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c 




 
is a process by which companies create value for customers and build strong customer
relationships to capture value from customers in return.

 
   
 


Once the company or an organization has created value for the customer then they try to capture value
from the customers in the form of profits, sales and long-term customer equity.

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customer relationship. customers

understand build capture value


design a construct a
the market profitable from the
customer- marketing
place and the relationships customers to
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customer and create create profits
marketing delivers
needs and customer and customer
strategy superior value
wants. dekight equity

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Πcore customer and market place concepts:

I. Needs, wants and demands.


II. Market offerings (product services and experience).
III. Value and satisfaction.
IV. Exchanges and relationships.
V. Markets.


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 $ Basic concept underlying marketing is that of human needs. Human needs are states of
deprivation. They include:

1. Physical needs- food, clothing, warmth and safety.


2. Individual- needs for knowledge and self expression.
3. Social- belonging and affection.

Example thirst or hunger is our physical need.

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: Form that needs take shaped by culture and individual personality.

Example water and food would be our want. Example for a Pakistani it would be water and for an
American, want to satisfy his thirst need could be beer.

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$they are wants backed by buying power.

Example the want being water could either be of normal ground water or mineral water depending on
your buying power.

,* !))#$Consumer needs and wants are satisfied through market offerings. They
are combination of products, services, experiences or information. They are not only limited to
physical products but also include services- activities or benefits that are essentially intangible
and do not result in the ownership of anything but experiences. Example of experiences would
be tourism, air travel, hotel stays and banking. More broadly it also includes other entities
information, place, organization or ideas. Example is of dawn news; they don͛t only promote its
television news channel but also markets the idea that enlightened state needs good
governance. So the market offering the society is not a simple news channel but the cause of
good governance. Also the awareness programs marketing their ideas for eradicating highly
infectious diseases like POLIO and AIDS.

 -! $Is focusing only on existing wants and losing sight of underlying consumer
needs. The mistake of paying more attention to the specific product the company offers than to
the benefit and experiences produced by these products. Example will be of Kodak, it mainly
failed because it did not focus on the customer needs of wanting updated cameras and kept
making the obsolete roll films for cameras instead of switching to the new technology of digital
cameras. Whereas Sony updated its technology and came up with better good digital cameras
and customers automatically got attracted to them and wanted them as it satisfied their needs
better. The customer had the same „  but „  the new product.
* "G#! .(G'##)"!$They are the building blocks for managing and
developing customer relation. Customers come across a wide variety and range of products that
can satisfy their needs. They choose from this variety according to the experience they get after
usage of the product. A dissatisfied customer will switch to a competitor and disparage the
product to others. A satisfied customer buys again and tells other about his good experience.
Marketers must be careful to set the right level of expectations. If they set them too low, they
may satisfy those who buy it but fail to attract enough buyers. If they set them too high buyers
will be disappointed.

* /"#'(!# #$ is the act of obtaining a desired object from someone by
offering something in return. The marketer tries to bring about a response to some market
offering. Marketing consists of action taken to build and maintain desirable exchange
relationships with target audiences involving a product, service, idea or other object. Beyond
attracting new customers and creating transactions, the goal is to retain customers and grow
their business with the company.

e) : arethe set of actual and potential buyers of a product. Marketing is managing markets
by building strong customer relationships. Creating these relationships takes works. Sellers must
identify their buyers, need to identify their needs, design good market offerings, set prices for
them, promote them, store them and deliver them. Buyers also carry on their marketing by
searching for the products and interacting with companies and obtain information and make
purchases.
Marketing involves serving a market of final consumers in the face of competitors. The company
and competitors research the market and interact with consumer to understand their needs.
Then they create and send their market offering and messages to consumers directly or through
marketing intermediaries. All of the parties in the system are affected by environmental factors.





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   can design a customer-driven marketing strategy. Marketing
management is the art and the science of choosing target markets and building profitable
relationships with them.

Two fundamental questions to design a winning marketing strategy:


 What customers will we serve? (Target market).
 How can we best serve these customers? (Value propositions).

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Company finds out who it will serve by the market into segments called # !
and then selecting which segment to go for this is  . Marketing managers know
that they cannot serve all the customers in every way because trying to serve all customers they
might not have any customers.

Some marketers may even seek fewer customers and reduced demand. For example, amusements
parks are overcrowded in the summer and many power companies have trouble meeting demand
during peak usage periods. In these cases and other cases of excess demand, companies may
practice '  to reduce the number of customers or to shift their demand temporarily or
permanently. The aim is not to destroy demand but to reduce or shift it.

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The company must decide how it will serve the targeted customers. How will it differentiate and
position itself in the market.
  
is the set of benefits or values a company promises to deliver to
customers to satisfy their needs. They differentiate one brand from another.

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Five alternative concepts under which organizations design carry out their marketing strategies:

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Is the idea that consumers will favor products that are available and highly affordable. Therefore
management should focus on improving production and distribution efficiency. This can lead to
market myopia as some companies might run a major risk of concentrating solely on their
operations and losing sight of real objective- satisfying customer needs and building customer
relationships. China market makes such products and in it the cost of production is reduced.

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Is the idea that consumers will favor products that offer the most quality, performance, and
innovative features. Organization should therefore devote its energy to making continuous
product improvements. This might also lead to market myopia. Example of the mouse trap how
customers are not really looking for a better mouse trap but a good alternative solution to kill
mouse. This concept works for companies which have no product substitute.

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Is the idea that consumers will not buy enough of the firm͛s products unless it undertakes a
large scale selling and promotion effort. It is practiced with unsought goods- those that buyers
do not normally think of buying, such as insurance and blood donation. Such aggressive selling is
however risky as it concentrates on creating sales and not building long profitable customer
relationships.

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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. Under this
concept customer focus is the path to sales and profits. Instead of being product centered it is
customer centered. The job is not to find the right customer for your product but finding the
right product for your customer.
Customer driven marketing: it works when a clear need exists and when customers know what
they want.
Customer driving marketing: in many cases customers don͛t know what they want. Like 20 years
ago no on would have thought to ask for now common place products such as cell phones,
iPods, digital cameras and so on. So customer driving marketing is understanding customer
needs even better than the customers themselves do and creating products and services that
meet existing and latent needs, now and in the future.

WHAT IS THE DIFFERERENCE BETWEEN SELLING AND MARKETING CONCEPT?


Answer: Selling concept takes an inside-out perspective. It starts with the factory, focuses on
company͛s existing products, and calls for heavy selling and promotion to obtain profitable
sales. It focuses primarily on customer conquest- getting short term sales with little concern
about who buys or why.
Marketing concept takes an outside-in perspective. It starts with well defined market, focuses
on consumer needs, and integrates all the marketing activities that affect customers. In turn it
yields profit by creating lasting relationships with the right customers based on customer value
and satisfaction.

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Is the idea that a company should make good marketing decisions by considering consumer͛s
wants, the company͛s requirements, consumers͛ long-term interests, and society͛s long-run
interests.
It questions whether the pure marketing concept overlooks possible conflicts between
consumer short-term wants and consumer long-run welfare. It holds that marketing strategy
should deliver value to customers in such a way that maintains or improves both the consumer͛s
and society͛s well being.
Example is of today͛s flourishing bottled water industry. You may view bottles water companies
as offering convenient, tasty, and healthy product. Its packaging suggests green images of
pristine lakes and snow capped mountains but in reality manufacturing these bottles emits large
amounts of CO2 that contributes to global warming.
Now companies should balance 3 considerations in setting their manufacturing strategies
- Company profit
- Consumer wants
- Society͛s interest