Marketing: Creating and Capturing Customer Value Philip Kotler | Gary Armstrong | Prafulla Y. Agnihotri | Ehsan ul Haque

Opening Case Procter & Gamble Product: Tide detergent Strategy: Building customer relationship Implementation: “knows fabrics best” Result: Increase in market share, most successful detergent in the market

What is Marketing? Marketing is ‘managing profitable customer relationship’. A process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return. Why do companies invest heavily in marketing? Class activity: Write down one sentence that is your own personal slogan. The aim is to impress an employer who would employ you based on your slogan.

Wal-Mart: ‘Save money. Live better’ Disney theme park: ‘Make a dream come true today’ Apple: ‘Think different'

The Marketing Process

Understanding the Marketplace and Customer Needs Customer needs, wants and demands Market offerings - Products, services, and experiences Customer value and satisfaction Exchanges and relationships Markets

Designing a customer driven marketing strategy Selecting customers to serve Choosing a value proposition Marketing management orientations The production concept The product concept The selling concept The marketing concept The societal marketing concept

Preparing an integrated marketing program The 4 Ps: Product, Price, Place and Promotion To be discussed in detail later.

Building customer relationships Customer Relationship Management Relationship building blocks: customer value and customer satisfaction. Customer relationship levels and tools The changing nature of customer relationships Selective relationship management: Best Buy, consumer electronics; angels and demons Relating more deeply and interactively

Capturing value from customers Creating customer loyalty and retention Growing share of customers Building customer equity Customer equity: the total combined customer lifetime values of all the company’s customers. Cadillac and BMW. Building the right relationship with the right customers

The changing marketing landscape The digital age Rapid globalization The call for more ethics and social responsibility The growth of not-for-profit marketing

Home assignment Ask five businesspeople from different industries (for example, food service, retailing, consumer-product manufacturing, education and so on) what they think marketing is. Evaluate their definitions and discuss whether or not they are consistent with the goal of creating customer value and managing profitable customer relationships.