1. Chapter 1
Marketing in a Changing World: Creating Customer Value and Satisfaction

2. Road Map: Previewing the Concepts
Define what marketing is and discuss its core concepts.
Explain the relationships between customer value, satisfaction, and quality.
Define marketing management and understand how marketers manage demand and build profitable customer relationships.
Compare the five marketing management philosophies.
Analyze the major challenges facing marketers heading into the new “connected” millennium.

3. What is Marketing?
Simply put: Marketing is the delivery of customer satisfaction at a profit.
Goals: Attract new customers by promising superior value and
keep and grow current customers by delivering satisfaction.

4. Core Marketing Concepts (Fig. 1-1)

5. Marketing Defined
Process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others.

6. What are Consumers’ Needs, Wants, and Demands?
Needs - state of felt deprivation including physical, social, and individual needs i.e hunger
Wants - form that a human need takes as shaped by culture and individual personality i.e. bread
Demands - human wants backed by buying power i.e. money

7. What Will Satisfy Consumers’ Needs and Wants?
Products
Anything that can be Offered to a Market to Satisfy a Need or Want
Experiences
Persons
Places
Organizations
Activities
Ideas
Services
Activity or Benefit Offered for Sale That is Essentially
Intangible and Doesn’t Result in the Ownership of Anything

8. How Do Consumers Choose Among Products and Services?
Value Gained From Owning a Product and Costs of Obtaining the Product is Customer Value
Product’s Perceived Performance in Delivering Value Relative to Buyer’s Expectations is Customer Satisfaction
Total Quality Management Involves Improving the Quality of Products, Services, and Business Processes
Customer-Driven Quality

9. How Do Consumers Obtain Products and Services?
Transactions
Exchanges
Relationships
Building a Marketing
Network by Adding:
Financial Benefits
Social Benefits
Structural Ties
Profitable Customers

10. Interactive Student Assignments
Consider the following thought questions, formulate an answer, pair with the student on your right, share your thoughts with one another, and respond to questions from your instructor.
When was the last time you were completely satisfied with something you purchased?
What was it?
Why were you satisfied?
What did a marketer have to do with this?

11. Modern Marketing System (Fig. 1-2)

12. Marketing Management Marketing Management Demand Management Profitable
Involves managing demand, which involves managing customer relationships
Demand
Management
Finding and increasing demand, also changing or reducing demand such as in Demarketing
Profitable
Customer
Relationships
Attracting new customers and
retaining and building
relationships with current
customers

13. Marketing Management Practice
Stage 1. Entrepreneurial Marketing
Marketing Management Practice
Stage 2. Formulated Marketing
Stage 3. Intrepreneurial Marketing

14. Marketing Management Philosophies
Production Concept
Product Concept
Selling Concept
Marketing Concept
Societal Marketing Concept
Customer-Driven

15. Marketing and Sales Concepts Contrasted (Fig. 1-3)

16. Societal Marketing Concept (Fig. 1-4)

17. Discussion Question
What are the major differences between the Marketing Concept and the Societal Marketing Concept?
The Marketing Concept holds that achieving organizational goals depends on determining the needs and wants of target marketing and delivering the desired satisfactions more effectively and efficiently than competitors do.
The Societal Marketing Concept holds that generating customer satisfaction and long-run societal well-being are the keys to achieving both the company’s goals and its responsibilities.

18. Marketing Challenges in the New “Connected” Millennium (Fig. 1-5)

19. Technologies for Connecting
Learn About &
Track Customers
With Databases
Create Products &
Services Tailored to
Meet Customer Needs
Connecting Technologies in
Computers,
Telecommunications,
Information, & Transportation
Help To:
Distribute Products
More Efficiently &
Effectively
Communicate With
Customers in Groups
Or One-on-One

20. The Internet
The Internet has been hailed as the technology behind a New Economy.
New applications include:
“click-and-mortar” companies
“click-only” companies
Business-to-business e-commerce
Business-to-business transactions online are expected to reach $3.6 trillion in 2003.
By 2005, 500,000 companies will use the Internet to do business.

21. Connections With Customers
Most marketers are targeting fewer, potentially more profitable customers.
Asking:
What value does the customer bring to the organization?
Are they worth pursuing?
Connecting for a customer’s lifetime.

22. BankOne (Marketing at Work 1-3)
BankOne focuses on connecting with customers they can serve profitably.
Premier One customers know that they are “special, exclusive, privileged, valued.”

23. Direct Connections With Customers
Many companies use technologies to let them connect more directly with their customers.
Products available via telephone, mail-order catalogs, kiosks and e-commerce.
Some firms sell only via direct channels (i.e. Dell Computer, others use a combination.
Direct marketing is redefining the buyer’s role in connecting with sellers.
Buyers are active participants in shaping the marketing offer and process; some buyers design their own products online such as at

24. Connections With Marketing’s Partners
Connecting Inside the Company
Every employee must be customer-focused
Teams coordinate efforts toward customers
Connecting With Outside Partners
Supply Chain Management
Strategic Alliances

25. Connections With the World Around Us
Global
Connections
Broadening
Connections
Value
Connections
Social Responsibility
Connections

26. Rest Stop: Reviewing the Concepts
Define what marketing is and discuss its core concepts.
Explain the relationships between customer value, satisfaction, and quality.
Define marketing management and examine how marketers manage demand and build profitable customer relationships.
Compare the five marketing management philosophies.
Analyze the major challenges facing marketers heading into the next millennium.