Chapter 12 1 Understanding the Customer Prepared by Norm Althouse University of Calgary Prepared by Norm Althouse University of Calgary Copyright © 2011 by Nelson Education Ltd.

Chapter 12 Learning Outcomes 2 1 Define marketing concept, and relationship marketing. 2 Show how managers create a marketing strategy. 3 Explain marketing mix. 4 Summarize how consumers and organizations make buying decisions. 5 List the five basic forms of market segmentation. 6 Identify how marketing research is used in marketing decision making. 7 List some of the trends in understanding the consumer. Copyright © 2011 by Nelson Education Ltd.

Chapter 12 Marketing—The “Right” Principle 3 Getting The “Right” Goods or Services to The “Right” People at The “Right” Place, Time, and Price using The “Right” Promotion Techniques using The “Right” Promotion Techniques Copyright © 2011 by Nelson Education Ltd.

Chapter 12 Marketing 4 The process of discovering the needs and wants of potential buyers and customers and then providing goods and services that meet or exceed their expectations. Marketing The process in which two parties give something of value to each other to satisfy their respective needs. The process in which two parties give something of value to each other to satisfy their respective needs. Exchange Copyright © 2011 by Nelson Education Ltd.

Chapter 12 The Marketing Concept Focusing on customer wants so the organization can distinguish its products from competitors’ offerings. Integrating all of the organization’s activities to satisfy these wants. Achieving long-term goals for the organization by satisfying customer wants and needs, legally and responsibly. 5 Copyright © 2011 by Nelson Education Ltd.

Chapter 12 The Marketing Concept 6 Customer Satisfaction The customer’s feeling that a product has met or exceeded expectations. Customer Value The ratio of benefits to the sacrifice necessary to obtain those benefits, as determined by the customer. The ratio of benefits to the sacrifice necessary to obtain those benefits, as determined by the customer. Building Relationships A strategy that focuses on forging long-term partnerships with customers by offering value and providing customer satisfaction. Copyright © 2011 by Nelson Education Ltd.

Chapter 12 Creating a Marketing Strategy 7 1.Understanding the External Environment 2.Defining the Target Market 3.Creating a Competitive Advantage 4.Developing a Marketing Mix Copyright © 2011 by Nelson Education Ltd.

Chapter 12 The External Environment 8 Environmental Scanning Demographic Forces Economic Forces Technological Forces Political & Legal Forces Competitive Forces Social Forces Copyright © 2011 by Nelson Education Ltd.

Chapter 12 The Target Market 9 The specific group of consumers toward which a firm directs its marketing efforts. Target Market Copyright © 2011 by Nelson Education Ltd.

Chapter 12 Copyright © 2008 by Nelson, a division of Thomson Canada Limited10 The Product Life Cycle INTRODUCTION ACCELERATING GROWTH CONSTANT GROWTH DECLINING GROWTH DECLINE MATURITY SALES VOLUME TIME

Chapter 12 Competitive Advantage 11 Differential Competitive Advantage A firm’s ability to provide a unique product or service that offers something of value besides a lower price. A firm’s ability to provide a unique product or service that offers something of value besides a lower price. Cost Competitive Advantage Cost Competitive Advantage A firm’s ability to produce a product or service at a lower cost than its competitors. Niche Competitive Advantage Niche Competitive Advantage A firm’s ability to target and effectively serve a single segment of the market within a limited geographic area. Copyright © 2011 by Nelson Education Ltd.

Chapter 12 The Marketing Mix 12 Copyright © 2011 by Nelson Education Ltd. Product Price Promotion Place Elements of the Marketing Mix “The Four Ps” Elements of the Marketing Mix “The Four Ps”

Chapter 12 Copyright © 2008 by Nelson, a division of Thomson Canada Limited13 Product Strategy Brand name Packaging Colours Warranty Accessories Service program “Product” -- The “Heart” of the Marketing Mix

Chapter 12 Copyright © 2008 by Nelson, a division of Thomson Canada Limited14 Pricing Strategy Based on demand for the product and the cost of producing it. Also, special considerations can influence the price.

Chapter 12 Copyright © 2008 by Nelson, a division of Thomson Canada Limited15 Distribution Strategy (Place) Creating the means (channels) by which a product flows from the producer to the customer.

Chapter 12 Copyright © 2008 by Nelson, a division of Thomson Canada Limited16 Promotion Strategy Personal selling Advertising Public relations Sales promotion

Chapter 12 Not-for-Profit Marketing 17 Copyright © 2011 by Nelson Education Ltd. Goals of Social Marketing Goals of Social Marketing Evaluate the relationship between marketing and society Effect social change Further social causes

Chapter 12 Consumer Decision-Making Process 18 Copyright © 2011 by Nelson Education Ltd.

Chapter 12 Influences on Consumer Decision Making 19 Psychological Influences Individual Influences Social Factors Cultural Factors Copyright © 2011 by Nelson Education Ltd.

Chapter 12 Types of Consumer Buying Decisions 20 Copyright © 2011 by Nelson Education Ltd.

Chapter 12 The Business-to-Business Market 21 Characteristics of the Business- to-Business Market Location of Buyers Purchase Volume Number of Customers Direct Distribution Copyright © 2011 by Nelson Education Ltd.

Chapter Copyright © 2011 by Nelson Education Ltd. Volume Amount of use (light versus heavy) Benefit Benefits provided by the good or service Psychographic Lifestyle, personality, interests, values, attitudes Geographic Regional location, population density, city/county size, climate Demographic Age, education, gender, income, race, social class, household size Forms of Market Segmentation

Chapter 12 The Marketing Research Process Collect the data 2. Choose a method of research 1. Define the Marketing Problem 4. Analyze the research data 5. Make recommendations Copyright © 2011 by Nelson Education Ltd.

Chapter 12 Trends 24 One-to-one Marketing Scanner-Based Research Internet Marketing Research Copyright © 2011 by Nelson Education Ltd. Loyalty Cards