Do utility created by converting production inputs into finished products is called?

Chapter 14

MANAGING CUSTOMER RELATIONSHIPS

Relationship marketing refers to marketing decisions and activities focused on

achieving long-term, satisfying relationships with customers. Relationship marketing

continually deepens the buyer’s trust in the company, which, as the customer’s

loyalty grows, increases a company’s understanding of the customer’s needs and

desires. Successful marketers respond to customers’ needs and strive to continually

increase value to buyers over time.

To build long-term customer relationships, marketers are increasingly turning to

marketing research and information technology. Customer relationship

management (CRM) focuses on using information about customers to create

marketing strategies that develop and sustain desirable customer relationships. By

increasing customer value over time, organizations try to retain and increase long-

term profitability through customer loyalty.

Managing customer relationships requires identifying patterns of buying behaviour

and using this information to focus on the most promising and profitable customers.

Companies must be sensitive to customers’ requirements and desires and establish

communication to build customers’ trust and loyalty. In some instances, it may be

more profitable for a company to focus on satisfying a valuable existing customer

than to attempt to attract a new one who may never develop the same level of

loyalty.

The customer lifetime value is a measure of a customer’s worth (sales minus costs)

to a business during one’s lifetime. There are also intangible benefits of retaining

lifetime-value customers, such as their ability to provide feedback to a company and

refer new customers of similar value.

UTILITY: THE VALUE ADDED BY MARKETING

Utility is the ability of a good or service to satisfy a human need.

Form utility is created by converting production inputs into finished products.

The three kinds of utility that are created directly by marketing are:

1.Place utility is created by making a product available at a location where

customers wish to purchase it.

2.Time utility is created by making a product available when customers wish to

purchase it.

3.Possession utility is created by transferring title (ownership) of a product to

buyer.

customers.

relationships.

lifetime.

need.

finished products.

Which type of utility is created when a firm converts raw materials into finished products that are desired by the market?

Which type of utility is created when a company makes products available where consumers want them?

Which of the following uses information about customers to create marketing strategies that develop and sustain?

When a company creates time and place utility by focusing on making products available when they are wanted?