CustomerValueandCustomerRelationshipsCustomerValueMarketinginvolvessatisfyingcustomers’needsandwants;thetaskofanybusinessistodelivercustomervalueataprofit.CustomerValueTheValueCreationandDeliverySequence:thethreemajorsteps•ChoosetheValue•ProvidetheValue•CommunicatetheValueCustomerValueChoosetheValue:Activities•Customersegmentation•Marketselection/focus•ValuepositioningOftenreferredtoasStrategicMarketing.CustomerValueProvidetheValue:Activities•Productdevelopment•Servicedevelopment•Pricing•SourcingandMaking•DistributingandServicingOftenreferredtoasapartofTacticalMarketing.CustomerValueCommunicatetheValue:Activities•Salesforce•Salespromotion•AdvertisingOftenreferredtoasapartofTacticalMarketing.CustomerValueChoosetheValue:HelpfulConceptsSTP:Segmentation,Targeting,Positioning(factorstoconsiderbeforetheproductexists,somecallittheessenceofstrategicmarketing)3Vs:ValueSegment,ValueProposition,ValueNetwork(KumarofLSB)CustomerValueDefiningValueandSatisfaction:Customersalwaysseektogainthegreatestbenefitattheleastcost.CustomerValueDefiningValueandSatisfaction:KeyConceptsCustomerPerceivedValue(CPV):customer’sevaluationofallofthebenefitsandcostsofanoffering.TotalCustomerBenefit:perceivedmonetaryvalueofallofthebenefitsacustomerexpectsfromanoffering.TotalCustomerCost:perceivedbundleofcostsacustomerexpectstoincurfromanoffering.CustomerValueTotalCustomerCost:•Monetarycost•Timecost•Energycost•PsychiccostTotalCustomerBenefit:•Productvalue•Servicesvalue•Personalvalue•ImagevalueCustomerValueStepsinCustomerValueAnalysis:1.Identifythemajorattributesandbenefitsthatcustomersvalue.2.Assessthequantitativeimportanceofthedifferentattributesandbenefits.3.Assessthecompany’sandcompetitors’performancesonthedifferentcustomervaluesagainsttheirratedimportance.4.Examinehowcustomersinaspecificsegmentratethecompany’sperformanceagainstaspecificmajorcompetitoronanindividualattributeorbenefitbasis.5.Monitorcustomervaluesovertime.CustomerValueAnotherimportantactivityiscultivatingcustomerloyalty.Loyalty:deeplyheldcommitmenttore-buyorre-patronizeapreferredproductorserviceinthefuturedespitesituationalinfluencesand/orcompetitors’marketingeffortstoenticeswitching.Thekeytocultivatingloyaltyis“deliveringhighcustomervalue”.CustomerValueConceptstoremember:Valueproposition:thewholeclusterbenefitsthecompanypromisestodeliver.Valuedeliversystem:alloftheexperiencesthecustomerwillhaveonthewaytoobtainingandusingtheproductorservice.CustomerValueCustomersatisfactionisimportanttoo!Satisfactionisdeterminedbywhethertheproduct/service’sperformancemeetsorsurpassesexpectations.CustomerValueFactorsthatshapecustomerexpectations:•Pastbuyingexperiences•Friends’andassociates’advice•Marketers’andcompetitors’informationandpromisesIfyouraiseexpectationstoohigh,thecustomerislikelytobedisappointed.Ifyousetexpectationstoolow,customersmayignoreyourproduct/service.CustomerValueSatisfactionalsodependsonquality.Quality:thetotalityoffeaturesandcharacteristicsofaproduct/service.CustomerValueMarketers’sixrolesinhelpingdefineanddeliverhighqualitytocustomers:1.Bearthemajorresponsibilityforcorrectlyidentifyingthecustomers’needsandrequirements.2.Communicatecustomerexpectationsproperlytoproduct/servicedesigners.3.Makesurethatcustomers’ordersarefilledcorrectlyandontime.4.Ensurethatcustomersreceivetheproperinstructions,training,technicalassistanceintheuseoftheproduct/service.5.Stayintouchwithcustomersafterthesaletoensuretheirsatisfaction.6.Gathercustomerideasforproduct/serviceimprovementsanddeliverthemtotheproperdepartments.CustomerValueYoushouldmeasurecustomersatisfactionregularly.Satisfactionandloyaltytendtobelinked.Highsatisfactionoftencreatesanemotionalbondwiththeproduct/service.CustomerRelationshipsMaximizingvalueofyourcustomersmeanscreatingandcultivatinglongtermcustomerrelationships.Instillingloyaltyinyourcustomersisthekey.CustomerRelationshipsTheFiveLevelsofRelationshipMarketing:•Basicmarketing:sellingtheproduct/service(mostcommon).•Reactivemarketing:sellingtheproduct/serviceandencouragingcustomerstoofferquestions,comments,orcomplaints.•Accountablemarketing:followingupafterthesaletoseewhethertheproduct/servicemeetsexpectationsandaskforimprovementsuggestionsandspecificdisappointments.•Proactivemarketing:contractingcustomersperiodicallywithsuggestionsaboutnewproduct/serviceusesornewproducts/services.•Partnershipmarketing:workingcontinuouslywithcustomerstofindwaystoperformbetter.CustomerRelationshipsCustomer/distributornumbers,margin,andmarketingrelationship:usualrelationshipHighMarginMediumMarginLowMarginManycustomers/distributorsAccountableReactiveBasic/ReactiveMedium#ofcustomers/distributorsProactiveAccountableReactiveFewcustomers/distributorsPartnershipProactiveAccountableCustomerRelationshipsCustomerRelationshipManagement(CRM):Theprocessofmanagingdetailedinformationaboutindividualcustomersandcarefullymanagingallcustomer“touchpoints”tomaximizecustomerloyalty.CustomerTouchPoint:anyoccasionwhenthecustomerencountersthebrandandproduct/service.CustomerRelationshipsCRMmarketingcanemploymanytechniq