The document discusses the importance of connecting with customers for effective marketing. It outlines that (1) good marketing starts with strong customer relationships built on trust and loyalty over time, (2) understanding how consumers think and feel is key to offering value tailored to each customer segment, and (3) success in business markets requires understanding organizational needs, resources, policies, and purchasing procedures. The conclusion emphasizes that good marketing is based on thoroughly understanding target customers and satisfying their needs better than competitors.

1. MARKETING MANAGEMENT
CONNECTING WITH
CUSTOMERS
Nadia Tantuco
Ateneo Graduate School of Business
October 3, 2014
ph.linkedin.com/in/nadiatantuco

2. 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)

3. 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)

4. Creating loyal customers is at the
heart of every business.
• Marketers must build:
 Customer Value
 Satisfaction
 Loyalty

5. 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.

6. 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

7. 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

8. 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.

9. 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.

10. Customer Loyalty
Marketing is the art of attracting and
keeping profitable customers.
• Customer-Product Profitability Analysis:

11. 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

12. 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

13. 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

14. Cultivating Customer Relationships 2:
Attracting and retaining customers
require companies to manage various
consumer levels.
• The different levels in a Marketing
Funnel:

15. 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

16. 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

17. 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.

18. 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.

19. 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)

20. The aim of marketing is to meet &
satisfy target’s needs and wants
(better than competition).
• Marketers must understand:
 What influences consumer behavior
 Key psychological processes
 The buying decision process

21. Influences of consumer behavior 1:
Culture is the fundamental
determinant of a person’s wants and
behavior.
• Values differ per country
• Subcultures exist
• Social classes

22. Influences of consumer behavior 2:
Social factors also affect our buying
behavior.
• Reference groups
• Family
• Social roles/status

23. Influences of consumer behavior 3:
Personal factors have a direct impact
on consumer behavior.
• Age
• Occupation
• Personality
• Lifestyle and values

24. It’s important to understand how
marketing stimulus affects
consumers’ purchase decision.
• Model of consumer behavior:

25. 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. Freud’s
2. Maslow’s
3. Herzberg’s

26. 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

27. 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.

28. 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.

29. 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.

30. Smart companies know that they
must understand customers’
buying decision process.
• The 5-stage model of the Consumer
Buying Process:

31. 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.

32. 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.

33. 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

34. 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

35. Stage 5: Post-purchase Decision
The Marketer’s job does not end with
the purchase.
• After purchase, marketers must monitor
post-purchase…
 Satisfaction
 Actions
 Uses and disposal

36. 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.

37. 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)

38. Some of the world’s 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

39. Business markets differ from
consumer markets.
• Business markets have…
 Fewer and larger buys
 Closer customer relationship
 More geographically centered businesses

40. 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.

41. 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)

42. 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.

43. MARKETING MANAGEMENT
CONNECTING WITH
CUSTOMERS
Nadia Tantuco
Ateneo Graduate School of Business
October 3, 2014
ph.linkedin.com/in/nadiatantuco