The Role of Marketing (Cambridge International IGCSE Business)
Identifying & Satisfying Customer Needs
Spec point — "• Identifying customer needs • Satisfying customer needs • Maintaining customer loyalty • Building customer relationships"
Identifying and satisfying customer needs
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Marketing helps a business identify and satisfy the needs and wants of its customers
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Identifying customer needs involves finding out about the
- Variety and quality of goods and services that customers want
- Prices they are willing to pay
- Promotional techniques that may persuade them to make repeated purchases
- Convenience factors, including where and how they want to purchase products
- After-sales services they anticipate
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Satisfying these customer needs involves ensuring products are available when and where customers want to buy them, at a suitable price, at the quality expected and with effective customer service
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The benefits of identifying customer needs
The ultimate aim of identifying and meeting customer needs is to ensure business survival and success
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Businesses that successfully identify and satisfy customer needs
- Will compete more effectively than rival businesses
- Will keep up to date with changing tastes and preferences
- Will attract positive word-of-mouth recommendations and build the brand
Benefits of understanding customer needs
| Cutomer need | Explanation | Benefit to the business |
|---|---|---|
| Price | - This is the amount of money a customer is willing to pay for a product or service - Customers often have a budget in mind and want to find the best value for their money | - Understanding this helps the business set competitive prices and offer **appealing promotions **to their target market |
| Quality | - Quality refers to the standard of excellence that a customer expects from a product or service - Customers want products that are reliable, durable, and meet their expectations - They also want good quality after-sales service | - Understanding this helps businesses create products that meet the desired standards, which can lead to** customer loyalty** and positive word-of-mouth advertising |
| Choice | - Customers often have a wide range of preferences and want to be able to choose from a variety of products or services - Varied features, such as sizes, colours and styles, are required by different customers | - Understanding this helps businesses offer a range of product options that cater to different customer preferences - This can increase customer satisfaction and loyalty, as customers are more likely to purchase a product that meets their specific needs |
| Convenience | - Customers value convenience because they want products that are easy to access and use - This includes factors such as location, online ordering, and fast delivery - Customers may also want a variety of ways to pay for the products | - Understanding this helps businesses to create a customer experience that is both efficient and enjoyable - By providing a convenient shopping experience, businesses can build customer loyalty and increase repeat sales |
Customer Loyalty & Relationships
Customer loyalty and relationships
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Customer loyalty is when existing customers buy products from the same business over and over again
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Customer loyalty leads to repeat purchases and a rise in market share.
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It is much cheaper for a business to try to keep existing customers(for example, with loyalty cards) than trying to gain new customers, as this can involve expensive advertising campaigns
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Building customer relationships involves communicating with customers to encourage them to become loyal to the business and its products
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Good relationships are maintained by
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Developing close ties with customers and finding out if products/services are continuing to meet their needs
- E.g., Using surveys to discover if preferences are changing
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Using technology to gather important information about customers
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By having strong relationships with the customer, the business can respond appropriately when customers change their expectations of what they want from a good or service
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