Marketing lecture 1
Purpose of business:
- Marketing
- Innovation
Marketing functions:
- Attract
- Maintain
What does this tell us?
1. Marketing is a central role for business success.
- Failure mostly happens because of lack of attention for customer needs
2. Cost of attracting customers is 6x higher than maintaining customers
a. Importance of building relationships with customers by providing satisfaction
b. Importance of attracting new customers by adding value
3. Need to monitor and understand competitors because if customer’s needs are
not met that is where the customers will go
Modern marketing concept = the achievement of corporate goals through meeting and
exceeding customer needs better than your competitors
There are 3 conditions for the concept
1. Customer orientation
2. Integrated effort
3. Goal achievement
Evolution of marketing:
Dates back to industrial revolution (Britain 1750, Germany, USA, 1830)
1950s/1960s emphasis lies more on ‘how to do marketing’, so the techniques
,1930 Production orientation =
focus on current production capabilities.
Purpose of organisation is to develop products or services.
Quality and innovativeness are keys to success
1950s Sales orientation =
door to door selling.
May possess good products/services but they believe that the focus of marketing should be
on ensuring that customers buy these offerings
Post-World War ll, US mass production had a surplus, aggressive sales efforts were required
(pharmaceuticals)
1960s Customer orientation =
Get closer to the customer and understand needs and problems. This was failure of
excessively product or sales focused businesses.
- Building trust
- Know what you can receive from any company
- Loyalty
Recent Value based/societal marketing: now, You now what you pay for:
Sustainable marketing, marketing strategy should deliver value to customers in a way that
maintains or improves both consumer’s and society’s well-being. (reducing pollution and
meeting customer expectations)
- Brand name
- What you think is cool
- Allows customers to not switch make them willing to pay more
THERE IS NO GUARANTEE THAT ALL COMPANIES WILL ADOPT A MARKETING ORIENTATION
,Market-driven/ outside-in firms = seek to anticipate as well as identify consumer needs and
build the resource profiles necessary to meet current and anticipated future demand.
Leading customers needs!
Scope of marketing / social marketing = use of marketing techniques in order to change or
maintain people’s behaviour for the benefit of the individual or society as a whole (politics,
anti-smoking, alcohol awareness, sun safety etc.)
Customer Value = perceived benefits - perceived sacrifice
Perceived benefits = can be derived from the product, associated service and image of brand
Perceived sacrifices =
- Monetary costs
- Time and energy costs
- Energy costs
- Psychological costs of not
making the right decision
Sacrifice = what you are willing to do to
get the product
, Offered value should exceed that of competitors. Customers decide on purchases on the
basis of judgements about the value offered by different suppliers -> once purchased,
customer satisfaction depends on its perceived performance compared to the buyer’s
experience, discussions with other people and supplier’s marketing activities
Customer satisfaction:
Kano model: separates characteristics that cause
dissatisfaction, satisfaction and delight.
- must bes are expected, thus taken for granted (e.g.
planes must depart on time)
- more is better characteristics can take satisfaction
past neutral and into the positive satisfaction
range (e.g. no response to a call = dissatisfaction,
quick response = rise to positive satisfaction)
- delighters are unexpected characteristics that
surprise the customer, their absence does not
cause dissatisfaction but their presence generates
delight (you book standard room, but get upgraded room. Free pastry in café on
birthday)
4 different forms of customer value:
1. Price value: customers perceive a product as being cheaper than those offered by
competitors
- Low price, low service, basic product
- But value through price, so you will get the value due to the amount you paid
e.g. Ryanair, Aldi
2. Performance value: customers look for the latest features, functionality and quality
- functionality features
- show what you van do with the product
e.g. Dyson
3. Emotional value: what is in the mind of the customers
- can be luxury products, as a person you feel close to the brand
- difference between products are minimal but the emotional relation is the deciding
factor which is created by marketing activity
e.g. Porsche and luxury/speed/safety, Massimmo Dutti and style, you buy your new
Apple iPhone because you always did because of loyalty
Purpose of business:
- Marketing
- Innovation
Marketing functions:
- Attract
- Maintain
What does this tell us?
1. Marketing is a central role for business success.
- Failure mostly happens because of lack of attention for customer needs
2. Cost of attracting customers is 6x higher than maintaining customers
a. Importance of building relationships with customers by providing satisfaction
b. Importance of attracting new customers by adding value
3. Need to monitor and understand competitors because if customer’s needs are
not met that is where the customers will go
Modern marketing concept = the achievement of corporate goals through meeting and
exceeding customer needs better than your competitors
There are 3 conditions for the concept
1. Customer orientation
2. Integrated effort
3. Goal achievement
Evolution of marketing:
Dates back to industrial revolution (Britain 1750, Germany, USA, 1830)
1950s/1960s emphasis lies more on ‘how to do marketing’, so the techniques
,1930 Production orientation =
focus on current production capabilities.
Purpose of organisation is to develop products or services.
Quality and innovativeness are keys to success
1950s Sales orientation =
door to door selling.
May possess good products/services but they believe that the focus of marketing should be
on ensuring that customers buy these offerings
Post-World War ll, US mass production had a surplus, aggressive sales efforts were required
(pharmaceuticals)
1960s Customer orientation =
Get closer to the customer and understand needs and problems. This was failure of
excessively product or sales focused businesses.
- Building trust
- Know what you can receive from any company
- Loyalty
Recent Value based/societal marketing: now, You now what you pay for:
Sustainable marketing, marketing strategy should deliver value to customers in a way that
maintains or improves both consumer’s and society’s well-being. (reducing pollution and
meeting customer expectations)
- Brand name
- What you think is cool
- Allows customers to not switch make them willing to pay more
THERE IS NO GUARANTEE THAT ALL COMPANIES WILL ADOPT A MARKETING ORIENTATION
,Market-driven/ outside-in firms = seek to anticipate as well as identify consumer needs and
build the resource profiles necessary to meet current and anticipated future demand.
Leading customers needs!
Scope of marketing / social marketing = use of marketing techniques in order to change or
maintain people’s behaviour for the benefit of the individual or society as a whole (politics,
anti-smoking, alcohol awareness, sun safety etc.)
Customer Value = perceived benefits - perceived sacrifice
Perceived benefits = can be derived from the product, associated service and image of brand
Perceived sacrifices =
- Monetary costs
- Time and energy costs
- Energy costs
- Psychological costs of not
making the right decision
Sacrifice = what you are willing to do to
get the product
, Offered value should exceed that of competitors. Customers decide on purchases on the
basis of judgements about the value offered by different suppliers -> once purchased,
customer satisfaction depends on its perceived performance compared to the buyer’s
experience, discussions with other people and supplier’s marketing activities
Customer satisfaction:
Kano model: separates characteristics that cause
dissatisfaction, satisfaction and delight.
- must bes are expected, thus taken for granted (e.g.
planes must depart on time)
- more is better characteristics can take satisfaction
past neutral and into the positive satisfaction
range (e.g. no response to a call = dissatisfaction,
quick response = rise to positive satisfaction)
- delighters are unexpected characteristics that
surprise the customer, their absence does not
cause dissatisfaction but their presence generates
delight (you book standard room, but get upgraded room. Free pastry in café on
birthday)
4 different forms of customer value:
1. Price value: customers perceive a product as being cheaper than those offered by
competitors
- Low price, low service, basic product
- But value through price, so you will get the value due to the amount you paid
e.g. Ryanair, Aldi
2. Performance value: customers look for the latest features, functionality and quality
- functionality features
- show what you van do with the product
e.g. Dyson
3. Emotional value: what is in the mind of the customers
- can be luxury products, as a person you feel close to the brand
- difference between products are minimal but the emotional relation is the deciding
factor which is created by marketing activity
e.g. Porsche and luxury/speed/safety, Massimmo Dutti and style, you buy your new
Apple iPhone because you always did because of loyalty
