1. A Brief Introduction to Marketing and Customer Relationship Building
Jeremy Kees, Ph.D.

2. Who is Jeremy Kees??

3. CONSUMER

4. American Marketing Association’s new 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.

5. Kotler & Keller’s definition of marketing management:
The art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.

6. Value, Value, Value
Successful products and services deliver value and satisfaction to customers
We make buying decisions based on which product is perceived to offer the most value
Tangible/Intangible benefits vs. cost

7. How do we create customers?
Identifying customer needs
Designing goods and services that meet those needs
Communicate Information about those goods and services to prospective buyers
Making the goods or services available at times and places that meet customers’ needs
Pricing goods and services to reflect costs, competition, and customers’ ability to buy
Providing for the necessary service and follow-up

8. How do we create VALUE? Identify the needs in the marketplace
Find out which needs the organization can profitably serve
Design goods 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

9. “4 Eras” of Marketing

10. From transaction-based marketing to relationship marketing…
Transaction–based marketing (Simple exchanges)
Relationship marketing
Lifetime value of a customer
Converting new customers to advocates

11. From transaction-based marketing to relationship marketing…

12. Transaction vs. Relationship Marketing

13. 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 for sustained competitive advantage
Moderate
High

14. Let’s take a step back…
Although it is very important to try to build relationships with customers to ensure LT success
But, it is just as important to determine which consumers we want this relationship with!!
Target Market
“Costly” Consumers
Sprint Video

16. 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

17. 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

18. 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…

19. Strategies for Building Customer Relationships
Database Marketing
software that analyzes marketing information, then identifies and targets messages toward specific groups of potential customers

20. Strategies for Building B2B Relationships
Strategic alliance
a partnership formed to create a competitive advantage
These more formal long-term partnership arrangements improved each partner supply-chain relationships and enhance flexibility
Wal-Mart!

21. 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 seller–based on existing agreement with a buyer– determines how much of a product is needed

22. Strategies for Building B2B Relationships
Database Marketing
software that analyzes marketing information, then identifies and targets messages toward specific groups of potential customers

23. Evaluating Relationships
Lifetime Value (LTV)
Refers to the net present value of the potential revenue stream for any particular customer over a # of years
Starts with current purchase activity then extrapolates to include potential additions from cross-selling, upgrades, total ownership, etc.

24. Marketing Concept Based on Consumer Orientation
100% focus toward the consumer
Consumer drives company-wide decisions
Focused on LONG TERM success

25. Building Buyer-Seller Relationships
Many customers are seeking ways to simplify their lives, and relationships provide a way to do this
Customers find comfort with brands that have become familiar through their ongoing relationships with companies or when they feel like they can relate to a company
Dove’s Campaign for REAL Beauty
Evolution
Such relationships often lead to more efficient decision-making my customers and higher levels of customer satisfaction

26. The Value of Customer Retention
On average, it costs over 10 TIMES 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.