The LOGIC of Market/Customer Orientation Chapter 1 An Overview of Marketing The LOGIC of Market/Customer Orientation for the Business Purpose of Marketing Sales vs. Market Orientations Sales Orientation Market Orientation Organization’s Focus Firm’s Business For Whom? Primary Profit Goal? Tools to Achieve Selling goods and services Everybody Maximum sales volume Primarily promotion Inward Outward Coordinated use of all marketing activities Customer satisfaction Specific groups of people Satisfying wants and needs NOTES: 1) sales-oriented firms focus on their own needs; market-oriented firms focus on customers’ needs and preferences. 2) sales-oriented companies consider themselves to be deliverers of goods and services, whereas market-oriented companies view themselves as satisfiers of customers. 3) sales-oriented firms direct their products to everyone; market-oriented firms aim at specific segments of the population. 4) although the primary goal of both types of firms is profit, sales-oriented businesses pursue maximum sales volume through intensive promotion, whereas market-oriented businesses pursue customer satisfaction through coordinated activities. This comparison is not meant to belittle the role of promotion, especially personal selling, in the marketing mix. Salespeople in market-oriented organizations are generally perceived as problem solvers and links to supply sources and new products. Discussion/Team Activity: Identify organizations with sales or market orientations. Discuss the effectiveness of each organization’s strategy.

Customer Orientation (Satisfaction) The Marketing Concept [Perreault and McCarthy -- Essentials of Marketing. NY: McGraw-Hill.] This slide relates to material on pp. 16-18. : Indicates place where slide “builds” to include the corresponding point. Customer Orientation (Satisfaction) Goal Orientation (Profit) Summary Overview The cornerstone of the marketing-oriented company is the marketing concept. Key Issues Production orientation--making whatever products are easy to produce and then trying to sell them. Marketing orientation--designing marketing programs that will meet customer needs. Marketing concept: customer satisfaction guides the whole organization; all individuals work together to accomplish this goal Discussion Question: What can managers do to motivate everyone in the organization to satisfy customer needs? requires that the company be profitable. The Marketing Concept : : Total Company Effort (“Synergy/Value”) : Copyright © 1999 by Thomas Southwestern. All rights reserved.

Putting It All Together [Perreault and McCarthy -- Essentials of Marketing. NY: McGraw-Hill.] This slide relates to material on p. 21. : Indicates place where slide “builds” to include the corresponding point. Superior Customer Value Total Company Effort to Satisfy Customers Superior Customer Value Total Company Effort to Satisfy Customers Customer Acquisition Customer Satisfaction Customer Satisfaction Customer Retention Customer Acquisition Summary Overview This model summarizes the important ideas presented to this point. Key Issues In a firm that has adopted the marketing concept, everyone focuses on customer satisfaction. The organization offers superior customer value. Value, in turn, helps attract customers and keeps them satisfied after they buy. This satisfaction then leads to repeat purchase. As the firm maintains this profitable relationship, the profit gives the firm the incentive and the resources to offer superior customer value. Discussion Question: If a firm’s customers are already satisfied with the firm’s offerings, why does the firm need to look for new and better ways to provide customer value? Adopting the marketing concept is a “win-win” situation for marketers and consumers! : Customer Retention Profitable Relationships with Customers : : : Copyright © 1999 by Thomas Southwestern. All rights reserved.

Customer Satisfaction New Product Innovation Corporate Performance Competitive Advantages Through Customer Satisfaction [Sheth, et al. -- Customer Behavior] Customer Satisfaction Repeat Buying Higher Prices Loyalty in Crisis Word of Mouth One-Stop shopping New Product Innovation Profits Corporate Performance Growth Copyright © 1999 by Thomas Southwestern. All rights reserved.

MARKETING RESEARCH: Only way to Know CUSTOMER VALUE Copyright © 1999 by Thomas Southwestern. All rights reserved.