The Marketing Concept

Evolving Perspectives

What Is Marketing?

Simple Definition: Marketing is managing profitable customer relationships.

Goals:

1. Attract new customers by promising superior value.

2. Keep and grow current customers by delivering satisfaction.

Marketing Management Philosophies

Production Concept

Product Concept

Selling Concept

Marketing Concept

Societal Marketing Concept

The Production Concept

The Product Concept

Marketing and Sales Concepts Contrasted

Societal Marketing Concept

This Is a Need

Needs - state of felt

deprivation

including physical,

social, and

individual needs.

Maslow’s

Hierarchy

of Needs

This Is a Want

Wants - form that

a human need

takes, as

shaped by

culture and

individual

personality.

Need / Want Fulfillment

Needs and Wants

Fulfilled through a

Marketing Offer :

Some combination of

products, services,

information, or

experiences offered to a

market to satisfy a need

or want.

Products Anything that can be Offered to a Market to Satisfy a Need or Want

Persons Places Organizations

Ideas Information

What Satisfies Consumers’

Needs and Wants?

Services Activity or Benefit Offered for Sale That is Essentially

Intangible and Does Not Result in the Ownership of Anything

Marketing Myopia

Sellers pay more

attention to the specific

products they offer than

to the benefits and

experiences produced

by the products.

They focus on the

“wants” and lose sight

of the “needs.”

This Is Demand

“Demand”

Wants Buying Power

What is a Market?

The set of actual

and potential buyers

of a product.

These people share

a need or want that

can be satisfied

through exchange

relationships.

Segmentation and Target Marketing

Market Segmentation:

Divide the market into segments of customers

Target Marketing:

Select the segment to cultivate

#1 #2

Customer Satisfaction

Dependent on the

product’s perceived

performance relative

to a buyer’s

expectations.

Value and Satisfaction

Expectation Performance

8 10

If performance is lower than expectations, satisfaction is low.

If performance is higher than expectations, satisfaction is high.

Expectation Performance

10 8

Customer Perceived Value

Customer’s evaluation

of the difference

between all the

benefits and all the

costs of a marketing

offer relative to those

of competing offers.

Customer Relationship Levels

Basic Relationship

Full Partnership

Continuum

Loyalty and Retention

Financial Benefits

Social Benefits

Structural Ties

Customer Relationship Management

The process of

building and

maintaining

profitable customer

relationships by

delivering superior

customer value and

satisfaction.

Customer Lifetime Value

The entire stream of

purchases that the customer

would make over a lifetime of

patronage.

Share of Customer

The share a company

gets of the customers

purchasing in their

product categories.

Customer Loyalty & Retention