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Principle of marketingPrinciple of marketing

Presenting by:Presenting by:

Muhammad Irfan Waheed (55206)Muhammad Irfan Waheed (55206)Muniba Islam (55093)Muniba Islam (55093)

Muhammad Sajid (54669)Muhammad Sajid (54669)

Waqar Hussain (55026)Waqar Hussain (55026)

Rehmatullah Abdul Aziz (54210)Rehmatullah Abdul Aziz (54210)

Supervised by:Supervised by:

Mr. Imran AzamMr. Imran Azam

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Chapter One

Marketing: Creating andCapturing Customer Value

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What Is Marketing?

Marketing is a process by which companies

create value for customers and build strong

customer relationships to capture value from

customers in return.

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Understanding the

marketplace &

customer needs &wants

Design a

customer-drivenmarketing

strategy

Construct an

integrated

marketing

program thatdeliver superior

value

Build

profitable

relationship &

create

customerdelight

Capture value

from customers

to create profits& customer

equity

Model of Marketing Process

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Understanding the Marketplace

and Customer Needs

Customer needs, wants, and demands

Market offerings

Value and satisfaction

Exchanges and relationships

Markets

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Understanding the Marketplace

andC

ustomer Needs States of deprivation

Physical²food, clothing,warmth, safety

Social²belonging and affection

Individual²knowledge andself-expression

Needs

Form that needs take as theyare shaped by culture andindividual personality

Wants

Wants backed by buyingpowerDemands

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Understanding the Marketplace

and Customer Needs

Market offerings are some combination of products, services, information, or experiencesoffered to a market to satisfy a need or want.

Marketing myopia is focusing only on existingwants and losing sight of underlying consumer

needs.

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Understanding the Marketplace

and Customer Needs

Customer Value and Satisfaction Expectations

Customers Value and

satisfaction

Marketers Set the right level

of expectations

Not too high orlow

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Exchange is the act of obtaining a desired

object from someone by offering something in

return

Markets are the set of actual and potential

buyers of a product

Understanding the Marketplace

and Customer Needs

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The Modern Marketing System

 MajorEnvironmental

Forces

 MajorEnvironmental

Forces

 MajorEnvironmental

Forces

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Designing a Customer-Driven

Marketing Strategy

Marketing management is the art and science of 

choosing target markets and building profitable

relationships with them

oWhat customers will we serve?

o How can we best serve these customers?

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Designing a Customer-Driven

Marketing Strategy

Market segmentation refers to dividing the

markets into segments of customers

Target marketing refers to which segments to go

after

Demarketing is marketing to reduce demand

temporarily or permanently; the aim is not to

destroy demand but to reduce or shift it.

Selecting Customers to Serve

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Designing a Customer-Driven

Marketing StrategyChoosing a Value Proposition

The value proposition is the set of benefits or

values a company promises to deliver to

customers to satisfy their needs.

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Designing a Customer-Driven

Marketing Strategy

Production 

concept

Product

concept

elling 

concept

rketing 

concept

ociet l

concept

Marketing Management Orientations

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Production concept is the idea that consumers will

favor products that are available or highly

affordable.Product concept is the idea that consumers will

favor products that offer the most quality,

performance, and features. Organization should

therefore devote its energy to makingcontinuous product improvements.

Designing a Customer-Driven

Marketing Strategy

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Selling concept is the idea that consumers will

not buy enough of the firms products unless

it undertakes a large scale selling andpromotion effort.

Designing a Customer-Driven

Marketing Strategy

Profitthrough

salesvolume

Selling & Promotion

ExistingProduct

Factory

StaringPoint

Focus Means Ends

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Marketing concept is the idea that achieving

organizational goals depends on knowing the

needs and wants of the target markets and

delivering the desired satisfactions better

than competitors do.

Designing a Customer-Driven

Marketing Strategy

ProfitthroughCustomer

Satisfaction

IntegratedMarketing

CustomerNeeds

Market

Staring

Point Focus Means Ends

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Societal marketing concept is the idea that a

company should make good marketing

decisions by considering consumers wants,

the companys requirements, consumers long-

term interests, and societys long-run interests

Designing a Customer-Driven

Marketing Strategy

 Societalmarketing

concept

Society

(Human Welfare)

Company

(Profit)

Consumers

(Want Satisfactions)

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The marketing mix is the set of tools (four Ps) the

firm uses to implement its marketing strategy. It

includes product, price, promotion, and place.

Integrated marketing program is a comprehensive

plan that communicates and delivers the intended

value to chosen customers.

Preparing an Integrated Marketing

Plan and Program

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Building Customer Relationships

The overall process of building and maintaining

profitable customer relationships by delivering

superior customer value and satisfaction.

Customer Relationship Management

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Building Customer Relationships

Relationship Building Blocks: Customer Value and

Satisfaction

 Customer-perceived value

The differencebetween totalcustomer valueand totalcustomer cost

 Customersatisfaction

The extent towhich a product¶sperceivedperformancematches abuyer¶sexpectations

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Building Customer Relationships

BasicRelationships

FullPartnerships

Customer Relationship Levels and Tools

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Building Customer Relationships

Relating with more carefully selected

customers uses selective relationshipmanagement to target fewer, more profitablecustomers

Relating more deeply and interactively by

incorporating more interactive two wayrelationships through blogs, Websites, onlinecommunities and social networks

The Changing Nature of Customer Relationships

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Partner relationship management involvesworking closely with partners in other company

departments and outside the company to

 jointly bring greater value to customers.

Building Customer Relationships

Partners inside the company is every function

area interacting with customers

Electronically

Cross-functional teams

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Partners outside the company is how marketers

connect with their suppliers, channel partners,

and competitors by developing partnerships

Supply chain is a channel that stretches from raw

materials to components to final products to

final buyers

Supply managementStrategic partners

Strategic alliances

Building Customer Relationships

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Capturing Value from Customers

Creating Customer Loyalty and Retention

Share of Market and Share of Customers

Customer Equity

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Capturing Value from Customers

Customer lifetime value is the value of the

entire stream of purchases that the

customer would make over a lifetime of 

patronage.

Creating Customer Loyalty and Retention

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Share of customer is the portion of the

customers purchasing that a company

gets in its product categories.

Growing Share of Customer

Capturing Value from Customers

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Customer equity is the total combinedcustomer lifetime values of all of the

companys customers

Building the right relationships with the right

customers involves treating customers as

assets that need to be managed and

maximized

Capturing Value from Customers

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Capturing Value from Customers

Different types of customers require differentrelationship management strategies. Build the

right relationship with the right customers

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The Changing Marketing

Landscape

Digital ageRapid

globalization

Ethics andsocial

responsibility

Not-for-profitmarketing

Major Developments

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Digital Age

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Rapid Globalization

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Ethics and Social Responsibility

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Not-for-profit

marketing

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The Expanded Model of the Marketing Process

 Harnessmarketingtechnology

 Manage globalmarkets

 Ensure ethical& social

responsibility

 Capture valuefrom customers tocreate profits & customer equity

 Create satisfied,loyal customers

 Capture customerlifetime value

 Increase share of 

market & share of customer

 Understand themarketplace & 

customer needs & wants

 Research customers & the marketplaces

 Manage marketinginformation & customer data

 Design a customer-

driven marketingstrategy

 Select customers toserve: market

segmentation & targeting

 Decide on a valueproposition

differentiation & positioning

 Construct anintegrated

marketing programthat deliversuperior value

 Product & Servicedesign: build strong

brand

 Pricing: create realvalue

 Distribution: managedemand & supply

chains

 Promotion:communicate the

value proposition

 Build profitablerelationship & 

create customerdelight

 Customer relationshipmanagement: buildstrong relationships

with chosen customer

 Partner relationshipmanagement: buildstrong relation withmarketing partners

Create value for customer & build customer relationships Capture value from

customers in return

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