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Transcript of 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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Strategies for Building
Customer Relationships
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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Strategies for Building
Customer Relationships
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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Strategies for Building B2B
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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Strategies for Building B2B
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.