Marketing Lecture 1

Definition
Marketing is a process by which companies create value for customers and build
strong customer relationships to capture value from customers in return.

Process
1. Understand the marketplace and customer needs and wants
- Needs (Food, Clothing i.e. Food), Wants (i.e. Roti Canai, McDonald),
Demand (i.e. Marinis on 57 and Nobu KL)
- Market offerings (i.e. Bank, airline, hotel)
- Create, grow and exchange relationship

2. Design a customer value driven marketing strategy

- Select customer to serve
o Market segmentation
o Target Marketing
- Choose value proposition
o A set of benefits (i.e. T Mobile plan Family and friends stick
together)(i.e. Singapore airlines rely on continuos innovation
and service excellence)
- Marketing Management Orientation
o Production concept
Products that are available and highly affordable
May lead to Marketing myopia (Focus more on existing
products rather than fulfill customers wants and needs)
o Product concept
Focus on continuous improvement in terms of quality,
performance, and features
Marketing myopia
o Selling concept
Inside in view that focus on existing products and heavy
selling.
Sell what company makes rather than what market
wants
I.e. Insurance company
High risk due to focus on sales transactions rather than
build long-term profitable customer.
Thus, profit trough sales volume
o Marketing concept
Outside in view that focus on satisfies customers needs.
Marketers understand customers needs better than
customers themselves do.
Thus, profit through customer satisfaction
o Societal concept
Balancing customer wants, companies interest and
societal interest
 3. Prepare an integrated marketing plan and program
- Marketing mix (4Ps) used to to implement marketing strategy
- It is to transform marketing strategy into action

4. Build customer relationship

- Relationship building blocks
o Customer perceived value
Worth of product or service has in the mind of the
customer
o Customer satisfaction
Perceinved performance matches buyers expectation
- Engaging customers with empowerment of technologies
o Consumer write review on blogs about the brand or product

5. Capturing value from customers

- Customer lifetime value
o Customer loyalty
o Share of customer
I.e. Airlines want greater share of travel
I.e. Car companies increase share of garage
o Customer Equity
Measure future value of companys customer base
More loyal customer, more customer equity

The changing marketing landscape

1. Changing in economic environment

a. During economic crisis, frugality (Being economical) has come
back and marketers emphasize the value in their value
propositions
b. Online marketing
i. Click and mortar (Ventured online to attract new
customers)
c. Not for profit marketing growth (School, hospital, museum)
d. Rapid globalization (i.e. McDonald produce local goods but also,
purchase supplies and components from abroad)
e. Sustainable
i. CSR
ii. Environment
Lecture 2 Consumer behaviour & Buyer behaviour

Definition
Individuals or households that buy goods and services for personal consumption

Characteristic (Factors) influencing consumer behaviour

1. Cultural factor
a. Culture: A set of basic values, perceptions, wants and behaviours
learned by a member of society from family and other important
instituitions.
b. Subculture: Groups of people within a dominant culture with
shared value systems based on common life experiences and
situations.
i. I.e. Ethnic variation, age, nationality, language
c. Social Class: Measured as a combination of occupation, income,
education, wealth and other variables.

2. Social factor
a. Groups & Social networks
i. Membership Groups
1. Clubs, Association, Colleges
ii. Aspirational Groups
1. Aspire to be a member of an elite business @
business organization @ rock band
iii. Reference Group
1. Direct: Primary (Family & Friends), Secondary (Less
interaction)
2. Indirect: Aspirational, Non aspirational
iv. Online social networks, word of mouth etc.
1. I.e. Michelle Phan (Youtuber make up)
2. I.e. Paul Tan (Review about cars)
b. Family
c. Role and status
3. Personal factors
a. Gender
i. Cars, cosmetics, fashion, fragrances, music
b. Age
i. Entertainment, cars, banking, travel, furniture, internet
purchases
c. Family life cycle
i. Bachelor stage (Recreation/fashion)
ii. Newly married couple (Durables/Furniture)
iii. Full nest (Focus on child/Cheap holidays)
iv. Empty nest (Medical care)
v. Solidatory survivor (Medical, security)
d. Personality
i. Individual differences in characteristic patterns of thinking,
feeling and behaving
1. Sincerity
2. Excitement
3. Competence
4. Sophistication
5. Ruggedness

4. Psychological factors
a. Motivation
i. Definition: A need that is sufficiently pressing to direct the
person to seek satisfaction of the need
ii. I.e. An aging man buys a red sporty BMW. He may want to
impress his success. Or he wants to feel young and
independent again
iii. Maslow Hierarchy of need
1. Physiological needs (Food)
2. Safety need (Insurance, alarm system)
3. Social need (Smartphone, makeup)
4. Esteem need (Status, recognition)
5. Self actualization
 b. Perception
i. Definition: How we view surroundings around us and take
meaningful event out of it
ii. Two people might act differently because they perceived
the situation differently.
iii. I.e. some likes Samsung, some like Apple.
iv. Selective attention
1. People only open messages they want to receive
especially to the information that they are only
exposed to.
v. Selective distortion
1. People interpret information in a way that will
support what they already believe
vi. Selective retention
1. People remember only what they want to remember
(Last 10 year purchase Nikon camera, today still buy
Nikon because of trust on their quality)
c. Learning
i. Experience
ii. Drives -> Stimuli -> Cues -> Responses ->Reinforcement
iii. The marketers can build demand for a product by
associating with strong drives using motivating cues and
provide positive reinforcement

d. Belief & Attitudes

i. Belief: A pattern of knowledge/faith/opinion that an
individual holds as true
ii. Attitude: It is hard to change. Company should try to fit its
products into exisiting attitudes rather than attempt tp
change attitudes.

5. Situational factors
a. Physical surroundings Location, aromas, sounds lightinh
b. Social surroundings Friends, relatives, salespeople
c. Time perspective Time of day, season, week, month
d. Reason for purchase Gift, household
e. Buyer mood and condition Anger, illness, fatigue, having cash
Types of buying decision behavior
1. Complex - buying behaviour
a. High involvement
b. Expensive
c. High Risk
d. E.g. Computers, cars
2. Dissonance - reducing buying behaviour
a. High involvement
b. Expensive
c. High Risk
d. Few differences between brands
e. E.g. Diamond ring, house
3. Variety seeking buying behaviour
a. Low involvement
b. Inexpensive
c. Less risk
d. Brand Switch
e. Significant differences between brands
f. E.g. Chips, chocolates
4. Habitual buying behaviour
a. Low involvement
b. Inexpensive
c. Less risk
d. Frequent purchase
e. Limited differences between brands
f. E.g. Bread, milk, flour, sugar

Process of buying decision

1. Need recognition
a. Discovery of discrepancy between actual state & desired state
2. Information search
a. Internal source: Previous experience (I.e. Nikon), family members,
friends
b. External source: Media
3. Evaluation of alternatives
a. Comparison takes place (4Ps Product, promotion, price, place)
4. Purchase decision
a. Factors influencing consumer behaviour (See above)
5. Postpurchase decision
a. Satisfies or dissatisfied
b. Cognitive dissonance caused by postpurchase conflict
i. Did i make a good decision
ii. Did i buy right product?
For new products
1. Definition: Good, service or idea that is perceived by some potential
customers as new
2. Adoption process
a. Awareness
i. Consumer becomes aware of the new product but lack
information
b. Interest
i. Seeks information about the product
c. Evaluation
i. Compare 4Ps
d. Trial
i. Tries new product in a small scale to improve his estimate
of its value
e. Adoption
i. Decide to make full and regular use of the new product