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1、Marketing: Managing Profitable Customer RelationshipsChapter 11ObjectivesBe able to define marketing and discuss its core concepts.Be able to define marketing management and compare the five marketing management orientations.ObjectivesUnderstand customer relationship management and strategies.Realiz
2、e the major challenges facing marketers in the new “connected millennium.Strong sales, no profitsCustomer-driven to its coreEach customers experience is uniqueProvides great selection, good value, discovery and convenienceA true online communityAmazon Discussion: Will Amazon Survive?Case StudyWhat i
3、s Marketing?Marketing is managing profitable customer relationshipsAttracting new customersRetaining and growing current customers“Marketing is NOT synonymous with “sales or “advertisingWhat is Marketing?Kotlers social definition: “Marketing is a social and managerial process by which individuals an
4、d groups obtain what they need and want through creating and exchanging products and value with others.GoodsServicesExperiencesEventsPersonsPlacesPropertiesOrganizationsInformationIdeasMany Things Can Be Marketed!What is Marketing?Needs, wants, and demandsMarketing offers: including products, servic
5、es and experiencesValue and satisfaction Exchange, transactions and relationships MarketsCore Marketing ConceptsWhat is Marketing?Marketing ManagementMarketing management is “the art and science of choosing target markets and building profitable relationships with them.Creating, delivering and commu
6、nicating superior customer value is key.Marketing ManagementCustomer Management:Marketers select customers that can be served well and profitably.Demand Management:Marketers must deal with different demand states ranging from no demand to too much demand.Marketing ManagementProduction conceptProduct
7、 conceptSelling concept Marketing concept Societal marketing conceptManagement OrientationsMarketing ManagementCRMCRM Customer relationship management . . .“is the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.CRM
8、It costs 5 to 10 times MORE to attract a new customer than it does to keep a current customer satisfied.Marketers must be concerned with the lifetime value of the customer.CRMAttracting, retaining and growing customersBuilding customer relationships and customer equityCustomer value/satisfactionPerc
9、eptions are keyMeeting/exceeding expectations creates satisfactionLoyalty and retentionBenefits of loyalty Loyalty increases as satisfaction levels increaseDelighting consumers should be the goalGrowing share of customerCross-sellingKey ConceptsCRMCustomer equityThe total combined customer lifetime
10、values of all customers.Measures a firms performance, but in a manner that looks to the future.Key ConceptsAttracting, retaining and growing customersBuilding customer relationships and customer equityCRMCustomer relationship levels and toolsTarget market typically dictates type of relationshipBasic
11、 relationshipsFull relationshipsCustomer loyalty and retention programsAdding financial benefitsAdding social benefitsAdding structural tiesAttracting, retaining and growing customersBuilding customer relationships and customer equityKey ConceptsMarketing ChallengesTechnological advances, rapid glob
12、alization, and continuing social and economic shifts are causing marketplace changes.Major marketing developments can be grouped under the theme of Connecting.Marketing ChallengesVia technologyWith customersWith marketing partnersWith the worldAdvances in computers, telecommunications, video-confere
13、ncing, etc. are major forces.Databases allow for customization of products, messages and analysis of needs.The InternetFacilitates anytime, anywhere connectionsFacilitates CRMCreates marketspacesConnectingMarketing ChallengesSelective relationship management is key.Customer profitability analysis se
14、parates winners from losers.Growing “share of customer Cross-selling and up-selling are helpful.Direct sales to buyers are growing.ConnectingVia technologyWith customersWith marketing partnersWith the worldMarketing ChallengesPartner relationship management involves:Connecting inside the companyConn
15、ecting with outside partnersSupply chain managementStrategic alliancesConnectingVia technologyWith customersWith marketing partnersWith the worldMarketing ChallengesGlobalizationCompetitionNew opportunitiesGreater concern for environmental and social responsibilityIncreased marketing by nonprofit an
16、d public-sector entitiesSocial marketing campaignsConnectingVia technologyWith customersWith marketing partnersWith the worldCompany and Marketing Strategy: Partnering to Build Customer RelationshipsChapter 222ObjectivesUnderstand company-wide strategic planning and its four steps.Learn how to desig
17、n business portfolios and develop strategies for growth and downsizing.Understand marketings role in strategic planning and how marketers partner with others.ObjectivesBe able to describe the marketing process and the forces that influence it.Learn the marketing management functions, including the e
18、lements of the marketing plan.Case StudyKnown for films, animation, theme parks and customer orientationParks offer a variety of attractions as well as cleanliness, order, and warmthSatisfying the customer is everyones jobDisney has grown via diversificationSales and net income have fallen Walt Disn
19、ey CompanyDiscussion: How Can Disney Recover?Strategic PlanningStrategic planning is defined as:“The process of developing and maintaining a strategic fit between the organizations goals and capabilities and its changing marketing opportunities.Strategic PlanningPlanning activities occur at the busi
20、ness unit, product, and market levels, and include:Defining the purpose and missionSetting objectives and goalsDesigning the business portfolioDeveloping detailed marketing and departmental plansStrategic PlanningMission statements should . . .serve as a guide for what the organization wants to acco
21、mplish.be “market-oriented rather than “product-oriented.be neither too narrow, nor too broad.fit with the market environment.be motivating.Strategic PlanningMission statements guide the development of objectives and goals.Objectives are developed at each level in the organization hierarchy.Strategi
22、es are developed to accomplish these objectives.Strategic PlanningBusiness portfolio: “the collection of businesses and products that make up the company.Designing the business portfolio is a key element of the strategic planning process.Strategic PlanningStep 1: Analyze the current business portfol
23、ioStep 2: Shape the future business portfolioIdentify strategic business units (SBUs)Assess each SBU:The BCG growth-share matrix classifies SBUs into one of four categories using the:Market growth rate SBUs relative market share within the market.Portfolio DesignBCG Growth-Share MatrixStrategic Plan
24、ningHigh RelativeMarket ShareHigh Market GrowthLow Market GrowthStarsCash CowsQuestion MarksDogsLow RelativeMarket ShareStrategic PlanningStep 1: Analyze the current business portfolioStep 2: Shape the future business portfolioDetermine the future role of each SBU and choose the appropriate resource
25、 allocation strategy:BuildHoldHarvestDivestSBUs change positions over timePortfolio DesignStrategic PlanningMatrix approaches to formal planning share many problems:Difficult, time-consuming, and costly to implement.Focus only on current businesses.Too strongly emphasize market share growth or growt
26、h via diversification.Strategic PlanningDesigning the business portfolio also involves:Developing strategies for growth by identifying, evaluating, and selecting promising new market opportunities. Product/market expansion gridDeveloping strategies for downsizing the business portfolio.Product/Marke
27、t Expansion GridStrategic PlanningExisting ProductsNew ProductsExisting MarketsNew MarketsMarket PenetrationMarket DevelopmentProduct DevelopmentDiversificationPlanning MarketingMarketing plays a key role in the strategic planning process.Marketers must practice CRM and Partner Relationship Manageme
28、nt.Partnering with other departments in the company as well as other firms in the marketing system helps to build a superior value delivery-network.The Marketing ProcessThe strategic planning and business portfolio analysis processes help to identify and evaluate marketing opportunities.The purpose
29、of the marketing process is to help the firm plan how to capitalize on these opportunities. Analyzing marketing opportunitiesSelecting target marketsDeveloping the marketing mixManaging the marketing effortKey ElementsThe Marketing ProcessThe segmentation process divides the total market into market
30、 segments.Target marketing determines which segment(s) are pursued.The market positioning for the product is then determined.Analyzing marketing opportunitiesSelecting target marketsDeveloping the marketing mixManaging the marketing effortKey ElementsThe Marketing ProcessCompetitor analysis guides c
31、ompetitive marketing strategy development.Strategy leads to tactics by way of the marketing mix: The “Four Ps product, price, place, promotion (seller viewpoint)The “Four Cs customer solution, cost, convenience, and communication (customer viewpoint)Analyzing marketing opportunitiesSelecting target
32、marketsDeveloping the marketing mixManaging the marketing effortKey ElementsThe Marketing ProcessMarketing analysisProvides information helpful in planning, implementation, and controlMarketing planningStrategies and tacticsMarketing implementationTurns plans into actionMarketing controlOperating co
33、ntrolStrategic controlMarketing auditAnalyzing marketing opportunitiesSelecting target marketsDeveloping the marketing mixManaging the marketing effortKey ElementsMarketing in the Digital Age: Making New Customer ConnectionsChapter 342ObjectivesBe able to identify the major forces shaping the new di
34、gital age.Understand how companies have responded to the Internet with e-business strategies.Be able to describe the four major e-commerce domains.ObjectivesUnderstand how companies use e-commerce to profitably deliver greater value to customers.Realize the promise and challenges that e-commerce pre
35、sents for the future.Invented discount brokerage categoryFirst U.S. major player to go onlineInitially offered two-tiered trading system to protect profits / stop cannibalizationLater became first true click-and-mortar full-service brokerage Now worlds largest e-commerce site 85% online trades; 21%
36、of trade volume; Strong stock returnCharles SchwabCase StudyMajor Forces Shaping the Digital AgeDigitalization and ConnectivityThe flow of digital information requires connectivity Intranets, Extranets, and the Internet The Internet ExplosionKey driver of the “new economyNew Types of IntermediariesB
37、rick-and-mortar firms often face disintermediation from click-only competitorsThe click-and-mortar business model has been highly successfulCustomization and CustomerizationMajor Forces Shaping the Digital AgeMarketing Strategy in the Digital AgeE-business: uses electronic means and platforms to con
38、duct business.E-commerce:facilitates the sale of products and services by electronic means. Marketing Strategy in the Digital AgeE-marketing: Includes efforts that inform, communicate, promote, and sell products and services over the Internet.E-commerce benefits both buyers and sellers Marketing Str
39、ategy in the Digital AgeBuyer Benefits of E-Commerce: ConvenienceEasy and privateGreater product access/selectionAccess to comparative information Interactive and immediateMarketing Strategy in the Digital AgeSeller Benefits of E-Commerce: Relationship buildingReduced costsIncreased speed and effici
40、encyFlexibilityGlobal access, global reachE-Marketing DomainsE-Commerce DomainsTargeted to consumersInitiated by businessesB2CTargeted to businessesInitiated by consumersC2CC2BB2BE-Commerce Domains B2C B2B C2C C2BOnline consumersNow more mainstream and diverseHas created new targeting opportunitiesO
41、nline behavior differs by ageOnline consumers differ from traditional off-line consumersThey initiate and control the exchange process Value information highlyMajor DomainsE-Commerce Domains B2C B2B C2C C2BB2B sales far exceed B2C salesB2B sales are estimated to reach $4.3 trillion in 2005Open tradi
42、ng networksE-marketspace bringing sellers and buyers togetherPrivate trading networksLinks sellers with their own trading partnersMajor DomainsE-Commerce Domains B2C B2B C2C C2BC2C web sites help consumers exchange goods or informationeBay is one exampleAuction sites facilitate the exchange processA
43、llow access to a much larger audienceNewsgroups / forums Help consumers to find and share informationMajor DomainsE-Commerce Domains B2C B2B C2C C2BAllow consumers to search out sellers, learn about offers, initiate purchase, or dictate purchase termsEx: Priceline Some sites facilitate the feedback
44、process between customers and companiesEx: Planetfeed Major DomainsConducting E-CommerceClick-Only-CompetitorsE-tailers, search engines and portals, ISPs, transaction sites, enabler sitesDot s failed for many reasonsLack of planning and researchOver emphasis on acquisition vs. retentionPoor web site
45、 design / distribution systemsLow marginsConducting E-CommerceClick-and-Mortar CompaniesChannel conflict was initially a concern E-commerce often created new customers, rather than cannibalizing existing onesMany firms now enjoy greater success than their click-only competitionTrusted brand names, g
46、reater financial resources, larger customer base, industry knowledge, and strong supplier relationships were key advantagesConducting E-CommerceCorporate web sitesBuild goodwill and relationships; generate excitementMarketing web sitesEngage consumers and attempt to influence purchaseWeb site design
47、7 Cs of effective web site designE-MarketingCreating web sitesPlacing online ads and promotionsCreating or using web communitiesUsing E-mail and webcastingSeven Cs of Web Site DesignConducting E-CommerceContextContentCommunityCommunicationConnectionCommerceCustomizationConducting E-CommerceOnline fo
48、rms of ads and promotionsBanner ads/tickersSkyscrapersInterstitialsBrowser adsContent sponsorshipsMicrositesViral marketingFuture of online adsE-MarketingCreating web sitesPlacing online ads and promotionsCreating or using web communitiesUsing E-mail and webcastingConducting E-CommerceWeb communitie
49、s allow members with special interests to exchange viewsSocial communitiesWork-related communitiesMarketers find well-defined demographics and shared interests useful when marketingE-MarketingCreating web sitesPlacing on-line ads and promotionsCreating or using web communitiesUsing E-mail and webcas
50、tingConducting E-CommerceE-mail marketingKey tool for B2B and B2C marketingClutter is a problemEnriched forms ofe-mail attempt to break through clutterWebcastingAuto downloading of customized content to recipients PCsE-MarketingCreating web sitesPlacing on-line ads and promotionsCreating or using we
51、b communitiesUsing E-mail and webcastingPromise and Challenges of E-CommerceThe Promise of E-CommerceThe future of B2B E-commerce is brightA few click-only companies may succeedMost companies will integrate online marketing into the marketing mixPromise and Challenges of E-CommerceChallenges: The We
52、bs Darker SideFew B2C companies are profitable Limited exposure, skewed demographics Navigating the web is often problematicChallenge: Legal and Ethical IssuesOnline privacy and security concernsInternet fraud, the digital divide, access by vulnerable or unauthorized groupsThe MarketingEnvironmentCh
53、apter 466ObjectivesKnow the environmental forces that affect the companys ability to serve its customers.Realize how changes in the demographic and economic environments affect marketing decisions. ObjectivesIdentify the major trends in the firms natural and technological environments.Know the key c
54、hanges in the political and cultural environments.Understand how companies can react to the marketing environment.Case Study“Millennial fever set the stage to bring back the BeetleVWs investment: $ 560 million Demand quickly outstripped supplyThe new VW beetle enjoyed cross-generational appealEarned
55、 many awardsBeetle now accounts for over 25% of company salesVolkswagenDiscussion: Will the flower-power Microbus succeed next?Key EnvironmentsMarketing EnvironmentThe actors and forces that affect a firms ability to build and maintain successful relationships with customers.Aspects of the marketing
56、 environment: Microenvironment MacroenvironmentActors Affecting a Firms Ability to Serve CustomersThe MicroenvironmentCompanySuppliersCustomer MarketsCompetitorsPublicsMarketing IntermediariesThe MicroenvironmentDepartments within the company impact marketing planning.Suppliers help create and deliv
57、er customer value.Treat suppliers as partners.Marketing intermediaries help sell, promote, and distribute goods.Intermediaries take many forms.The MacroenvironmentCustomer markets must be studied.Consumer, business, government, reseller and international markets exist.Successful companies provide be
58、tter customer value than the competition.Size and industry position help to determine the appropriate competitive strategy.Various publics must also be considered.Types of PublicsThe MicroenvironmentFinancialMediaGovernmentLocalGeneralInternal Citizen ActionMacroenvironmental ForcesThe Macroenvironm
59、entDemographicEconomicNaturalTechnologicalPoliticalCulturalThe MacroenvironmentKey Demographic TrendsWorld population growthChanging age structure The U.S. population consists of seven generational groups.Baby boomers, Generation X, and Generation Y are key groups. Distinct segments typically exist
60、within these generational groups.The MacroenvironmentBorn between 1946 and 1964Represent 28% of the population; earn 50% of personal incomeMany mini-segments exist within the boomer groupEntering peak earning years as they matureLucrative market for travel, entertainment, housing, and moreBaby Boome
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