INTRODUCTION TO MARKETING
Contents
Topic 1: creating & capturing customer value .......................................................... 1
Topic 2: The market environment .......................................................................... 13
Topic 3 – Business Markets – B2B Marketing .......................................................... 29
Topic 1: creating & capturing customer value
What is marketing?
Marketing is about people
Respecting 5 universal human values: truth, peace, love, nonvidance & correct
behavior.
Always respecting what people want: security, safety, variation, surprises, challenges,
importance, values.
Marketing (1) empowers people to make right decisions and (2) encourages people to
do what they want.
Aim of marketing
The aim of marketing is to know and understand the customer so well that the product
or services fits them and sells itself. (Peter Drucker)
Marketing is the process by which companies create value for customers and build
strong customer relationships to capture value from customers in return.
The marketing process: -> analysis -> strategy -> tactics -> implementation and
evaluation
1. Create value for customers
1) Marketing analysis: understand the market place and customers needs &
wants.
2) Marketing strategy: design a customer-driven marketing strategy.
3) Marketing mix: construct an integrated marketing program that delivers
superior value.
4) Customer relationships: build profitable relationships and create customer
delight.
1
, 2. Capture value from customer in return
5) Implementation & control: capture value from customer to create profits &
customer equity.
What is marketing?
“marketing is a social and managerial process by which individuals and groups obtain
what they need and want through creating, offering, and exchanging products of value
with other” (T.Levitts)
1. Understand the marketplace and customer needs and wants.
a) Customer needs, wants & demands
- Needs: states of felt deprivation
Types: physical needs, social needs, individual needs.
- Wants: the form human needs take as they are shaped by culture and
individual personality.
- Consumers seek to maximize their satisfaction
Examples: need = food (Americans want McDo) (Belgians want fries)
-Demands: humans wants that are backed by buyer power.
-Given their wants and resources, people demand products with benefits
that add up to the most value and satisfaction, for the money they spend.
- Wants and demands are unlimited, but consumers means aren’t.
b) Marketing offerings
- Consumers needs and wants are fulfilled thru market offerings. -> some
combination of products, services, information or experiences offered to
a market satisfy a need or want.
- Purpose = to create a brand experience.
- 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.
The product fails to adapt to the constantly changing patterns of
consumers needs and tastes.
2
, - Marketers create brand meaning by associating characteristics to a brand
and by creating brand experiences. This adds an intangible dimension to a
product, an immaterial value.
- A brand = a bundle of benefits with sustainable differentiation potential.
c) Customer-perceived value
- Perceived value: the difference between all benefits and costs of a market
offering compared to competitor’s offers.
- Clients choose the brand that offers the highest value for their money!
- Customer satisfaction: the extent to which perceived product
performance matches customer expectations.
- Performance < expectations -> dissatisfaction
- Performance = expectations -> satisfaction
- Performance > expectations -> delightment
- customer satisfaction leads to loyalty. Yet, do not attempt to maximize
customer satisfaction at any price. Lowering price, increasing service ->
lowering profits.
- Delivering quality is meeting expectations.
d) Exchanges and relationships
- Exchange: the act of obtaining a desired object from someone by offering
something in return.
- Relationships: marketing consists of actions taken to build and maintain
desirable exchange relationships with target audiences. These include:
acquisition, stimulation, retention.
The goal is to build long term relationships with loyal customers, not just creating one
transaction.
e) Markets
- Market: the set of all actual and potential buyers of a product or service.
- Economics: the abstract mechanisms where by supply and demand
confront each other and deals are made.
Marketing means to manage markets in order to bring profitable customer
relationships.
2. Design a customer-driven marketing strategy
1. Planning
- The process of formulating responses to possible future events.
- Importance of planning: aligns activities of departments, stimulates
forward thinking & agility, stimulates to focus on certain goals & control
results.
2. Levels of planning
3
, 1) Concern or company (mission and vision, industry play field, 5y or 3y
strategic plan)
2) Strategic business units (SBU): company division, product line within a
division, single product or brand.
3) Product or market combination (PMC): eg. Stella Artois
3. Strategic plan
- What is a strategy? = game plan for long-run survival & growth (given a
specific situation)
- What is a strategic planning? = the process of developing & maintaining a
strategic fit between the organization goals & capabilities and its changing
marketing opportunities.
- What is a S.W.O.T analysis? Each level of strategic planning describes how
the company will adapt, an effort is made to match its own capabilities.
(strengths) and possible weaknesses with the opportunities and threats
in the changing environment.
S: strengths (pos)
W: weaknesses (neg) SWOT analysis
O: opportunities (pos)
T: threats (neg)
4. Mission & vision
- Vision = view of what the organization should; often comes from the
founder. There should be continuity vision.
- Mission = the purpose of the organization; what it wants to accomplish in
the larger environments. Usually in a statement, motho, slogan -> what do
we do, for whom, how and why?
- Objectives: the mission of a company needs to be translated in objectives
on different levels: Company, SBU, PMC
Objectives need to be SMART
Specific
Measurable
Achievable
Realistic
Time-bound
- Purpose: not what you do, but why you do it. Purpose driven companies
outperform their counterparts in stock by price.
5. Marketing management
= choosing target markets and building profitable relationships with them.
A marketing manager should always strive at building profitable relationship
with customers.
4
Contents
Topic 1: creating & capturing customer value .......................................................... 1
Topic 2: The market environment .......................................................................... 13
Topic 3 – Business Markets – B2B Marketing .......................................................... 29
Topic 1: creating & capturing customer value
What is marketing?
Marketing is about people
Respecting 5 universal human values: truth, peace, love, nonvidance & correct
behavior.
Always respecting what people want: security, safety, variation, surprises, challenges,
importance, values.
Marketing (1) empowers people to make right decisions and (2) encourages people to
do what they want.
Aim of marketing
The aim of marketing is to know and understand the customer so well that the product
or services fits them and sells itself. (Peter Drucker)
Marketing is the process by which companies create value for customers and build
strong customer relationships to capture value from customers in return.
The marketing process: -> analysis -> strategy -> tactics -> implementation and
evaluation
1. Create value for customers
1) Marketing analysis: understand the market place and customers needs &
wants.
2) Marketing strategy: design a customer-driven marketing strategy.
3) Marketing mix: construct an integrated marketing program that delivers
superior value.
4) Customer relationships: build profitable relationships and create customer
delight.
1
, 2. Capture value from customer in return
5) Implementation & control: capture value from customer to create profits &
customer equity.
What is marketing?
“marketing is a social and managerial process by which individuals and groups obtain
what they need and want through creating, offering, and exchanging products of value
with other” (T.Levitts)
1. Understand the marketplace and customer needs and wants.
a) Customer needs, wants & demands
- Needs: states of felt deprivation
Types: physical needs, social needs, individual needs.
- Wants: the form human needs take as they are shaped by culture and
individual personality.
- Consumers seek to maximize their satisfaction
Examples: need = food (Americans want McDo) (Belgians want fries)
-Demands: humans wants that are backed by buyer power.
-Given their wants and resources, people demand products with benefits
that add up to the most value and satisfaction, for the money they spend.
- Wants and demands are unlimited, but consumers means aren’t.
b) Marketing offerings
- Consumers needs and wants are fulfilled thru market offerings. -> some
combination of products, services, information or experiences offered to
a market satisfy a need or want.
- Purpose = to create a brand experience.
- 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.
The product fails to adapt to the constantly changing patterns of
consumers needs and tastes.
2
, - Marketers create brand meaning by associating characteristics to a brand
and by creating brand experiences. This adds an intangible dimension to a
product, an immaterial value.
- A brand = a bundle of benefits with sustainable differentiation potential.
c) Customer-perceived value
- Perceived value: the difference between all benefits and costs of a market
offering compared to competitor’s offers.
- Clients choose the brand that offers the highest value for their money!
- Customer satisfaction: the extent to which perceived product
performance matches customer expectations.
- Performance < expectations -> dissatisfaction
- Performance = expectations -> satisfaction
- Performance > expectations -> delightment
- customer satisfaction leads to loyalty. Yet, do not attempt to maximize
customer satisfaction at any price. Lowering price, increasing service ->
lowering profits.
- Delivering quality is meeting expectations.
d) Exchanges and relationships
- Exchange: the act of obtaining a desired object from someone by offering
something in return.
- Relationships: marketing consists of actions taken to build and maintain
desirable exchange relationships with target audiences. These include:
acquisition, stimulation, retention.
The goal is to build long term relationships with loyal customers, not just creating one
transaction.
e) Markets
- Market: the set of all actual and potential buyers of a product or service.
- Economics: the abstract mechanisms where by supply and demand
confront each other and deals are made.
Marketing means to manage markets in order to bring profitable customer
relationships.
2. Design a customer-driven marketing strategy
1. Planning
- The process of formulating responses to possible future events.
- Importance of planning: aligns activities of departments, stimulates
forward thinking & agility, stimulates to focus on certain goals & control
results.
2. Levels of planning
3
, 1) Concern or company (mission and vision, industry play field, 5y or 3y
strategic plan)
2) Strategic business units (SBU): company division, product line within a
division, single product or brand.
3) Product or market combination (PMC): eg. Stella Artois
3. Strategic plan
- What is a strategy? = game plan for long-run survival & growth (given a
specific situation)
- What is a strategic planning? = the process of developing & maintaining a
strategic fit between the organization goals & capabilities and its changing
marketing opportunities.
- What is a S.W.O.T analysis? Each level of strategic planning describes how
the company will adapt, an effort is made to match its own capabilities.
(strengths) and possible weaknesses with the opportunities and threats
in the changing environment.
S: strengths (pos)
W: weaknesses (neg) SWOT analysis
O: opportunities (pos)
T: threats (neg)
4. Mission & vision
- Vision = view of what the organization should; often comes from the
founder. There should be continuity vision.
- Mission = the purpose of the organization; what it wants to accomplish in
the larger environments. Usually in a statement, motho, slogan -> what do
we do, for whom, how and why?
- Objectives: the mission of a company needs to be translated in objectives
on different levels: Company, SBU, PMC
Objectives need to be SMART
Specific
Measurable
Achievable
Realistic
Time-bound
- Purpose: not what you do, but why you do it. Purpose driven companies
outperform their counterparts in stock by price.
5. Marketing management
= choosing target markets and building profitable relationships with them.
A marketing manager should always strive at building profitable relationship
with customers.
4
