Chapter 1: Managing Profitable

Customer Relationships

What is Marketing?

Marketing, more than any other business deals with customers. It is the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return.

Understanding the Marketplace and Customer Needs:

Needs: states of felt deprivation

Wants: the form human needs take when they are framed by culture and individual personality.

Demands: human wants that are backed by buying power.

Market offering: some combination of products, services, information, or experiences offered to a market to satisfy a need or a want.

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.

Exchange: the act of obtaining a desired object from someone by offering something in return.

Market: the set of all actual and potential buyers of a product pr service.

Defining customer need:

Designing a Customer-Driven Marketing Strategy :

Marketing management: is the art and science of choosing target markets and building profitable customer relationships.

The company must first decide who it will serve. It does this by dividing the market into segments of customers(market segmentation) and selecting which segment it will go after(target marketing).

Choosing a value proposition:

The company must also decide how it will serve targeted customers , and how it will differentiate and position itself in the marketplace. A company's value proposition is the set of benefits  or values it promises to deliver to consumers to satisfy their needs.

Marketing Management Orientations: The Production Concept, The Product Concept, The Selling Concept, The Marketing Concept, The Societal Marketing Concept.

Preparing an Integrated Marketing Plan and Program:

The major markeitng mix tools are classified into four broad groups, called the 4 P's of marketing: product, price, place and promotion. To deliver on its value proposition, the firm must first choose a need-satisfying market offering(product).

Building customer relationships

Customer relationship management: is the most important concept of modern marketing. It is the overall process of building and maintaining profitable cusomer relationships by delivering superior cusomer value and satisfaction.

Customer perceived value: is the customer's valuation of the difference between all the costs of a market offering relative to those of competing offers.

Customer satisfaction: is the extent to which a product's perceived performance matches a buyer's expectations.


Customer Relationship Management


Capturing Value from Customers

Capturing customer value from typical customers comes throught three steps: Creating customer loyalty and retention, growing share of customer, and Building Customer Equity . The first way encompasses an out-shining concept, CUSTOMER LIFETIME VALUE, which states the value of the entire stream of purchases that a customer would make over a lifetime of patronage.

On the other hand a share of customer is the portion of the customer's purchasing that a company gets in its product categories.

Subsequently, Building Customer Equity is the building of the total combined customer lifetime values of all of the company's customers.

Chapter 5: Consumer Markets 

and Consumer Buyer Behaviour