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BUAD 307—MARKETING FUNDAMENTALS

BUAD 307—MARKETING FUNDAMENTALS. MARKETING OVERVIEW . Learning Objectives. Understanding The scope and basic objectives of the marketing function Customer value Relationship marketing. 2007 American Marketing Association (AMA) Definition.

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BUAD 307—MARKETING FUNDAMENTALS

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  1. BUAD 307—MARKETING FUNDAMENTALS MARKETING OVERVIEW

  2. Learning Objectives • Understanding • The scope and basic objectives of the marketing function • Customer value • Relationship marketing

  3. 2007American Marketing Association (AMA) Definition Marketing: “The (1) activity, (2) set of institutions, and (3) processes for (4) creating, (5) capturing, (6) communicating, (7) delivering, (8) and exchanging (9) offerings that have (10) value for (11) customers, (12) clients, (13) partners, and (14) society at large.” (Numbering added.) Definition not needed for the exam!

  4. ACTIVITY INSTITUTIONS PROCESSES MARKETING CREATION COMMUNICATION DELIVERY EXCHANGE CUSTOMERS OFFERINGS VALUE CLIENTS PARTNERS SOCIETY

  5. Marketing As an Exchange • Each side receives something more valuable than what it gave up  “win-win” deal • Part of the value may be assurance of continued quality over time (value of the brand)

  6. Who markets? Businesses Government units Non-profit organizations Cause related organizations What is marketed? Goods Services Ideas Who buys? Ultimate consumers Organizational buyers For internal use For resale (wholesalers, retailers) Manufacturers (components) Customer benefits? Utility Consumption Convenience Usage and Reach of Marketing

  7. Value • Benefits—examples • Convenience • In delivery • In usage • Reliability • Durability • Performance • Style/aesthetics • Prestige • Service component • Costs—examples • Money • Time • Risk

  8. Customer Value, Part I • Value is the ratio of the benefits received (usually goods or services) to what is given up (usually money) • For a transaction to take place, the benefits received must usually be greater than the sacrifice • Note that a high price product may be a good value to the customer even if a high price is paid if the perceived benefits received are higher

  9. Customer Value, Part II • A low priced product may not represent value to a customer if the benefits received are perceived to be low, too. • Different customer segments will have different value perceptions • A product which is adapted to the needs of a particular segment can be very valuable to that segment even if the overall “quality” is not seen as superior by most other consumers • Cost may be in terms of money or other sacrifice

  10. Example of Customer Value: Tivo

  11. Customer Value: Ziploc Bags

  12. Customer Value: iPad

  13. Customer Value: Shellac

  14. Customer Value: Soda Vending

  15. Customer Value: Starbucks

  16. Value: Implications • A low quality, low price product represents poor value for many customers • A very high benefit product at a high price can represent value for some segments • Customer segments differ in what they find valuable

  17. Relationship Marketing • Selling (selling existing products with whatever methods are necessary) vs. marketing orientation (serving customer needs whether in current or new forms) • Maintaining a relationship with the customer over time rather than just focusing on immediate sales • Anticipating customer needs • Providing solutions • Investing in products and services optimized for the customer

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