Marketing Insights from A to Z: 80 Concepts Every Manager Needs to Know
by Philip Kotler
Professor Kotler covers a lot of ground quickly as he reflects on 80 marketing-related topics—the average chapter length is 2.3 pages. “My 40-year career in marketing has produced some knowledge and even a little wisdom… Zen emphasizes learning by means of meditation and direct, intuitive insights. The thoughts in this book are a result of my meditations on these fundamental marketing concepts and principles.”
In the chapter on customer satisfaction, Kotler comments on the impact of customer retention on profitability.
- “Acquiring new customers can cost 5 to 10 times more than the costs involved in satisfying and retaining current customers.
- The average company loses between 10 and 30 percent of its customers each year.
- A 5 percent reduction in the customer defection rate can increase profits by 25 to 85 percent, depending on the industry.
- The customer profit rate tends to increase over the life of the retained customers.”
“Market share is a backward-looking metric; customer satisfaction is a forward-looking metric. If customer satisfaction starts slipping, then market share will soon follow.” While Kotler points out the link between unsatisfied customers and churn, I am reminded of a related point by Oren Harari in Break from the Pack. Customer satisfaction is not an indicator of customer loyalty. “That is exactly why companies are often shocked when customers who say they’re satisfied today leave for a competitor tomorrow.”
Here are a few more of Kotler’s insights:
- “Most ads are a waste of the company’s money… The best advertising is done by your satisfied customers.”
- “The most profit comes from repeat sales.”
- “Too many companies see themselves as selling to distributors, instead of selling through them.”
- “Although most sales promotions increase sales, most lose money… Incessant prices off, coupons, deals, and premiums can devalue the brand in the customers’ minds. They can lead customers to wait for the next promotion instead of buying now.”
Kotler defines marketing in the introduction. The short version: “Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, communicating, and delivering superior customer value.”
The book is somewhat dated as it was published in 2003, but much of what Kotler focuses on are fundamental concepts. Sometimes it is useful to take a step back from the day-to-day frenzy and reflect on the bigger picture.
The 80 topics covered in the book are: advertising, brands, business-to-business marketing, change, communication and promotion, companies, competitive advantage, competitors, consultants, corporate branding, creativity, customer needs, customer orientation, customer relationship management (CRM), customers, customer satisfaction, database marketing, design, differentiation, direct mail, distribution and channels, employees, entrepreneurship, experiential marketing, financial marketing, focusing and niching, forecasting and the future, goals and objectives, growth strategies, guarantees, image and emotional marketing, implementation and control, information and analytics, innovation, intangible assets, international marketing, Internet and e-business, leadership, loyalty, management, marketing assets and resources, marketing department interfaces, marketing ethics, marketing mix, marketing plans, marketing research, marketing roles and skills, markets, media, mission, new product development, opportunity, organization, outsourcing, performance management, positioning, price, products, profits, public relations, quality, recession marketing, relationship marketing, retailers and vendors, sales force, sales force, sales promotion, segmentation, selling, service, sponsorship, strategy, success and failure, suppliers, target markets, technology, telemarketing and call centers, trends in marketing thinking and practice, value, word of mouth, and zest.
Kotler, Philip. Marketing Insights from A to Z 80 Concepts Every Manager Needs to Know. Hoboken, New Jersey: John Wiley & Sons, 2003. Buy from Amazon.com