Hit a Home Run with Customers

4.1 The Marketing Concept

4.2 Discover What People Want

4.3 Target Markets

4.4 Customer Service

2

Winning Strategies

• U.S. teenagers spend $175 billion annually• teens are trendsetters and early adopters• teens offer a potential lifetime of purchasing for

products they start to use when they are young• in an effort to obtain teen customers, Frito-Lay

initiated a variety of innovative marketing techniques involving music partnerships– this strategy resulted in a huge return on investment

Frito-Lay Reaches Teens

3

Lesson 4.1

The Marketing ConceptGoals• Explain the central focus of the marketing

concept.• Explain the reasons for increased sports

and entertainment options.

4

OPENING ACTPage 92

• Determine the popularity of Hershey’s within your group.

• How many in your group enjoy snacks while enjoying entertainment events?

• Do snack companies often advertise at or sponsor events you have attended?

• Should Hershey’s be concerned about the obesity trend among youth and its possible relationship to Hershey products?

5

THE MARKETING CONCEPT

• About half of every consumer dollar spent pays for marketing costs.

• Satisfying customer needs is the most important aspect of marketing.

• marketing concept– keeping the focus on the customer’s needs

for a product or service

6

Maintain Relationships

• Successful customer relationships are critical to the marketing concept.

• Customer satisfaction is the bottom line for maintaining successful marketing relationships.

7

• What is the most important aspect of marketing?

– Satisfying consumer needs.

8

INCREASED SPORTS AND ENTERTAINMENT OPTIONS

• U.S. citizens have more discretionary income than in the past.– drives up demand for sports & entertainment

• higher prices • increased competition

– More Competition = More Consumer Choice• improved products, events, merchandise

9

Customer Focus

• productivity– rate at which companies produce goods or

services in relation to the amount of materials and number of employees utilized

10

• successful marketing strategy – identify customer needs

• provide products perceived as superior

– identify prospective consumers & locations• maintain successful customer relationships• offer the appropriate marketing mix

– BEST product (product)– ACCEPTABLE price (price)– WHERE demanded (place – location)– EDUCATE consumers (promotion)

11

Weekend Entertainment Choices

• What do you do for entertainment on the weekend?

– Movies– Video Games– Mall– Concerts– Sporting Events

12

Weekend Entertainment Choices

• breakeven point– the minimum sales and attendance required

to cover all of the expenses of organizing, planning and promoting the event

• profit– revenue earned beyond the breakeven point

13

Opportunity Cost

• How do you decide what to spend your discretionary income on?

– Consider the following:–Convenience–Pleasure–Dollar cost–Opportunity cost

14

Opportunity Cost

• opportunity cost

– the value of the next best alternative that you forgo when making a choice

– The value is measured in terms of the benefits that you are giving up.

15

• Explain the reasons for increased sports and entertainment options.

– Increasing population & discretionary income– Increasing demand, more competition– Increasing competition, more consumer choices

16

Lesson 4.2

Discover What People Want

Goals• Explain the importance of understanding

buyer behavior when making marketing decisions.

• List and describe means of collecting marketing information for use in decision making.

17

OPENING ACT Page 97

• Discuss how you would research possible sponsors.

• What information would you need to ensure a mutually beneficial relationship?

--

18

UNDERSTAND BUYER BEHAVIOR

• economic market– all of the consumers who will purchase a

product or service

– Two major goals:• Determine what consumers want• How much they are willing to spend

--

19

Consumer Spending Habits

• Research spending habits of consumers.

• The price fans are willing to pay relates to their perception of the benefits derived.

• benefits derived– the value people believe they

receive from a product or service

20

• comparative advantage– the capability to produce products or

services more efficiently and economically than the competition

– Should be able to pass along production cost savings to the consumers in the form of LOWER PRICES.

21

Consumer Wants and Needs

• hierarchy of needs– Abraham Maslow (American Psychologist) – identifies five human areas of needs– Referenced when studying human behavior

– Levels of needs must be met one level at a time.

--

22

23

1. emotional purchases– spend with little thought during emotional times

2. rational purchases– define wants and needs– assess priorities and budget– conduct research– compare alternatives– make a well thought out purchase

Buying Motives

24

3. patronage purchases– based on loyalty to a particular brand or

product

Buying Motives

25

• What is meant by benefits derived?

– Value that people believe they receive from buying a product or service.

26

• Consumer decision-making process involves the following steps.

– recognize a need or a want– conduct product research– evaluate choices– decide what to purchase– evaluate the product after the purchase

GATHER INFORMATION

27

GATHER INFORMATION

• Marketers must be aware of the decision making process.

• Marketers are often involved in every step of the decision-making process.

– Recognize the need– Provide information– Assist with purchase– Follow-up (ensure satisfaction) --

28

Information Needed for Marketing Decisions

• Information about consumers that is important to consider include:

– demographics– shopping behaviors– how consumers spend money– product and brand preferences– frequency of purchases

29

– economic uncertainty reduces consumer spending (postpone large purchases)

– marketplace competition & product quality provides consumers with choices

– Government regulations, laws, ethics

– technological advances have impacted how consumers research and buy products

• The business environment impacts consumer spending as follows:

30

Sources of Information for Businesses

• internal sources– a business’s own customer records, sales

records, production records, and operation records

• external sources– government reports, trade and professional

organizations, business publications, commercial data, and information services

31

• primary data– obtained for the first time and specifically

for the particular problem or issue being studied

• secondary data– information previously collected for another

purpose but is now found useful in the current study

32

• Explain the difference between primary and secondary data.

– Primary: obtained 1st time for specific problem– Secondary: previously collected, other

purpose

33

Lesson 4.3

Target Markets

Goals• Define target market and market segment.• Describe how businesses use market

segmentation.

34

OPENING ACTPage 103

• What has contributed to their sales success?

• How can these brands maintain high sales during periods when the teams are not winning games?

35

DETERMINE THE TARGET MARKET

• STEP ONE: Determine who specifically “the customer” is for your product.

• target market– specific group of consumers you want to reach

--

36

Focus Marketing Efforts

• market segment– a group of consumers within a larger market

who share one or more characteristics

• Consumers belong to multiple market segments.

• Marketers must identify the market segment to which they want to sell.

37

Meet Target Market Needs

• Market segmentation data can improve business decision making.– number of potential customers– customer income level– level of interest in product or service

38

• What is a market segment?– a group of consumers within a larger market

who share one or more characteristics

• What is a target market?– The specific group of consumers you want to

reach. (specific market segment you target)

39

MARKET SEGMENTATION• Markets may be segmented in many ways.

– geographic location– demographics– psychographics– behavior

(breakdown over next 4 slides) --

40

Geographic Segmentation

• divides markets into physical locations:

– Eastern, Northern, Southern, Western

– Rural vs. Urban

41

Demographic Segmentation

• information that can be measured:– age– income– profession– gender– education– marital status– household size

42

Psychographics Segmentation

• characteristics that cannot be physically measured: – values– interests– lifestyle choices

43

Behavioral-Based Segmentation

• focuses on a customer’s attitude toward products and services

– product usage• what products you use and how often

– product benefits• the positive experiences or associations people

derive from using a product or service

44

Capture a Market Share

• market share– percentage of total sales of a product or

service that a company expects to capture in relation to its competitors

45

• List and describe four types of market segmentation.

– Geographic– Demographic– Psychographic– Behavior-Based

46

Lesson 4.4

Customer Service

Goals• Explain the importance of outstanding

customer service.• Explain what it means to establish a

service culture.

47

OPENING ACTPage 108

• Discuss the last time you received bad customer service.

• Describe the event and the end results.

48

OUTSTANDING SERVICE EQUALS SUCCESS

• Business success depends on excellent customer service.

• Customer Expectations include:– Safe, comfortable environment– Value for money spent

• Customer relationships should continue after the sale of goods and services.

49

A Track Record for Great Customer Service

• customer service gap– the difference between customer expectations

and the services actually received

• Customers are likely to tell at least 10 people about their poor customer service experiences.

50

Examples of Bad Customer Service?

• Chatting on the phone or with others while customers are waiting to be served.

• Dismissing a customer by whining, “that’s not my department”

• Placing a calling customer on hold for long periods of time and transferring them from department to department.

• Yelling at customers who fail to understand company policies.

• Failing to follow up with customers in a timely manner.

51

Training Programs That Make an Impact

• Individuals hired for customer service positions should have a positive attitude and look forward to meeting the public.

• Proper employee training in proactive, efficient and courteous customer service is critical to providing a pleasant experience for customers.

52

• Why is outstanding customer service critical to a business in a highly competitive marketplace?

– Sets the business apart from the competition– Repeat business comes from good C.S.

53

CREATING A SERVICE CULTURE

• Gallery Furniture:– Biggest single retail store in America– Jim McIngvale “Mattress Mack” (Houston Icon) – Hosts professional Tennis Matches– Hosts college bowl game

– Success attributed to strong work ethic, outstanding customer service & principles that guide the business.

54

1. Demonstrate a values-based culture that is rooted in high performance and excellent customer service.

2. Follow the “FAST” strategy. (F ocus, A ction, S earch, T enacity)

3. Passion results in energy.

4. Demonstrate pride in every sale.

5. Remember the value of long-term positive relationships.

Effective Customer Service Principles

55

How May I Help You?

• “It’s not my department” should be replaced with “How may I help you?”

• mystery guest– hired by an outside firm to have an individual

assess the performance of a business • feedback on the individual’s experience as a

customer is provided to the hiring business

56

• Explain what it means to have a values-based culture.

– Rooted in high performance and excellent customer service.

– Employees will do whatever is necessary to keep commitments made to customers.