Marketing Uas Notes

Ch.8 Products,services and brands : building customer value[pic 1]

g= goods  s= service  p= products

• Product - anything tht can be offered to market for attention, acquisition, use or consumption tht might satisfy want or need.
• Service - form of p; activity, benefit, satisfaction offered for sale tht is essentially intangible & doesn’t result in ownership of anything.
• Market offering - this becomes the basis which the company builds profitable customer relationship. Includes both g or s.

• Pure tangible g - ex)soap, toothpaste,or salt no s
• Pure s - primarily s ex) doctor exam / financial s

• Experiences - one tht enriches customers’ lives

 ex) Disney (manufacture dreams / memories), starbucks (more than just a cup of coffee, the experience)

        Companies tht market experiences realize tht customers are really buying much more thn just the p / s. They’re buying what those offers will do for them.

• Levels of p and s (3 levels)

Consumers see p as complex bundles of benefits tht satisfy their needs.

1. Core customer value - what is the buyer really buying?

1. Problem solving benefits/ s tht consumers seek

1. lipstick - more thn just for the color, it’s hope.
2. Ipad ″ ″ a computer, they’re buying self expression, entertainment, productivity, connectivity

1.  turn the core benefit into Actual product - develop features design, quality level, brand name & packaging.

1. iPad - its name,parts, styling, feature, packaging & other attributes have been carefully combined to deliver core customer value of staying connected.

1. Augmented product - offering additional consumer services and benefit.[pic 2]

1. Delivery and credit
2. After sale service
3. Product support
4. Warranty

ex) apple’s ⇑ 

Product and service classifications

• Consumer Products – p/s bought by final consumer for personal consumptions

(TABLE 8.1)

Industrial Products - p bought by individuals and organizations for further processing or for use in conducting a business.

distinction between consumer p & industrial p = based on purpose of purchase.

The Nature and Characteristics of a Service

• Service intangibility - Services tht cannot be seen, tasted, felt, heard, or smelled before they are bought

• Ex) cosmetic surgery, airline

• To reduce uncertainty, buyers look for signals of s quality.

4 Service characteristics

[pic 3]

• Service profit chain The chain that links service firm profits with employee and customer satisfaction. 5 links

1) Internal service quality: superior employee selection and training, a quality work environment, and strong support for those dealing with customers, which results in . . .

2)Satisfied & productive service employees: more satisfied, loyal, and hardworking employees, which results in . . .

3) Greater service value: more effective and efficient customer value creation and service delivery, which results in . . .

4)Satisfied & loyal customers: who remain loyal, repeat purchase, and refer other customers, which results in . . .

5) Healthy service profits & growth: superior service firm performance

Internal marketing - Orienting and motivating customer-contact employees & supporting s people to work as a team to provide customer satisfaction.

Interactive marketing - Training service employees in the fine art of interacting with customers to satisfy their needs.

3 types of service marketing[pic 4]

Managing Service Differentiation

• Solution to price competition is developing differentiated

1. Offer – innovative features tht set company’s offer apart from competitors’ offers. Ex) hotels offering car rental, banking, business center in lobby, free high speed internet.

1. Delivery – having more able & reliable customer contact people, developing superior delivery process. Ex) grocery stores with online shopping with home delivery.

1. Images – symbols & branding.

Managing Service Quality

Service firm can differentiate itself by delivering consistently higher quality than its competitors provide.

Top service companies set high service-quality standards. They watch service performance closely, both their own and that of competitors. They do not settle for merely good service (strive for 100% defect free)

service quality will always vary, depending on the interactions between employees and customers

service recovery can turn angry customers into loyal ones.

Good recovery can win more customer purchasing and loyalty