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Introduction to Marketing

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Learning Objectives:
After this session, you should be able to:

1. Define marketing and outline the steps in the marketing

process

2. Explain the importance of understanding customers and the

marketplace, and identify the five core marketplace concepts

3. Identify the key elements of a customer-driven marketing

strategy and discuss the marketing management orientations
that guide marketing strategy

4. Discuss customer relationship management, and identify

strategies for creating value for customers and capturing value

from customers in return

What Do You Know About….

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What is Marketing?
Marketing defined:

Marketing is a process by
which companies create value
for customers and build strong
customer relationships to capture
value from customers in return.

(By satisfying customers’ needs profitably)

What is Marketing?
Marketing is all around you…

The fruit seller has to:

• Understand her market,
• Distribute her fruits at the right
place
• Sell them at the right price
• Be alert of who else are selling fruits
or possible substitutes.

She has to make sure that she offers

superior customer value.

What is Marketing?

The Marketing Process

A Simple Model of the Marketing Process

In the final step, companies reap the rewards of capturing value from consumers in the
form of sales, profits, and long-term customer equity.

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Core Concepts

Customer Needs, Wants and Demands

• States of deprivation
• Physical—food, clothing, warmth, safety
Needs • Social—belonging and affection
• Individual—knowledge and self-expression

•Form that needs take as they are shaped by

Wants culture and individual personality

Demands •Wants backed by buying power

Maslow’s Hierarchy Of Needs

Core Concepts

Market Offerings—Products, Services, and Experiences

Market offerings are some combination of products,

services, information, or experiences offered to a market
to satisfy a need or want.

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Core Concepts

Customer Value & Satisfaction

Creating the balance between customer expectations and
the marketers ability to deliver on value

Customers
• Value and
satisfaction

Marketers
• Set the right level
of expectations
• Not too high or low

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Core Concepts

Marketing and Exchange

Exchange is the act of

obtaining a desired object
from someone by offering
something in return

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Core Concepts

Market

The set of all actual and

potential buyers of a product
or service

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Core Concepts

Elements of modern marketing system

The different parties who are involved in the marketing

process

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Designing a Customer-Driven Marketing Strategy

Marketing Management

Marketing management
is defined as the art and
science of choosing target
markets and building
profitable relationships
with them.

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Designing a Customer-Driven Marketing Strategy

Marketing Management

Two key questions to determine how to design a winning

marketing strategy:

1.What customers will we serve? (What’s our target market)

2.How can we best serve these customers? (What’s our value
proposition)

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Designing a Customer-Driven Marketing Strategy

Target Market

The company must decide whom

it will serve by:
• Divide the market into
segments of customers
(segmentation)
• Selecting which segments to
serve (targeting)
The Mandarin Oriental Hotel goes
after the affluent professionals and
business market.

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Designing a Customer-Driven Marketing Strategy

Value Proposition

What is a Value Proposition?

17 © 2012 Principles of Marketing: An Asian Perspective

Designing a Customer-Driven Marketing Strategy

Marketing Management Orientations

Over time five alternative concepts have developed under

which organizations design and carry out their marketing
strategies.

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Designing a Customer-Driven Marketing Strategy

Production Concept

Consumers will favor products that are available and

affordable.

Management should focus on improving production and

distribution efficiency.

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Designing a Customer-Driven Marketing Strategy

Product Concept

Consumers will favor products that offer the most in quality,

performance, and innovative features

Organization should therefore devote its energy to making

continuous product improvements.

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Designing a Customer-Driven Marketing Strategy

The problem with the Product Concept

Product quality and improvement are important parts of

most marketing strategies. However, focusing only on
the company’s products can also lead to marketing
myopia.

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What is this company well known

for?

What is their situation now?

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What went wrong?

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Marketing myopia

• The mistake of paying more attention to the specific

products a company offers than to the benefits and
experiences derived from these products.

• Companies must seek to avoid the marketing myopia

trap!

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Designing a Customer-Driven Marketing Strategy

Selling Concept

Consumers will not buy enough products

unless the company undertakes a large
scale selling and promotion effort from the
company

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Designing a Customer-Driven Marketing Strategy

Marketing Concept

• Under the marketing concept, customer 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 marketing is about understanding
customer needs and creating products and services that
meet existing and latent needs.
• And delivering the desired satisfactions better than
competitors do

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Designing a Customer-Driven Marketing Strategy

Marketing Concept

Example of the marketing concept being applied: KFC

adapts its menu to suit Vietnamese tastes.

In terms of website In terms of menu In terms of location

and language
Source: http://www.kfcvietnam.com.vn/

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Designing a Customer-Driven Marketing Strategy

The selling and the marketing concepts contrasted

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Designing a Customer-Driven Marketing Strategy

Societal Marketing Concept

Societal marketing
concept is the idea that a company
should make good marketing
decisions by considering consumers’
wants, the company’s requirements,
consumers’ long-term interests, and
society’s long-run interests.

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Designing a Customer-Driven Marketing Strategy

Three considerations underlying the

societal marketing concept

Companies should
balance three considerations
in setting their marketing
strategies: company profits,
consumer wants, and
society’s interests.

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Clicker question

1. ANZ has announced a donation of US$87,000 to support

communities in Indonesia, Philippines, Vietnam, Cambodia, and Laos
which have been impacted by Typhoon Ketsana. The statement
above illustrates that ANZ applies the__________.

a) Production concept
b) Product concept
c) Selling concept
d) Marketing concept
e) Societal marketing concept

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Clicker question
2. AIG, an international insurance company uses personal selling to
approach its target market. A salesperson could gain up to 50%
commission for selling a 30-year life insurance contract. Customers
who sign the contract also have a chance to win a villa in a lucky
draw. What marketing concept is AIG practicing?

a) Production concept
b) Product concept
c) Selling concept
d) Marketing concept
e) Societal marketing concept

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Building Customer Relationships

Customer Relationship Management (CRM)

• The overall process of building and maintaining profitable

customer relationships by delivering superior customer
value and satisfaction.

• Managing customer “touch points”

in order to maximize customer loyalty.

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Building Customer Relationships

Customer Perceived Value

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Capturing Value from Customers

Creating Customer Loyalty and Retention

• The aim of CRM is to create not just customer satisfaction,

but customer delight.

• Companies are realizing that losing a customer means

losing more than a single sale. It means losing customer
lifetime value.

• Customer lifetime value is the value of the entire

stream of purchases that the customer would make over a
lifetime of patronage.

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Capturing Value from Customers

Share of customer

Share of customer is the portion of the customer’s

purchasing that a company gets in its product categories

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Capturing Value from Customers

Customer Equity

Customer equity is the total combined customer lifetime

values of all of the company’s customers

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Clicker question

3. Ngoc Anh has just bought a Cosmopolitan magazine and read it

for the first time. She found that the magazine has good contents
and many interesting issues beyond her expectation. The magazine
has achieved _________.

a) Societal marketing concept

b) Product development
c) Relationship
d) Brand equity
e) Customer satisfaction

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Clicker question

4. For months Linh has wanted to buy an iPhone6. Now that she has
finally saved enough money from her part-time job she has the
buying power to purchase the phone she has dreamed about. Linh’s
want now has become a ________.

a) Need
b) Necessity
c) Demand
d) Satisfier
e) None of the above

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