Contents

1. 2. 3. a. 4. a. b. c. d. e. f. g. 5. a. b. c. d. e. 6. 7. 8. Abstract ................................................................................... 2 Introduction ............................................................................. 2 Core product ............................................................................ 2 Focus of the company ............................................................. 2 Tangible product ....................................................................... 3 Features ................................................................................ 3 Packaging.............................................................................. 3 Process ................................................................................. 3 Price ..................................................................................... 4 Styling .................................................................................. 4 Quality .................................................................................... 5 Basic brand ........................................................................... 5 Augmented product ................................................................... 6 People .................................................................................. 6 Value .................................................................................... 6 Reputation............................................................................. 7 Promotion/representation ........................................................ 8 Developing brand ................................................................... 8 Conclusion ............................................................................... 9 Recommendations..................................................................... 9 Reference ................................................................................ 9

1. Abstract
The benefit received by the customer is shrinking as the marketers see themselves as a money making machine in an organisation. This chapter evaluates the kind of benefit the customer looks for and how does marketers helps an organisation by providing core benefit to customers. Several journals and case studies have been referred to analyse the customer behaviour as a recipient of core benefit. The authoritative knowledge of marketing management by Kotler and Kellers technique of marketing is considered while evaluating the core benefit to the customer. The finding of the essay helped in analysing the core benefit received by the customer through various options.

2. Introduction
The customer is the foundation of a business and keeps it in existence says Drucker (1973). The satisfaction of customer through the benefit it receives from the product is the main goal of a business. There are many ways through which core benefit is provided to the customer. It begins with the basic make of the product to the reputation it has on the market. Therefore, the business has to study the market trend as well as the need of the customer. The customer reaction to the benefit they received has direct impact on the business. Therefore, the core benefit given to the customer is thoroughly analysed through the market offerings such as core product, tangible product and augmented product.

3. Core product
a. Focus of the company
The prime focus of the company is to establish a product which gives maximum benefit to the customer. It does not solely depend upon its sales figures to predict the companys growth but by recognising the amount of benefit it has passed on to the customer through its product. Kotler and Keller (2009) points out the example of Procter & Gamble which analyses the customer need by identifying its prospective customers, suppliers, retailers and other institutions of the company to investigate their needs. They have produced almost 100 new products during the next two years which were highly satisfied by the customers. Organisation implement the inside-out method of producing product of their like and give out to the market, expecting the customers to accept it (Kothari and Lackner, 2006). This will have serious impact on the stability of the company as well as the benefit received by the customers. The market leaders can apply the inside-out approach where the customers will accept any product produced the company. Apple produces 2

new technological gadgets and forces the market to follow the trend. This leads the customers to accept the product irrespective of the need.

4. Tangible product
a. Features
According to Kotler and Keller (2009, p.13), a product is anything that can be offered to a market to satisfy a want or need, including physical goods, services, experiences, events, persons, places, properties, organisations, information and ideas. The ideal product is produced as per the need of the customer which in turn provides benefit to them. The feature of the product includes the benefits and value the customer gets by using the product. The benefit received by the customer determines whether the customer requires a product or not. Noad and Rogers (2008) has contradicted to the benefit received to the customer by saying that the display of the products in retail shop creates an impulse which attracts the customer to buy product irrespective of the need.

b. Packaging
An effective packing will describe the feature of the product and attract the customers confidence towards the product. Packaging is the process of designing and producing a products container (Kotler and Keller, 2009). Many marketers consider packing of a product as an element of strategy in the organisation. Effective packing represents the quality of the product and recognises the brand image of the company. The packing helps customer to identify the brand, convey product features and aid in the consumption of the product. Labelling is another way of helping the customer to identify the brand or the product. Beneficial information such as nutritional facts of a product helps the customer to receive the utility to its maximum. The assurance of a product given to the customer through warranties or guarantees helps them to reduce their perceived risk. It gives them a sense of safety and also builds the brand value in the market. Kotler and Keller (2009) supports by saying that it gives the product an edge over the competitors if it is not well known for its superior quality.

c. Process
The process of distributing the products through proper channel and with effective communication with the customer provides them core benefit. According to Ferdows et al. (2004) the Spanish retailer Zara has been successful in designing, producing and delivering the garments in just 15 days to the market which adds to the customer benefit. This helps the customer in getting the latest fashionable dress in very short span of time 3

in the retail stores. It increases the customers access to new product in a very convenient manner through proper distribution channel. Zaras secret involves the quick exchange of information from the customer to the designer through successful supply chain management. It ultimately provides the core benefit of self satisfaction to the customer, when they can find new fashionable products in the market in short span of time.

d. Price
Price of a product is an element in categorising the type of customers. Kothari and Lackner (2006) reminds about the price buyers and value buyers. Value buyers exhibit loyalty to the brand of the product. They provide an example of polyethylene manufacturer who sells bag to plastic bag manufacturer and food packing company. The plastic bag manufacturer bargains for better price to get the polyethylene, whereas food packing company will prioritise on the quality of the product rather than the price. Thus price of a product has different benefit as per the core need of a customer. Henneberg et al., (2006) supports the long term relationship with customers which help in providing quality service. The Arab Engineering Company limited does the price comparison with the quality and delivery of the product. The company had an option of getting the product for cheaper from other supplier than the usual ones. But the regular customer had long term relationship with the company as well as it provides the product in less time compared to other cheaper options. Thus, pricing should not be the sole criteria in providing a product. It should be about the benefit it gives to the customer on the basis of quality, delivery and of course the worth of the product on the price. Customer profitability is where the customer gets the benefit through the life of a product. A customer is profited when it yields revenue that exceeds the companys cost for selling or servicing the product (Kotler and Keller, 2009). Thus the customer receives the product in the form of benefit provider rather than a material.

e. Styling
Value can be received by a customer in the form style it pursues from the market. According to Hurley (2011) Emmetts shirt is the best example which provides style to the product. All of Emmetts shirt designs was limited to just 25 and made sure it gives style and value to the customer. The core benefit is the limited number of product availability. The customer feels confident of the shirt they wear and it is not replicated elsewhere.

Styling plays a major role in giving benefit to the customer. It adds to the customer satisfaction by keeping the product worth to the price and maintaining its uniqueness in the market. Customers are motivated by desire, style and prestige (Debra, 2007). They look for the best style and will research the competition prior to shopping adds Debra (2007) Noad and Rogers (2008), supports Debra about customers research and suggest improving atmospherics in the retail marketing will have positive impact on the benefit of the customer.

f. Quality
Quality is delivered when it exceeds the expectation of the customer. Kotler and Keller (2009) compares Lexus car with Hyundai regarding performance quality. Both the customers were satisfied by the product, but the performance of Lexus was beyond their expectation. Here customer has been delivered and benefited quality rather than a car. Paperwork plc is a company which produces low grade forms of paper recycled material. But the company later realised that their customers seeks high quality products from their company out of the recycled products. That is where company explored the opportunity to provide high quality product benefit. Customer does not require product they want utility or benefit in their life through the product.

g. Basic brand
According to Kotler and Keller (2009), positioning of brand affects the customer acceptance. They support the fact by giving an example of Holiday Inn serving both high end customers as well as the middle class in their product line. A customer identifies the brand by their past experience with the product by checking whether it satisfied them or not. Guo (2002) supports it by saying that existing customers provides information of the benefit in the form of opinion, suggestions etc to the new customers. The ability of a brand to simplify the decision process and to reduce risk is invaluable (Kotler and Keller, 2009). The important factor about basic brand is to understand the customers brand knowledge as it helps in maintaining the brand value in the market. Gilmore and Pine (2002) suggest about the customer experience through the success of The American Girl where the family (customers) spending lot of time in the theatre, experiencing different benefits like dining, photo shoot, hair salon etc. It gives more customer friendly products than they had it in a store. Market orientation means customer satisfaction and loyalty (Guo, 2002)

5. Augmented product
a. People
Customer relationship helps in maximising the value as well as to provide customized service or programs, based on the customer information. This helps in reducing the customer defection and enhancing potential customer growth (Kotler and Keller, 2009). Tesco uses customer database in the form of Clubcard to facilitate customers and to build good relationships with them. Long term customer relationship helps the company to gain more profit by sales as well as by reducing the cost of advertisement for getting new customers. They bring in new customers through word of mouth. It is one way of promotion or representation of the company or the product Listening and interacting with the customers helps to communicate comfortably regarding the product, service and also any up gradation required on the product. Chicken of the sea by Thai Union International is very good example of good customer relations with its 80,000 Mermaid club members (Kotler and Keller, 2009). Caterpillar is another example of providing benefit to the customer in the form of product reliability, service, personnel and image (Kotler and Keller, 2009). Customer benefit value includes value received in the form of product, service, personnel and image. Value of a product to the customer has direct relations with the customers loyalty towards the product. The brand equity has emphasized on the customer loyalty towards the product (Kotler and Keller, 2009). This creates a long term relationship with the customer as well as with the company or the products. Nevertheless, both the customer as well as the company benefit from the long term relationship in the form of value and revenue respectively. Kotler and Keller (2009) suggest about customer equity which reflects the brand equity as a lifetime value for the customer.

b. Value
Matthews and Lawley(2006) suggest about providing greater values to customers through availability of information and potential response which in turn makes them highly satisfied. The brand value forces the customer to buy the product again and again as they are buying the value through the product, irrespective of the situational influence. Kothari and Lackner (2006) suggest that organisation should adopt a customer value based approach based on the need of the hour. Wycombe medical is in the business of improving the living standard of the ostomates around the world. It speaks beyond the quality of the 6

product to how beneficial is the product to the customer. Wycombe medical produces colostomy bag using advanced technology, but ultimately they are in the market to improve the living standard of the people who are suffering from the particular health problem. The service given to the customer is one of the main areas where they receive benefit of the product. Sizzle software solution produces the best software in the market which is technologically advanced. But it was not customer friendly and it involves lot of complication. They were not provided with a customer service which was easily understandable to a foreman. It was more of inside-out approach where the company produce high end product and expect the customers to accept and use it. They were denied the benefit they were supposed to receive on the product. This did not work for the company and at the end of the day it is the customer who is the boss. The benefit of the product does not end by the sale of the product. It is benefited only when the customer uses the product. Thus the benefit providers should be able to assist the customers if they have any problem while using the product through service, replacement, repair, suggestions etc. It improves the value of the product to the customer as well as the company.

c. Reputation
Reputation of a product or a company gives added advantage to the customer in selecting the appropriate product from the market. It speaks of the benefit it provides to the customer out of the reputation it has maintained in the market. According to Masterson and Pickton (2004) Jordan the founder of Auto-Tecnic limited has recognised the core benefit that customers seek in the electronic system. Jordan was able to add value to the existing product by incorporating extra security features to the automated garage doors. Jordans strategy was to maintain the reputation of the company by improving the electronic design and product development. This helped Auto-Tecnic to increase the brand value in the market by improving its efficiency and by providing the apt benefit to the customers. Anderson Marine construction limited is another example of providing the core benefit to the customer by capitalising on its reputation rather than degrading its brand value by cutting down the prices. It developed smaller boats with lower cost and customised the products based on the likes of the customer. The company has also decided to increase the stock so that the clients need not wait for longer period for delivery. This provides extra benefit to the customer as well as improves the reputation of the company by delivering products on time. And finally, Robertson (2010) was disappointed by the service from a highly reputed firm like NHS. The loyal customers expect more 7

professional service from highly reputed organisation like NHS. In this case, the customer or patient was not able to receive the kind of benefit expected. The benefit for the patient is care in the form of professional treatment. The inefficiency to provide the benefit to the customer will have severe effect on the organisation. It degrades the reputation and questions the quality of benefit provided to the customers.

d. Promotion/representation
Chalfont Duvets Ltd of Manchester has done the promotion of duvets and duvet covers by including its sales coverage to the furniture stores. It is a way of promotion by giving commission to the sales person on every sale of duvets. It also questioned the amount of commission received by selling the duvets which cost only 50. Salesperson would be happier to sell products which are costlier in the furniture shop as it attracts more commission. But on the view of sole exclusive seller of duvets, it is the only available source to promote its product. Merchandising, advertising and campaigning are some of the tactics to create awareness and to introduce new product to customers. Kothari and Lackner (2006) provide four elements to deliver value to the customer in the form of features, availability, service and cost of the product.

e. Developing brand
Customer satisfaction helps in making the customer stay longer with the product and upgrades the product when new items are introduced in the market. Kotter and Keller (2009) reminds about difference between customer loyalty and satisfaction. The highly satisfied customer need not be loyal to the product as it happened in the research conducted by the Xeroxs executives. Kotler and Keller (2009) suggest developing a cult brand through the example of Jones Soda where the less popular product became high turnover product in the market by involving customers in the marketing process indirectly through special events and programs. The effective manipulation of customer is done by providing facilities like internet browsing that makes them spend extra time in the store (Noad and Rogers, 2008). Pulendran el al. (2003) supports that high quality marketing planning helps in providing performance benefits to the customers. Customer behaviour has direct relationship with marketing strategy of an organisation.

6. Conclusion
The essay has discussed about the core benefit passed on to the customers through sales done by the marketers in various methods. It has broadly studied the effect of benefit given to the customers and their effect on the organisations growth in sales. As Doyle (1998) rightly said, Whatever product the company produces, the customer does not want it. The customer wants to meet a need. The concept of customer buying the benefit or value through the product has been recognised at various occasions in the essay through apt examples and situations faced by various organisations. It also studied that companies should adopt the outside-in approach in the market and produces the product as per the need of the customers.

7. Recommendations
Customer perceived value is a useful framework suggested by Kotler and Keller (2009) to analyse the situation of the customer need and yield rich benefit. Understanding different set of customers helps in providing core value to the customer as well as to the organisation in the form of brand value. The company should encourage the approach of outside-in where they value the changing customer needs and produce appropriate product. Introducing innovation in the product will attract the customer to search for value in the product. Product service after the sale helps the customer to reap the benefit throughout the life cycle of the product. Maintaining quality of the product and improving the standard as and when there is technological advancement. In other words, it is about sustaining the competition in the market. Appropriate promotion and keeping up the reputation of the product through various activities helps to retain the customers as well as their loyalty. Appropriate pricing as per the value of the brand in the market and providing beneficial features in the product.

8. Reference
Anderson marine construction ltd (2011). Anderson marine construction ltd, from MKTM003. Marketing strategy. University of Northampton, on 20th October. Available from: Blackboard. [Accessed 29/01/12]. Chalfont Duvets (2011). Chalfont Duvets, from MKTM003. Management of price decision. University of Northampton, on 12th January. Available from: Blackboard. [Accessed 29/01/12]. 9

Ferdows, K. et al. (2004) Rapid Fire Fulfillment. Harvard Business Review, 82 (11). Gilmore, J. and Pine, J. (2002) Customer experience places: the new offering frontier. Strategy and leadership, 30 (4), p.4-11. Guo, C. (2002) Market Orientation and business performance: A framework for service organisation. European journal of marketing, 36 (9/12), p.1154-1163. Henneberg, S. et al. (2006) Network pictures: concept and representations. European journal of marketing, 40 (3/4), p.408-429. Hurley, J. (2011) Choosing the right time to expand a small luxury business. The daily telegraph, [online] Sunday and July. Available at: http://www.telegraph.co.uk/finance/businessclub/8647223/Choosing-theright-time-to-expand-a-small-luxury-business.html [Accessed: 13 October 2011]. Kothari, A. and Lackner, J. (2006) A value based approach to management. Journal of business & industrial marketing, 21 (4), p.243249. Kotler, P. and Keller, K. (2009) A Framework for marketing management. 4th ed. London: Pearson Education Limited. Masterful marketing (2007) Marketing in a new media world. [online] Available at: http://masterful-marketing.com/marketing-b2b-vs-b2c/ [Accessed: 24 January 2012]. Masterson, R. and Pickton, D. (2004) Marketing: an introduction. London: McGraw-Hill Education. Matthews, S. and Lawley, M. (2006) Improving customer service: issues in customer contact management. European journal of marketing, 40 (1/2), p.218-232. Noad, J. and Rogers, B. (2008) The importance of retail atmospherics in B2B retailing. International journal of retail & distribution management, 36 (12), p.1002-1014. Paperworks (2011). Paperworks Plc, from MKTM003. Marketing tactics. University of Northampton, on 15th December. Available from: Blackboard. [Accessed 29/01/12]. Pulendran, S. et al. (2003) Marketing planning, market orientation and business performance. European journal of marketing, 37 (3/4), p.476497. Robertson, M. (2010) The NHS hospital: the hell of finding myself in a hospital bed. The Daily Telegraph, [online] Tuesday and March. Available at: http://www.telegraph.co.uk/health/7401311/The-NHS-hospital-thehell-of-finding-myself-in-a-hospital-bed.html [Accessed: 22 January 2012]. 10

Sizzle (2011). Sizzle, from MKTM003. Introduction to marketing. University of Northampton, on 6th October. Available from: Blackboard. [Accessed 29/01/12]. The Arab Engineering Company (2011). The Arab Engineering Company, from MKTM003 Business to Business. University of Northampton, on 27th October. Available from: Blackboard. [Accessed 29/01/12]. Wycombe medical (2011). Wycombe medical, from MKTM003. Mission Statement. University of Northampton, on 2nd December. Available from: Blackboard. [Accessed 29/01/12].

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