Value based marketing

1. Value Based MarketingValue Based Marketing
Compiled by

Bermand Hutagalung

3. 3
Marketing – the activity, set of institutions,
and processes for creating, communicating,
delivering, and exchanging offerings that have
value for customers, clients, partners, and
society at large.
Marketing management is the art and science of
choosing target markets and building profitable
relationships with them. Marketer must define :
–What customers will we serve?
–How can we best serve these customers?
Marketing Definition

4. What Can Be
Marketed?
•Goods
•Services
•Places
•Ideas
•Events
•Persons
•Properties
•Organizations
•Information
•Experiences
•Social Political
What is being
marketed in this ad?

5. Marketing: Creating Utility
5
The ability of
goods and
services to
satisfy wants.
Form
Utility
Time
Utility
Place
Utility
Ownership
Utility
Customer need more than utility, they need value added

6. Marketing Trend : from Production to
Value Based Era
Production-oriented era
Sales-oriented era
Market-oriented era
Value-based marketing era

7. a set of processes for creating, communicating, and
delivering value to customers, build strong customer
relationships and for managing this relationships in
ways that benefit the customers, the organization,
and its stakeholders.
What is Value Based Marketing ?

8. Value
Base
Define target markets
and understand
customer value
Determine
value
Proposition
Deliver
value
Monitor
value
Map of Value Creation

9. Marketing and The Value Delivery Process

10. Rubbermaid Commercial Products, Inc.
(example of value based vision & mission)
“Our vision is to be the Global Market Share
Leader in each of the markets we serve. We
will earn this leadership position by
providing to our distributor and end-user
customers innovative, high-quality, cost-
effective and environmentally responsible
products. We will add value to these products
by providing legendary customer service
through our Uncompromising Commitment
to Customer Satisfaction.”

11. WHAT’S SO SPECIAL ABOUT ?
The legendary customer service

12. The Progression of Economic Value















COMPETITIVE
POSITION
Differentiated
Undifferentiated
DISTINCTIVENESS
MemorableUnmemorable
Pine & Gilmore, “Welcome to the Experience Economy,” HBR, July/Aug 1998.
Extract
commodities
Make
goods
Deliver
Customer
services
Stage
experiences

13. How much value does Starbucks add?
Cost of coffee bean when harvested =
$0.50/lb.
Value realized by Starbucks from selling
cup of coffee =
$230/lb.
AN INCREASE
IN VALUE
OF
+46,000%
See video : How Starbucks create value through excelent customer services

14. The value chain is a tool for identifying
was to create more customer value
because every firm is a synthesis of
primary and support activities performed
to design, produce, market, deliver, and
support its product.
The Importance of Value Chain
Customer value can be created through value chain

15. Porter’s Value Chain
Firm Infrastructure
Human Resource Management
Technology Development
Procurement
Support
Activities
Inbound Logistics
Primary
Activities Operations
Outbound
Logistics
Marketing
and Sales
Service
Upstream value activities Downstream value activities

16. Value Creation
Strategy at
Wal-Mart
Provide value for our customers
Low prices, everyday
Low inventory levels
Linked communications
between stores
Short flow times
Fast transportation
system
Cross-docking
Focused
locations
EDI/satellites
Wal-MartWal-Mart
MissionMission
Competitive Competitive
StrategyStrategy
Operations Operations
StrategyStrategy
Operations Operations
StructureStructure
Enabling Process Enabling Process
and Technologiesand Technologies

17. Marketing Focus Evolution :
From Production to Customer Relationship
17

18. Lastly Trend : From Value to Holistic Marketing
Holistic marketing sees itself as
integrating the value exploration, value
creation, and value delivery activities with
the purpose of building long-term, mutually
satisfying relationships and coprosperity
among key stakeholders.
Sources : Philip Kotler, Marketing
Management, Prentice Hall, 2009

19. The Marketer Strategic Task :
Creating Holistic Marketing
3.Value delivery 3.Value delivery

1.Value exploration1.Value exploration
(formulation)(formulation)
2.Value creation2.Value creation

Marketer - Marketer - Value Value
Based StrategyBased Strategy
Created by Bermand
4. Customer 4. Customer
RelationshipRelationship

20. Summary of Value Based Marketing

21. Thank You