PRINCIPLES OF MARKETING

Lecturer: Prof. Dr. Nguyen Thi Tuyet Mai

 Introduction
• Study
▪ BA: NEU
▪ MBA: Boise State University
▪ Ph.D. (in marketing): National University of Singapore
• Teaching
▪ National Economics University (NEU)
▪ National University of Laos
▪ Washington State University (USA)
▪ Chuo University; Doshisha University (Japan)
• Research & consulting
▪ Marketing (consumer behavior & macromarketing)
▪ Entrepreneurship
▪ Knowledge creation & management
▪ Working: Institute for Sustainable Development
 Chapter One

Creating Customer Value and

engagement
 Creating and Capturing
Customer Value
Topic Outline
• Define marketing and outline the steps in the
marketing process
• Understanding the Marketplace and Customer
Needs
• Designing a Customer-Driven Marketing Strategy
• Preparing an Integrated Marketing Plan and
Program
• Building Customer Relationships
• Capturing Value from Customers
 What Is Marketing?

Marketing is a process by which

companies create value for customers
and build strong customer relationships
to capture value from customers in
return

- For-profit cos.
- For non-profit organizations (Univ., hospital,
churches)
 The customers

• What do customers buy?

Benefits!
• Where is the value of a
product found?
In the customer’s
mind!
• People are different with
different needs, wants & tastes.
Therefore, product values are
different.
 What do customers buy?
“In the factories we make cosmetics;
In the drugstore we sell HOPE.”
Charles Revson (Revlon)

Copyright © 2009 Pearson Education, Inc.

Publishing as Prentice Hall
Important Point: don’t
focus on the product,
focus on the benefit

Ad suggests that drinking

more orange juice can
fight cancer

The product is juice, but

the benefit is health
 Definition of Marketing

• Marketing is the management

process for identifying,anticipating
and satisfying customer
requirements profitably
(….requirements whilst achieving the
goals of the organisation)

The Chartered Institute of Marketing

 Understanding the Marketplace
and Customer Needs
Core Concepts
• Customer needs, wants, and demands
• Market offerings
• Customer Value and satisfaction
• Exchanges and relationships
• Markets
Key concepts in marketing

Marketing
concept

Exchange and
Relationship
 Understanding the Marketplace
and Customer Needs
Customer Needs, Wants, and Demands

• States of deprivation
• Physical—food, clothing, warmth, safety
Needs • Social—belonging and affection
• Individual—knowledge and self-expression

• Form that human needs take as they are shaped by

Wants culture and individual personality

Demands • Human wants backed by buying power

 Understanding the Marketplace
and Customer Needs

• Market offerings are some

combination of products, services,
information, or experiences offered to a
market to satisfy a need or want
• Marketing myopia is focusing only on
existing wants and losing sight of
underlying consumer needs
 Understanding the Marketplace
and Customer Needs
Customer Value and Satisfaction
Expectations
Customers
• Value and
satisfaction

Marketers
• Set the right level of
expectations
• Not too high or low
Understanding the Marketplace
and Customer Needs

Exchange is the act of obtaining a

desired object from someone by offering
something in return
 Understanding the Marketplace
and Customer Needs

Markets are the set of actual and

potential buyers of a product or service
 Designing a Customer-Driven
Marketing Strategy

Marketing management is the art and

science of choosing target markets and
building profitable relationships with
them
– What customers will we serve?
– How can we best serve these customers?
 Designing a Customer-Driven
Marketing Strategy
Selecting Customers to Serve

Market segmentation refers to dividing

the markets into segments of customers
Target marketing refers to which
segments to go after
 Designing a Customer-Driven
Marketing Strategy
Selecting Customers to Serve
Demarketing is marketing to reduce
demand temporarily or permanently; the
aim is not to destroy demand but to
reduce or shift it
 Designing a Customer-Driven
Marketing Strategy
Marketing Management Orientations

Production Product Selling Marketing Societal

concept concept concept concept concept
Discussion: Has marketing changed?

Pepsi
Societal
Marketing concept Production
concept

Marketing
Modern concepts Product
Marketing concept
New concept
Selling
concept
 Designing a Customer-Driven
Marketing Strategy
Marketing Management Orientations

Production concept is the idea that

consumers will favor products that are
available or highly affordable

Any color you like as long

as it’s black
Henry Ford
 Designing a Customer-Driven
Marketing Strategy

Marketing Management Orientations

Product concept is the idea that

consumers will favor products that offer
the most quality, performance, and
features. Organizations should
therefore devote its energy to making
continuous product improvements.
 Designing a Customer-Driven
Marketing Strategy
Marketing Management Orientations

Selling concept is the idea that

consumers will not buy enough of the
firm’s products unless it undertakes a
large scale selling and promotion effort
 Designing a Customer-Driven
Marketing Strategy
Marketing Management Orientations

Marketing concept is the idea that

achieving organizational goals depends
on knowing the needs and wants of the
target markets and delivering the
desired satisfactions better than
competitors do
 Designing a Customer-Driven
Marketing Strategy
Marketing Management Orientations

Societal marketing concept

is the idea that a company
should make good
marketing decisions by
considering consumers’
wants, the company’s
requirements, consumers’
long-term interests, and
society’s long-run interests
 Has marketing changed?

More emotion
More relation marketing Online & offline Tech focus
marketing personalization, marketing Data-driven
Customer loyalty customization marketing
 Building Customer Relationships
Customer Relationship Management
(CRM)

• The overall process of building and

maintaining profitable customer
relationships by delivering superior
customer value and satisfaction
Building Customer Relationships
Relationship Building Blocks: Customer
Value and Satisfaction

Customer Customer
perceived value satisfaction
• The difference • The extent to
between total which a
customer value product’s
and total perceived
customer cost performance
matches a
buyer’s
expectations
 Building Customer Relationships

Partner relationship management

involves working closely with partners in
other company departments and
outside the company to jointly bring
greater value to customers
 Building Customer Relationships
Partner Relationship Management
• Partners inside the company is every
function area interacting with customers
– Electronically
– Cross-functional teams
• Partners outside the company is how
marketers connect with their suppliers,
channel partners, and competitors by
developing partnerships
 Capturing Value from Customers
Creating Customer Loyalty and
Retention

• Customer lifetime value is the value of

the entire stream of purchases that the
customer would make over a lifetime of
patronage
 Capturing Value from Customers

Customer equity is the total combined

customer lifetime values of all of the
company’s customers
The New Marketing Landscape

Major Developments

Rapid
Digital age
globalization

Ethics and
Not-for-profit
social
marketing
responsibility