiently.

24. Why Marketing Plays An Important Role in Our Global Economy

25. After Reviewing This Chapter You Should: Be able to define marketing Understand several important marketing terms including target market, marketing mix, marketing exchanges, and marketing environment Be aware of the marketing concept and marketing orientation Understand the importance of building customer relationships Explain the major marketing functions that are a part of the marketing management process Understand the role of marketing in our society

26. Key Concepts Marketing Customers Target market Marketing mix Products Exchanges Stakeholders Marketing environment • Marketing concept • Marketing orientation • Relationship marketing • Customer relationship management (CRM) • Value • Marketing management