5/26/2022

CHAPTER 1
MARKETING: CREATING
CUSTOMER VALUE AND
ENGAGEMENT
THU NGUYEN

LEARNING OBJECTIVES
1. Define marketing and outline the steps in the marketing process.
2. Explain the importance of understanding the marketplace and customers and
identify the five core marketplace concepts.
3. Identify the key elements of a customer value–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.
5. Describe the major trends and forces that are changing the marketing
landscape in this age of relationships.

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SUMMARY
LO1: Define marketing and outline the steps in the marketing process
• Marketing as the process by which companies engage customers, build strong customer
relationships, and create customer value in order to capture value from customers in return.
• The twofold goal of marketing is:
o to attract new customers by promising superior value
o to keep and grow current customers by delivering value and satisfaction.

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SUMMARY
LO2: Explain the importance of understanding the marketplace and customers and identify
the five core marketplace concepts.

Market offerings
Needs
(products, Value and Exchange and
Wants Markets
services, and satisfaction relationships
Demands
experiences)

Companies address
needs, wants, and The value
demands by putting proposition is fulfilled
forth a value through a market Long-term exchange
proposition (a set of offering, which relationships with
benefits that they delivers customer customers
promise to value and
consumers to satisfy satisfaction
their needs)

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SUMMARY
LO2: Explain the importance of understanding the marketplace and customers
and identify the five core marketplace concepts (cont.).
Marketers did
• Human needs are states of felt deprivation. They include basic physical needs for not create
food, clothing, warmth, and safety; social needs for belonging and affection; and these needs;
individual needs for knowledge and self-expression. they are a basic
part of the
• Wants are the form human needs take as they are shaped by culture and individual human makeup
personality and are described in terms of objects that will satisfy those need.
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Need Want
Food Instant noodle, ice cream

• When backed by buying power, wants become demands.

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SUMMARY
LO2: Explain the importance of understanding the marketplace and customers
and identify the five core marketplace concepts (cont.).
• Consumers’ needs and wants are fulfilled through market offerings—some
combination of products, services, information, or experiences offered to a market to
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satisfy a need or a 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.

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SUMMARY
LO2: Explain the importance of understanding the marketplace and customers and
identify the five core marketplace concepts (cont.).
• Customer- perceived value: the difference between total customer perceived benefits
and customer cost.
• Customer satisfaction: the extent to which perceived performance matches a buyer’s
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expectations.
• Customer value and customer satisfaction are key building blocks for developing and
managing customer relationships.
4 • Exchange is the act of obtaining a desired object from someone by offering something in
return.

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SUMMARY
LO2: Explain the importance of understanding the marketplace and customers and identify
the five core marketplace concepts (cont.).
• A market is the set of actual and potential buyers of a product or service. These buyers share a
5 particular need or want that can be satisfied through exchange relationships.
• Marketers are no longer asking only “How can we influence our customers?” but also “How
can our customers influence us?” and even “How can our customers influence each
other?”

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SUMMARY
LO3: Identify the key elements of a customer value–driven marketing strategy and
discuss the marketing management orientations that guide marketing strategy
The expanded model of the marketing process

Preparing an
Marketing
Selecting Choosing a Value Integrated
Management
Customers to Serve Proposition Marketing Plan and
Orientations
Program

Market segmentation How the company will Five alternative concepts
and target marketing differentiate and under which organizations
position itself in the design and carry out
marketplace. their marketing strategies:
the production, product,
selling, marketing, and
societal marketing
concepts.
The major marketing mix
tools are classified into
four broad groups, called
the four Ps of marketing:
product, price, place,
and promotion
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SUMMARY
LO3 (cont.): Identify the key elements of a customer value–driven marketing strategy and
discuss the marketing management orientations that guide marketing strategy
Five alternative concepts under which organizations design and carry out their marketing
strategies.

Societal
Production Product Selling Marketing
Marketing
concept concept concept concept
concept

holds that consumers holds that consumers consumers will not buy holds that achieving holds that generating
will favor products will favor products enough of the firm’s organizational goals customer satisfaction and
that are available and that offer the most in products unless the firm depends on knowing the long-run societal
highly affordable quality, performance, undertakes a large-scale needs and wants of target well-being through
and innovative selling and promotion markets and delivering the sustainable marketing
focus on improving features effort desired satisfactions strategies is key to both
production and better than competitors do achieving the company’s
distribution efficiency focus on making focuses on creating sales goals and fulfilling its
continuous product transactions rather than find the right customers responsibilities.
improvements on building long-term, for your product but to find
profitable customer the right products for your
relationships customers.
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SUMMARY
LO4: Discuss customer relationship management and identify strategies for creating
value for customers and capturing value from customers in return

Managing
Customer
Relationships
and Capturing
Customer Value

Engaging Capturing
Customers Value from
and Customers
Managing
Customer
Relationships
• Customer Relationship
Management • Creating Customer Loyalty and
• Customer engagement, Retention
consumer-generated marketing • Growing Share of Customer
• Partner relationship • Building Customer Equity
management
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SUMMARY
LO4: Discuss customer relationship management and identify strategies for creating
value for customers and capturing value from customers in return (cont.)
• Customer relationship management is the process of engaging customers and building
and maintain in profitable customer relationships by delivering superior customer value
and satisfaction.
• Customer-engagement marketing aims to make a brand a meaningful part of
consumers’ conversations and lives through direct and continuous customer involvement
in shaping brand conversations, experiences, and community.
✓ One form of customer-engagement marketing is consumer-generated marketing by
which consumers themselves play role in shaping their own brand experiences and
those of others
• Partner relationship management: working closely with partners in other company
departments and outside the company to jointly bring greater value to customers

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SUMMARY
LO4: Discuss customer relationship management and identify strategies for creating
value for customers and capturing value from customers in return (cont.)
• The aim of customer relationship management and customer engagement is to produce
high customer equity, the total combined customer lifetime values of all of the
company’s customers.
• The key to building lasting relationships is the creation of superior customer value and
satisfaction.

There is a good fit between There is a strong fit between

the company’s offerings and their needs and
their needs the company’s offerings

There is little fit There is a limited fit between

between the company’s their needs and the
offerings and their needs company’s offerings

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SUMMARY
LO5: Describe the major trends and forces that are changing the marketing landscape in
this age of relationships.
• The Digital Age: Online, Mobile, and Social Media Marketing:
o Digital and social media marketing involves using digital marketing tools such as web
sites, social media, mobile ads and apps, online videos, e-mail, and blogs that engage
consumers anywhere, at any time, via their digital devices.
✓ Social Media Marketing
✓ Mobile Marketing
• The Changing Economic Environment
• The Growth of Not-for-Profit Marketing
• Rapid Globalization
• Sustainable Marketing—The Call for More Environmental and Social Responsibility

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SO, WHAT IS MARKETING? PULLING IT ALL TOGETHER

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DISCUSSION
1. Some believe that social marketing is primarily effective only for bigger
companies with the time and capacity to manage and update their media
content. Choose a local business and evaluate its effectiveness in creating
customer engagement. Is the content up-to-date and relevant? How does it
manage its content?
2. Is it right for marketers to track consumer purchases? Should consumers be
concerned with what information is being used?

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