Figures Chapter 1_2_3 - Croats value for customers and...

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Unformatted text preview: Croats value for customers and build customer relationships Construct an Understand the Design a and wants strategy superior value b e i Capture value fro: customers in rstu Build profitable Capture value ' t ted marketplace and customer-driven In egra relationships and from customers t< . marketing program customer needs marketing that delivers create custaomer create profits an delight customer equit 6 Flesearch Select customers Product and customers and to serve: market service design: the marketplace segmentation and build strong targeting brands Manage marketing information and Decide on a value Pricing: customer data proposition: create real value differentiation and positioning Distribution: manage demand and supply chains Promotion: communicate the value proposition Customer relationship management: build strong relationships with chosen customers loyal customer Capture customs lifetime value Partner relationship management: build strong relationships with marketing partners market and shar of customer Manage global markets Han-less marketing technology Ensure environmental and social responsibility Steps in Strategic Planning Corporate level arid market level Like the marketi . . strategy, the brggder IIIIIIII DEfinlng Sefilng an'IpElny Gampany strategy must ’ the company objectives mission and goals be customer Focused. yrluun: | 0.1: Major Forces in the Company's Macroenvironrnent Concern for the natural environment has spawned a so-called green movement. For example, last year HP recovered and recycled SODJumbo jets worth of electronics globally. Changing demographics mean changes in markets and marketing strategies. For example, Merrill Lynch targets -- aging baby boomers to help them overcome the hurdles to retirement olannlna. Planning marketing and other functional strategies Designing the business portfolio *5 Com pony-wide strategic planning guides marketing strategy and planning. Marketers also want to be socially responsible citizens In their markets and communities. For example, shoe brand TOMS was founded on a cause: ”No complicated formulas. It‘s slmpie.‘ says the company's founder. "You buy a pair oF TOMS and I give a pair to c child on your behatF.‘ 9 Table 2.1 | Market-Oriented Business Definitions Company Product-Oriented Definition Market-Oriented Definition Facebook We are an online social network. We connect people around the world and help them share important moments in their lives. Hulu We are an online video service. We help people enjoy their favorite video content anytime. anywhere. Home Depot We sell tools and home repair We empower consumers to achieve the homes of their and improvement items. dreams. NASA We explore outer space. We reach for new heights and reveal the unknown so that what we do and learn will benefit all humankind. Revlon We make cosmetics. We sell lifestyle and seltsexpression; success and status; memories, hopes, and dreams. Ritzscaliton We rent rooms. We create the Ritzscarlton experienceia memorable Hotels & Resorts stay that far exceeds guests' already high expectations. Walmart We run discount stores. We deliver low prices every day and give ordinary folks the chance to buy the same things as rich people. "Save Money. Live Better.” 'jl IHvIu— | fish The sec Growth-Share Matrix 5‘” Guestlon mark The company must decide how much It wIll Invest In each product or buslness {SBU}. For each SBU, It must decide whether to build hold. harvest. or divest Under the classlc ECG portfollo planning approach, the company Invests finds from mature. successful products and businesses {cash cows} to support promising products and buslnesses In taster-growing markets (stars and question marks}, hoping to turn Cash cow them Into future cash cows. '4 Market growth rate Low High Low Relative market share The Product/Market Existing New Expansion Grid products products Market Product penetration development Through dIversH‘ca'Iion. companies new markets for existing products. __ can grow by starting or buying For example. Starbucks Is expandlng - _ " businesses outside their current rapidly In China. which by 2015 will Market " product/markets. For example. be Its second-largest market, behind Diversification Starbucks ls enterlng the “health an- only the Unlted States. wellness“ market whit stores called Evolution By Starbucks. Companies can grow by developing Existing development 91 FIGURE I 2.4 Managing Marketing Strategies and the Marketing Mix Marketing strategy Involves two key questions: Which customers will we serve (segmentatton and targeting)? and How wtll we create value For them (dlfl‘erenttatton and positioning)? Then‘ the company designs a marketth program—the four Ps—tttat delivers the Intended value to targeted consumers. 9 FIGURE I 2.5 The Four P3 of the Marketing Mix oduot Marketing intermediaries Competitors Customer value and relationships Suppliers At its care‘ marketing Is all about creattng customs value and profitable customer relattonshlps. Product Variety List price Quality Discounts Design Allowances Features Payment period Brand name Credit terms Packaging Services Target customers Intended positioning Promotion ‘ Place Channels Coverage Locations Inventory Transportation Logistics Advertising Personal selling Sales promotion Public reiations Customer solution ioe Customer cost ace Convenience omotion Communication The markettng mix—or the four Ps—conslsts of tacttcc markettng tools blended Intr ' an Integrated marketing program that actually delivers the Intended value to target customers 0,‘ FIGURE l 2.6 Managing Marketing: Analysis, Planning. * * Analysts Implementation, and GontmI Planning Implementation H Control Develop strategic Carry out the Measure results plans plans The fist part at * the chapter dealt Evaluate results wlth thls—developlng " ’ company-wlde and ma rketl rig strategies it Develop marketing and plans. p|an5 Take corrective action 0, Table 2.2 We'll close the chapter by Icaklng at haw marketers manage those strategles and plans—haw they implement markerlng strategies and programs and evaluate the results. exploit to its advantage. And threats are unfavor- able external factors or trends that may present challenges to performance. Contents of a Marketing Plan Section Purpose Executive summary Current marketing situation Threats and opportunities analysis Objectives and issues Presents a brief summary of the main goals and recommendations of the plan for management review, helping top management find the plan’s major points quickly. Describes the target market and the company's position in it, including information about the market, product performance, competition, and distribution. This section includes the following: . Amarket descnption that defines the market and major segments and then reviews customer needs and factors in the marketing environment that may affect customer purchasing. - Aproduct review that shows sales, prices, and gross margins of the major products in the product line. 0 A review of competition that identifies major competitors and assesses their market positions and strategies for product quality, pricing, distribution, and promotion. - A review of distribution that evaluates recent sales trends and other developments in major distribution channels. Assesses major threats and opportunities that the product might face, helping management to anticipate important positive or negative developments that might have an impact on the frm and its strategies. States the marketing objectives that the company would like to attain during the plan’s term and discusses key issues that will affect their attainment. Action programs Budgets relationships and the specifics of target markets, positioning, and marketing expenditure levels. How will the company create value for customers in order to capture value from customers in return? This section also outlines specific strategies for each marketing mix element and explains how each responds to the threats, opportunities, and critical issues spelled out earlier in the plan. Spells out how marketing strategies will be turned into specific action programs that answer the following questions: What will be done? When will it be done? Who will do it? How much will it cost? Details a supporting marketing budget that is essentially a projected profit—and—Ioss statement. It shows expected revenues and expected costs of production, distribution, and marketing. The difference is the projected profit. The budget becomes the basis for materials buying, production scheduling, personnel planning, and marketing operations. Outlines the controls that will be used to monitor progress, allow management to review implementation results, and spot products that are not meeting their goals. It includes measures of return on marketing investment. . M k ii I t t Return on Markehng Investment Source: Adapted from Roland T. Rust, Katherine * N. Lemon. and Valerie A. Zeilnaml, “Return on Marketing: Using Consumer Equity to Focus Marl-teting Strategy," Journal of Marketing, Marketing returns Jamary 2004. p.112. Used with permission. Improved customer value and satisfaction Beyond measurlng return on marketing Investment In terms oF standard performance measures such as sales or market share, many companles are uslng customer- reIa‘ltonshIp measures, such as customer satisFoctIon, retentton. and equlty. These are more dlffizult to measure but capture both current and Future performance. '1‘ FIGURE | 3.1 Return on marketing investment 7 — Increased customer Increased customer Cost of marketir attraction retention investment Increased customer lifetime values and customer equity customers from Beijing to Moscow to Middletown, Ohio, flock to the Scandinavian retailer's Actors in the Microenvironment In creating value For customers, marketers must partner wlth ‘_ other fi'ms In the company‘s is value dellvery network. Marketer-5 mug- Work In harmony wfi-h oth er company departments I'D CI'EEITE CUEI'DITIEI' value and relottonshlps. Customers are the most Important actors In the . company‘s mlcroenvlronment. The aim of the entire value dellvery system is to serve target customers and create sh'ong relationships wlth then ...
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