marketing intro_web

8/7/2019 marketing intro_web

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A Brief Introduction to

Marketing and Customer

Relationship Building

Jeremy Kees, Ph.D.


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Who is Jeremy Kees??


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CONSUMER


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American Marketing AssociationsAmerican Marketing Associationsnew official definition of marketing

released August 2007:

Marketing is the activity, set of

institutions, and processes for

creating, communicating, delivering,

and exchanging offerings that have

value for customers, clients, partners,

and society at large.


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KotlerKotler & Kellers& Kellers definition ofmarketing management:

The art and science of choosing

target markets and getting, keeping,

and growing customers through

creating, delivering, and

communicating superior customer

value.


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Value, Value, Value

Successful products and servicesdeliver value and satisfaction to

customers

We make buying decisions based onwhich product is perceived to offer

the most value

Tangible/Intangible benefits vs. cost


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How do we create customers?

Identifying customerneeds Designinggoods and services that meet

those needs

Communicate Information about thosegoods and services to prospective buyers

Making the goods or services available attimes and places that meet customers needs

Pricinggoods and services to reflect costs,competition, and customers ability to buy

Providing for the necessary service andfollow-up


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How do we create VALUE?

Identify the needs in the marketplace

Find out which needs the organization can

profitably serve

Designgoods and services that meet those

needs Developing a marketing mix that will convert

potential customers into actual customers

Providing for the necessary service and follow-

up after the service


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4 Eras of Marketing


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From transaction-based marketing to

relationship marketing

Transactionbased marketing(Simple exchanges)

Relationship marketing

Lifetime value of a customer

Convertingnew customers to

advocates


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From transaction-based marketing to

relationship marketing


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Transaction vs. Relationship

Marketing


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Three Levels of Relationship Marketing

Characteristic Level 1 Level 2 Level 3

Primary bond Financial Social Structural

Degree of

customization

Low Medium Medium to high

Potential forsustained

competitive

advantage

Low Moderate High


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Lets take a step back

Although it is very important to tryto build relationships with

customers to ensure LT success

But, it is just as important todetermine which consumers we

want this relationship with!!

Target Market

Costly Consumers

Sprint Video


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Customer Relationship

Management (CRM)

The combination of strategies and tools

that drive relationship programs, re-

orientating the entire organization to a

concentrated focus on satisfying

customers


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Strategies for Building

Customer Relationships

Affinity Programs a marketing effort sponsored by an

organization that solicits responses

from individuals who share common

interests and activities

BOA


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Frequency Marketing

frequent-buyer or user marketing

programs that reward customers with

cash, rebates, merchandise, or other

premiums

Examples??

Thankyou Rewards Spot

But not just for hotels and

airlines


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Database Marketing software that analyzes marketing

information, then identifies and

targets messages toward specific

groups of potential customers

http://www.wyndham.com


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Strategies for Building B2B

Relationships

Strategic alliance a partnership formed to create a

competitive advantage

These more formal long-term

partnership arrangements improvedeach partner supply-chainrelationships and enhance flexibility

Wal-Mart!


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Relationships

Electronic Data Interchange (EDI) involves computer-to-computer

exchanges of invoices, orders, and

other business documents

Vendor Managed Inventory (VMI)

is an inventory-management system

in which the sellerbased on existing

agreement with a buyer determineshow much of a product is needed


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Relationships

Database Marketing software that analyzes marketing

information, then identifies and

targets messages toward specific

groups of potential customers


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Evaluating Relationships

Lifetime Value (LTV)

Refers to the net present value of thepotential revenue stream for any particularcustomer over a # of years

Starts with current purchase activity thenextrapolates to include potential additionsfrom cross-selling, upgrades, totalownership, etc.


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Marketing Concept

Based on ConsumerOrientation 100% focus toward the consumer

Consumer drives company-wide

decisions Focused onLONG TERM success


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Building Buyer-Seller

Relationships

Many customers are seeking ways to simplifytheir lives, and relationships provide a way todo this

Customers find comfort with brands that havebecome familiar through their ongoing

relationships with companies or when they feellike they can relate to a company

Doves Campaign for REALBeauty

Evolution

Such relationships often lead to more efficient

decision-making my customers and higherlevels of customer satisfaction


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The Value of Customer Retention

On average, it costs over 10TIMES more to acquire a new

customer versus retain an existing

one A 5% gain in customer retention

can result in an 80% gain in

profits.

marketing intro_web

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