1.
Mantra of Marketing
Marketing’s job is to create, communicate and deliver value to a target market
at a profit. Market Management needs to “Create Value,” “Communicate Value,”
and “Deliver Value.”
There are three businesses here: Product Management; Brand Management; and
Customer Management.
(Kotler at London Business Forum)

2.
Marketing Vs. Selling
SELLING MARKETING
1 Emphasis is on the product 1 Emphasis on consumer needs wants
2 Company Manufactures the 2 Company first determines customers
product first needs and wants and then decides out
3 Management is sales how to deliver a product to satisfy these
volume oriented wants
4 Planning is short-run- 3 Management is profit oriented
oriented in terms of today’s 4 Planning is long-run-oriented in today’s
products and markets products and terms of new
5 Stresses needs of seller products, tomorrow’s markets
6 Views business as a good and future growth
producing process 5 Stresses needs and wants of buyers
6 Views business as consumer producing
process satisfying process

3.
Marketing Vs. Selling
Selling Marketing
7 Emphasis on staying with 7 Emphasis on innovation on every existing
existing technology and technology and reducing every sphere, on
reducing costs providing better costs value to the
customer by adopting a superior technology
8 Different departments
work as in a highly separate 8 All departments of the business integrated
water tight compartments manner, the sole purpose being generation
of consumer satisfaction
9 Cost determines Price
9. Consumer determine price, price
determines cost
10 Selling views customer
as a last link in business
10. Marketing views the customer last link in
business as the very purpose of the business

4.
Marketing Mix
Marketing Mix is the combination of four
elements, called the 4P’s (Product, Price, Promotion and
Place), that every company has the option of
adding, subtracting, or modifying in order to create a
desired marketing strategy. (Philip Kotler)

5.
Marketing Mix - A mixture of several ideas and plans followed by a marketing
representative to promote a particular product or brand is called marketing mix. Several
concepts and ideas combined together to formulate final strategies helpful in making a
brand popular amongst the masses form marketing mix.
Elements of Marketing Mix
The elements of marketing mix are often called the four P’s of marketing.
• Product- Goods manufactured by organizations for the end-users are called products.
(Tangible Product and Intangible Product -Services)
• Price - The money which a buyer pays for a product is called as price of the product.
• Place - Place refers to the location where the products are available and can be sold or
purchased.
• Promotion - Advertising, Print media, Television, radio , Billboards, hoardings, banners,
Taglines , Word of mouth.
Lately three more P’s have been added to the marketing mix. They
are as follows:
• People - The individuals involved in the sale and purchase of products or services come
under people.
• Process - Process includes the various mechanisms and procedures which help the
product to finally reach its target market
• Physical Evidence - With the help of physical evidence, a marketer tries to communicate
the USP’s and benefits of a product to the end users

6.
Marketing Mix

7.
Product Mix
• Set of all product offered for sale by a
company.
• It consist of various product line.
• Any company’s product mix has four
dimension :
1. Width,
2. Length,
3. Depth,
4. Consistency.

8.
Product Mix
• Width : Number of different product lines
carries by the company.
• Length : Total number of items in the product
mix of the company.
• Depth : Assortment of size, color and models
offered in each item of a product line.
• Consistency : It refers to the relationship of
various product line either in their
end use, production requirement, distribution
channel or other way.

9.
Product Mix (P&G)

10.
5
Creating Customer Value,
Satisfaction,
and Loyalty
Marketing Management, 13th ed

11.
Chapter Questions
• What are customer value, satisfaction, and loyalty,
and how can companies deliver them?
• What is the lifetime value of customers?
• How can companies cultivate strong customer
relationships?
• How can companies both attract and retain
customers?
• What is database marketing?
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

12.
What is Customer Perceived Value?
Customer perceived value is the difference
between the prospective customer’s
evaluation of all the benefits and all the costs
of an offering and the perceived alternatives.
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

13.
Figure 5.2 Determinants of
Customer Perceived Value
Total customer benefit Total customer cost
Product benefit Monetary cost
Services benefit Time cost
Personal benefit Energy cost
Image benefit Psychological cost
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

14.
Steps in a Customer Value Analysis
• Identify major attributes and benefits that
customers value
• Assess the qualitative importance of
different attributes and benefits
• Assess the company’s and competitor’s
performances on the different customer
values against rated importance
• Examine ratings of specific segments
• Monitor customer values over time
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

15.
What is Loyalty?
Loyalty is a deeply held commitment to re-buy
or re-patronize a preferred product or service
in the future despite situational influences
and marketing efforts having the potential to
cause switching behavior.
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

16.
Top Brands in Customer Loyalty
• Avis • Land’s End
• Google • Coors
• L.L. Bean • Hyatt
• Samsung (mobile • Marriott
phones) • Verizon
• Yahoo! • KeySpan Energy
• Canon (office copiers) • Miller Genuine Draft
• Amazon
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

17.
Measuring Satisfaction
• Periodic surveys
• Customer loss rate
• Mystery shoppers
• Monitor competitive performance
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

18.
What is Quality?
Quality is the totality of features and
characteristics of a product or
service that bear on its
ability to satisfy
stated or implied needs.
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

19.
Maximizing Customer Lifetime Value
• Customer profitability
• Customer equity
• Lifetime value
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

20.
What is Customer Relationship Management?
CRM is the process of carefully managing
detailed information about individual
customers and all customer touch points
to maximize customer loyalty.
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

21.
Framework for CRM
• Identify prospects and customers
• Differentiate customers by needs and value to
company
• Interact to improve knowledge
• Customize for each customer
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

22.
Customer Retention
• Acquisition of customers can cost 5 times more than
retaining current customers.
• The average customer loses 10% of its customers
each year.
• A 5% reduction to the customer defection rate can
increase profits by 25% to 85%.
• The customer profit rate increases over the life of a
retained customer.
Copyright © 2009 Pearson
Education, Inc. Publishing as
Prentice Hall

23.
Customer Life time Value
customer lifetime value (CLV), lifetime
customer value (LCV), or user lifetime
value (LTV) is a prediction of the net profit
attributed to the entire future relationship with
a customer.

24.
Customer Lifetime Value
Advantages of CLV:
• management of customer relationship as an asset
• monitoring the impact of management strategies and marketing investments on
the value of customer assets
• determination of the optimal level of investments in marketing and sales activities
• encourages marketers to focus on the long-term value of customers instead of
investing resources in acquiring "cheap" customers with low total revenue value
• implementation of sensitivity analysis in order to determinate getting impact by
spending extra money on each customer.
• optimal allocation of limited resources for on going marketing activities in order to
achieve a maximum return
• a good basis for selecting customers and for decision making regarding customer
specific communication strategies
• measurement of customer loyalty (proportion of purchase, probability of purchase
and repurchase, purchase frequency and sequence etc.