MARKETING MANAGEMENT

CONNECTING WITH
CUSTOMERS

Nadia Tantuco
Ateneo Graduate School of Business
October 3, 2014

ph.linkedin.com/in/nadiatantuco
OUTLINE:
Why do we need to connect with
customers?
1) Good marketing starts with strong customer
relationships
Creating Long-term Loyalty Relationships (chapter
5)
2) To understand how consumers think, feel, and act;
and offer clear value to each and every target
consumer
Analyzing Consumer Markets (chapter 6)
3) Sellers need to understand business
organizations, in order to create and capture value
Analyzing Business Markets (chapter 7)
OUTLINE:
Why do we need to connect with
customers?
1) Good marketing starts with strong customer
relationships
Creating Long-term Loyalty Relationships (chapter
5)
2) To understand how consumers think, feel, and act;
and offer clear value to each and every target
consumer
Analyzing Consumer Markets (chapter 6)
3) Sellers need to understand business
organizations, in order to create and capture value
Analyzing Business Markets (chapter 7)
Creating loyal customers is at
the heart of every business.
Marketers must build:
Customer Value
Satisfaction
Loyalty
Customer Value
Customers are more than ever better
informed and educated.

They have tools to verify

companies product claims.
They can seek for better
alternatives.
They are value maximizers.
Customer Value
Managers must analyze their strengths
and weaknesses versus competition.

Customer Value Analysis steps:

1. Identify attributes and benefits that customers
value
2. Rate in terms of priority or importance
3. Compare with competitors attributes and
benefits
4. Examine customer values in specific segments
5. Monitor customer values over time
Customer Value
Delivering a high customer value means
creating a compelling value proposition.

A value proposition
Consists of all the benefits the company
promises to deliver
Is more than the core positioning of the
offering
A promise about the experience customers
can expect
Customer Satisfaction
A product offer must meet customer
expectations to generate satisfaction.
A customer-centered firm seeks to create
high customer satisfaction. (But this is
not the ultimate goal.)
The company must balance delivering
high customer satisfaction and delivering
acceptable levels to other stakeholders,
given its total resources.
Customer Satisfaction
Satisfaction also depends on product
or service quality.
Higher levels of quality can better
support higher prices and lower costs.
Quality is clearly the key to value
creation and customer satisfaction.
Customer Loyalty
Marketing is the art of attracting and
keeping profitable customers.
Customer-Product Profitability Analysis:
Customer Loyalty
Companies must use information
wisely and interact with their
customers.
To cultivate strong customer
relationships, companies must
1. Manage customer relationships
2. Attract and retain customers
3. Build Loyalty
Cultivating Customer Relationships 1:
The goal of customer relationship
management (CRM) is to maximize
loyalty.
CRM is a process that
Manages detailed information about
individuals
Distinguishes customer touch points
Enables companies to provide real-time
customer service
Cultivating Customer Relationships 1:
Companies can create stronger bonds
with customers by personalizing
relationships.
CRM can be practiced through
Personalized Marketing
creating brand relevance for each
individual
Customer Empowerment
consumers as brand
evangelists/ambassadors
Recommendations from consumers
Cultivating Customer Relationships 2:
Attracting and retaining customers
require companies to manage various
consumer levels.
The different levels in a Marketing Funnel:
Cultivating Customer Relationships 2:
Winning companies improve their
value through excellent management
of their customer base.
Strategies in managing the customer
base:
1. Reducing customer defection
2. Increasing company-customer
engagement
3. Creating new offerings and opportunities
for existing customers
4. Managing low-profit customers
5. Focusing on high-profit customers
Cultivating Customer Relationships 3:
Creating a strong, tight connection to
customers is the key to long-term
success.
Building loyalty though
Understanding customer point of view
Developing loyalty programs
Creating customer databases
Cultivating Customer Relationships 3:
Database marketing helps companies in
knowing more about their target market.
However, assumptions gathered from
these databases may not always hold
true.
Companies must proceed thoughtfully
in how they would use the information
provided.
Customers are value maximizers.

They form expectations of value and act

on it.
They will buy from the company that they
perceive has the highest customer-
delivered value.
Companies must cultivate strong
customer relationships to capture
consumers and build loyalty.
OUTLINE:
Why do we need to connect with
customers?
1) Good marketing starts with strong customer
relationships
Creating Long-term Loyalty Relationships (chapter
5)
2) To understand how consumers think, feel, and act;
and offer clear value to each and every target
consumer
Analyzing Consumer Markets (chapter 6)
3) Sellers need to understand business
organizations, in order to create and capture value
Analyzing Business Markets (chapter 7)
The aim of marketing is to meet
& satisfy targets needs and
wants (better than competition).
Marketers must understand:
What influences consumer behavior
Key psychological processes
The buying decision process
Influences of consumer behavior 1:
Culture is the fundamental determinant
of a persons wants and behavior.

Values differ per country

Subcultures exist
Social classes
Influences of consumer behavior 2:
Social factors also affect our buying
behavior.

Reference groups
Family
Social roles/status
Influences of consumer behavior 3:
Personal factors have a direct impact
on consumer behavior.

Age
Occupation
Personality
Lifestyle and values
Its important to understand how
marketing stimulus affects
consumers purchase decision.
Model of consumer behavior:
Key Psychological Process 1:
Motivation is when a need becomes
aroused to a level of intensity that drives
us to act.
3 theories of human motivation:
1. Freuds
2. Maslows
3. Herzbergs
Key Psychological Process 2:
Perception is the process of how we
interpret information to create a
meaningful picture of the world.
Different perceptions of things result
from:
Selective
1. Attention
2. Distortion
3. Retention
Key Psychological Process 3:
Learning induces changes in our
behavior arising from experience.

Learning is produced through the

interplay of drives, stimuli, cues,
responses, and reinforcement.
Marketers can thus build product demand
by associating it with strong drives,
using motivational cues, and providing
positive reinforcement.
Key Psychological Process 4:
Emotions are involved when consumer
response is not all rational but invokes
different feelings.
Emotional marketing campaigns help
build stronger connections with
consumers.
People can relate more to the brand
instead of just associating it as a product.
Key Psychological Process 5:
Memory helps us create brand
associations.

Brand associations consists of all brand-

related thoughts, feelings, images,
experiences, and so on that become
linked to the brand.
Marketing can be a way of making sure
that consumers have positive brand
experience and knowledge.
Smart companies know that they
must understand customers
buying decision process.

The 5-stage model of the Consumer

Buying Process:
Stage 1: Problem recognition
Circumstances that trigger a particular
need should be identified.
The process starts when the buyer
recognizes a problem or a need.
Gathering information to identify these
triggers are needed to develop key
marketing strategies.
Stage 2: Information search
Companies must strategize to get its
brand into consumers awareness and
choice sets.
Consumers often search for limited
amounts of information.
Effective information often comes from
personal or experiential sources, if not
public sources that are independent
authorities.
Stage 3: Evaluation of alternatives
Current models of evaluation see
consumers forming judgments based on
a conscious and rational basis.
Some basic concepts to better
understand the consumer evaluation
process:
1. Satisfy a need
2. Looking for certain benefits
3. Product as a bundle of attributes
Stage 4: Purchase Decision
A consumer may form an intention buy
the most preferred brand in a choice
set.
5 Sub-decisions:
1. Brand
2. Dealer
3. Quantity
4. Timing
5. Payment method
Stage 5: Post-purchase Decision
The Marketers job does not end with
the purchase.

After purchase, marketers must monitor

post-purchase
Satisfaction
Actions
Uses and disposal
Consumers are constructive
decision makers.

Their decisions are influenced by

contextual influences.
They often exhibit low involvement in
their decisions.
Thus, marketers must be well informed
about consumer behavior and their
buying decision process.
OUTLINE:
Why do we need to connect with
customers?
1) Good marketing starts with strong customer
relationships
Creating Long-term Loyalty Relationships (chapter
5)
2) To understand how consumers think, feel, and act;
and offer clear value to each and every target
consumer
Analyzing Consumer Markets (chapter 6)
3) Sellers need to understand business
organizations, in order to create and capture value
Analyzing Business Markets (chapter 7)
Some of the worlds most valued
brands belong to business
markets.
Business organizations not only sell; they
also buy vast quantities of
raw materials
supplies
manufacturing components
plant and equipment
business services
Business markets differ from
consumer markets.

Business markets have

Fewer and larger buys
Closer customer relationship
More geographically centered businesses
Cultivating the right relationships
with businesses is important for
any holistic marketing program.
Business marketers must form strong
bonds with their customers.
Some customers, however, may prefer a
transactional relationship.
SUMMARY:
Why do we need to connect with
customers?
1) Well-conceived holistic marketing orientation starts
with strong customer relationships.
Creating Long-term Loyalty Relationships (chapter 5)
2) To have a thorough understanding of how consumers
think, feel, and act; and offer clear value to each and
every target consumer.
Analyzing Consumer Markets (chapter 6)
3) To create and capture value, sellers need to
understand business organizations needs,
resources, policies, and buying procedures.
Analyzing Business Markets (chapter 7)
CONCLUSION:
Why do we need to connect with
customers?
Good marketing starts with
Understanding the target consumer
and
Knowing how to satisfy their needs and
wants.
MARKETING MANAGEMENT
CONNECTING WITH
CUSTOMERS

Nadia Tantuco
Ateneo Graduate School of Business
October 3, 2014

ph.linkedin.com/in/nadiatantuco