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All rights reserved

Case Study

! Listen to the podcast. Answer the questions.

Last class

! Introductions
! Guidelines

This class

! Housekeeping
! Communication
! Emails
! Case Studies

 5
Communication: RESPECT

! Treating others with dignity and respect is necessary

for success in this course, in professions, and in life. I
pay close attention to the way you communicate.
Please know that this is extremely important for you
and our class.
! Problem-solving: If you have any questions, concerns,
or thoughts you would like to share, please
communicate this with me directly during a
scheduled conference and we will find a solution.



 6
Communication: CIVILITY

! This class will tolerate neither disruptive language nor

disruptive behavior. Disruptive language includes,
but is not limited to, violent, belligerent, and/or
insulting remarks, including sexist, racist, homophobic
or anti-ethnic slurs, bigotry, and disparaging
commentary, either spoken or written (offensive
slang is included in this category). While each of you
have a right to your own opinions, inflammatory
language founded in ignorance or hate is
unacceptable and will be dealt with immediately.
 7
Communication: CIVILITY

! Disruptive behavior includes the use of cellphones or

any other form of electronic communication during
the class session (email, web-browsing). Disruptive
behavior also includes whispering or talking when
another member of the class is speaking or engaged
in relevant conversation (remember that I am a
member of this class as well). This classroom functions
on the premise of respect.
 8
Attendance and Emails
! Some notes:
! If you are absent, and your absence is not excused via YU guidelines, you will
receive zero for all activities during that class

! Final projects – email me if you have group members in mind (4-5 members
per group). You don’t need a full group, I’ll try to accommodate everyone.
! Email subject: MAR 1001: Group
! Received a response? Please acknowledge it.
! Craft emails using business etiquette (appropriate Greetings etc.)

Case Study

! Listen to the podcast. Answer the questions.

! Disclaimers: Language (theirs), Language (ours)
! Be prepared to discuss next class.
! Hand in a hard copy beginning of next class. !

 Creating and Capturing Customer Value

Topic Outline

1. What is marketing?

1.1 Definition
1.2 Understanding Customer Needs
1.3 The Concept of Exchange
2. Designing a Customer-Driven Marketing Strategy
3. Preparing an Integrated Marketing Program
4. Building Customer Relationships
5. Capturing Value from Customers
6. The Changing Marketing Landscape

What Is Marketing?
 Reflection

How is marketing different from sales?

How is it different from advertising?

(be prepared to discuss your answer)

 1.1 What Is Marketing?

Marketing is a process by which companies create

value for customers and build strong customer
relationships in order to capture value from
customers in return.
Marketing is all around you, in good old traditional forms and
in a host of new forms, from websites and mobile apps to
online videos and social media.

Build customer
Create value Capture value
relationships

Copyright ©2014 by Pearson Education, Inc. All rights reserved

Marketing Process
 1.1 What Is Marketing?
Requirements for Marketing to Occur

1. Two+ parties with

unsatisfied needs
2. A desire and ability to be
satisfied
3. A way for the parties to
communicate
4. Something to exchange Domino’s Pizza

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 Reflection

Do marketers create needs?

 FIGURE 1-2 Marketing seeks to discover consumer needs

through research and then satisfy them with a marketing
program.

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Access the text alternative for these images.
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1.2 Marketing Failures: The importance

of Discovering Consumers’ Needs
 • Consumer A: “It smelled a bit like feet to me. Perhaps Shrek’s
feet.”

• Consumer B: “My husband bit into one the other day, not
realizing that it was a Shrek promotion. He just saw the green
and freaked out and spit it out. He thought it was rotten.”

Discovering consumers’ needs is essential in

marketing. How can we get to know them?

1.2 Discovering Consumers’ Needs

• Discovering consumers’ needs is essential in marketing, but it is not easy to do.

Discovering needs involves looking carefully at current and prospective customers.

What went wrong?

– First, they asked people what was the deciding factor

on a list of attributes, and consumers explicitly said it
was taste.
• They did not realize the importance of consumers’
emotional attachment to the original product,
including its taste
– Second, no one told consumers that only one product
would be marketed
– Did they learn??

21

 Recent Marketing Failures

Please, take notes on the products/brands and the

types of mistakes they did
Example 1

Example 2.1 2.2

What could they have done differently?

 1.3 The Concept of Exchange

Exchange is the act of obtaining a desired object

from someone by offering
something in return

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 Exchange
Food
McDonalds Money
Consumer

Education/Social interaction
YU Students
Tuition

Hope/Promised action
Politicians Voters
Votes

Info and help on drug abuse

Antidrug
Drug User
Group Decreasing the use of drugs

Office Supplies
3M IBM
Money

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 The Concept of Exchange

Marketing actions try to create, maintain,

grow exchange relationships.

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 What do you expect from a brand like Starbucks?

How does Starbucks create value?
How does Starbucks maintain value?
How does Starbucks grow exchange relationships?

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 2 Understanding Consumer Needs


2.1 Customer Needs, Wants, and

Demands

 2 Customer Needs, Wants, and Demands

• States of deprivation

Needs •• Physical—food,
Physical—food, clothing,
clothing, warmth,
warmth, safety
• Social—belonging and affection
•• Individual—knowledge
Individual—knowledge and
safety

and self-expression
self-expression

Wants •• Form
Form that
that needs
needs take
take as
as they
they are
and individual personality
are shaped
shaped by
by culture
culture

Demands •• Wants
Wants backed
backed by
by buying
buying power
power

Copyright ©2014 by Pearson Education, Inc. All rights reserved

Marketing Process
 2 Designing a Customer-Driven
Marketing Strategy
Selecting Customers to Serve

Marketing management is the art and science of choosing

target markets and building profitable relationships with them

Market segmentation refers to dividing the

markets into segments of customers
Target marketing refers
to which segments to go
after

Copyright ©2014 by Pearson Education, Inc. All rights reserved

TED Talk

How did Howard Moskowitz create

value for consumers?

Can you describe the experiment

designed to identify consumers’
wants?

Do you think that

more choice
alternatives makes
happier
consumers?
 But Isn’t More Better?
% of People Purchasing Jam
Jam Choice Study
30%
30%

20%

10%
Findings: Although people
liked having more options, 3%
they bought much less 0%
when there were more 6 Flavors 24 Flavors
options # of Jam Options
Marketing Process
 3 Preparing an Integrated
Marketing Plan and Program

The marketing mix: set of tools (four Ps) the firm uses to implement
its marketing strategy. It includes product, price, promotion, and
place.
Implementation of the 4Ps: comprehensive plan that
communicates and delivers the intended value to chosen
customers.

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 Product: Creating Value

Goods

Services

Ideas
 Capturing Value: Price
time

• Price is everything the

money buyer gives up in exchange energy
for the product.
 Delivering Value: Place

• All activities
necessary to get the
product to the right
customer when that
customer wants it.
Communicating Value: Promotion
• Communication
activities

•Inform, persuade and

remind potential/actual
buyers

•Influence their
opinions or elicit a
response

Communicating Value: Promotion

 Customer Value Proposition

the cluster of benefits that an

organization promises customers to
satisfy their needs.

This is what an effective marketing mix

does.

 Preparing an Integrated
Marketing Plan and Program

Uncontrollable, environmental forces

•Social
•Competitive
•Economic
•Regulatory
•Technological

Marketing Process
 4 Building Customer Relationships

Customer Relationship Management (CRM)

The overall process of

building and maintaining
profitable customer
relationships by delivering
superior customer value
and satisfaction

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Building Customer Relationships
Relationship Building Blocks:
Customer Value and Satisfaction

Customer- Customer
perceived value satisfaction

• The difference • The extent to

between total which a
customer value product’s What types of
and total perceived
customer cost performance
costs could
matches a influence
buyer’s perceived
expectations value?
Copyright ©2014 by Pearson Education, Inc. All rights reserved

 Customer perceived value

5 – 10 days ice retention

Customer perceived value

Is it worth it?
 Customer Satisfaction - The
disconfirmation paradigm

Customers
• Value and
satisfaction

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

Copyright ©2014 by Pearson Education, Inc. All rights reserved

Customer Satisfaction - The

disconfirmation paradigm
 Satisfaction is the key!
• Food allergies • Extra body gel
• Bed size • Blinds open on arrival
• Anti-allergic pillow • Decaf in your room, etc.

 Satisfaction is the key!

• 95% of customers describe stay as truly memorable
• 90% of delighted customers return

 Key to customer
satisfaction:

Meet expectations by
keeping what you
promise

 Building Customer Relationships

The Changing Nature of Customer Relationships

Customer-generated marketing
Customers, empowered by today’s new digital technologies, interact
with companies and each other to shape their relationships with
brands.

Copyright ©2014 by Pearson Education, Inc. All rights reserved

Building Customer Relationships

The Changing Nature of Customer Relationships

•New ways of building relationships

• Blogs
• Websites
• Online communities
• Social networks
• Apps
• Twitter

GIVE ME SOME EXAMPLES!

Marketing Process
5 Capturing Value from Customers

How do we capture value from customers?

What metrics indicate whether or not a

company is doing well?

Capturing Value from Customers

Growing Share of Customer

Share of customer is the portion of the customer’s purchasing

that a company gets in its product categories

Copyright ©2014 by Pearson Education, Inc. All rights reserved

 Capturing Value from Customers
Creating Customer Loyalty and Retention

• Customer lifetime value is the value of the entire stream of

purchases that the customer would
make over a
lifetime of
patronage

Copyright ©2014 by Pearson Education, Inc. All rights reserved







 Capturing Value from Customers

Customer equity is
the total combined customer
lifetime values of all of the
company’s customers

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 6 The Changing Marketing Landscape

• Digital Age
• Changing Economic Environment
• Growth of Not-for-Profit Marketing
• Rapid Globalization
• Sustainable Marketing

 The Changing Marketing

Landscape
The Digital Age

•Online marketing is the fastest-growing

•Brick- and- mortar companies evolved

•How do you think technology has

changed the way in which
marketers deliver value?

•Think of your favorite brands. Do

they engage in online actions to
generate value? What actions?

 MRS MAISEL

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 The Changing Marketing Landscape

Not-for-profit marketing growth

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• How can non-for-profit organizations use marketing?
The Changing Marketing
Landscape

Sustainable Marketing
The Changing Marketing
Landscape

Sustainable Marketing

VIDEO: Nike better world

The environmental cost of everything
we make is astonishing. Consider the
R2® Jacket shown, one of our best
sellers. To make it required 135 liters
of water, enough to meet the daily
needs (three glasses a day) of 45
people. Its journey from its origin as
60% recycled polyester to our Reno
warehouse generated nearly 20
pounds of carbon dioxide, 24 times the
weight of the finished product. This
jacket left behind, on its way to Reno,
two-thirds its weight in waste.

http://www.patagonia.com/email/11/112811.html
 The Changing Marketing Landscape

• Rapid Globalization

• What do you think are the

challenges of globalization
for firms?







 So, What Is Marketing?
Putting It All Together

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Education, Inc. All rights Prentice Hall