| |
| |
|
Marketing Information |
|
|
|
Creating Customer Value
The purpose of business is to create and retain a customer. Much has been written about customer orientation, customer relationship management (CRM), Customer Lifetime Value (CLV) metrics, Customer Centric organization models, customer retention, customer care?add any high sounding word with 'customer' preceding or succeeding that word and you have a new model, a new theory. Headline hitting books, celebrity author seminars and training till another theory comes along. And we see the poor customer is still the most dissatisfied lot (that includes all of us specialists too, as customers). What a manufacturer or service provider often thinks as a market or value proposition, customers respond in a diametrically different fashion. Why does it happen? While business thinks in terms of products and derived values, customer is looking at satisfaction. The key question is whether all the strategy, product features, add ons and value creation lead to ultimate customer satisfaction. Now this may seem a little contradictory. To illustrate it better let's take the example of Cell phone services. Companies are rolling out a new product every fortnight offering more value, in their perspective. Then the point is why does the customer keep switching over to different service providers and products or packages so often, if the products are offering value. The key here is more value propositions are being rolled out without looking at the very basic. Whether the value proposed gives satisfaction to the customers. If not it is not valuable. The customer is buying satisfaction. Highest value is derived when the customer is fully satisfied with his purchase. Some common myths in Value Creation Myth # 1 More is often considered value Buy one get one free schemes are rolled out. There is of course an instant sales push. However at the end of the scheme the customer feels that he had all along been paying 100% more for the products and perceives that very product as costly once the scheme is withdrawn. May switch to another product at the same price. Conclusion: Dissatisfaction leads to value erosion Myth # 2 Price is value Many business considers lower price as offering more value. More often than not lowest price products end up as the second best with a higher priced product with similar product attributes leading the market. The simple reason is the higher price product may be offering a higher satisfaction due to perceived values and imagery. Car markets are a prime example of this syndrome. Myth # 3 More Features or add ons are value Businesses load a product or service with more features thus offering a higher value. While this may be attractive if the features are not backed by adequate supports the satisfaction may be less and value is reduced. We encounter this everyday. A customer buys a product with many features but not demonstrated properly or may not be serviced properly. Enquiries may not be handled effectively. Airlines offereing add ons like free overnite accomodation are still not favored if the services, like enquiry handling, reservations, and time schedules are poor. Cell phones companies may be offering plenty of add ons like national roaming or free incoming calls etc. However if the billing is poor and billing enquiries are not addressed properly the customer is dissatisfied and leaves the service for another provider. Myth # 4 Products are competing with similar products This is often true in the leisure industry. A movie theatre may not be competing with another movie theatre. If the customer is not satisfied with a theatre or movie he may look at options to other entertainment sources, for instance an amusement park. We may call them discretionary time products. Highest satisfaction levels are very important in this type of business. These are some of the examples of how businesses can go totally wrong in assessing value. While it is all good to talk of value creation some thought must go into the majoe ingredient in value that is the customer satisfaction. And are business really serious about customer retention. As even a novice to business knows it is far cheaper to service and retain existing customers. The cost of acquiring new customer is very high. Now how many business have consumer satisfaction index to monitor this prime factor in customer value creation About The Author R.G. Srinivasan is founder of Born To Win Forum. He is a certified trainer and consultant in training design & methodologies, focused on personal effectiveness and motivational training. He is also the author of ebooks, publishes 2 ezines on success and motivation and Home Business with an international circulation. His articles are published in more than 50 portals and websites across the world. He is featured as an Expert Author in Ezinearticles.com. Check out his home business ezine at http://home-businessleaders.tripod.com.
MORE RESOURCES:
Google News |
|
|
|
RELATED ARTICLES
Directional (Not Direct) Marketing Those who believe the web is not a direct response medium should think again. A recent study conducted by AdKnowledge and published in their recent "Online Advertising Report" suggests that 60 percent of total website conversions occurs in the first half-hour. SMS for the Estate Agent - Targeted Marketing Tool, or Legal Minefield? Imagine having at your disposal a means to immediately inform house buyers that you have just the property they are looking for. Potential buyers have given their details and their preferences - imagine that you can send them this information no matter where they are or what they are doing, they can read it at a time that's convenient and can act accordingly in their own time. How To Go From Under Dog to Top Dog by Unleashing The Power Of a Postcard The Tale of Two Dentists.. 10 Reasons Why Businesses Fail at Marketing. 1) They don't fully understand it.Perception: Marketing is advertising. Quick Postcard Design Tips TIP #1: Avoid the "Too Much Information" Syndrome I've seen many a marketing postcard that just has too much information on it. Too many words set in tiny type is an all too common problem. Design Direct Mail Postcards Back-to-Front to Boost Response Rates Conventional wisdom says that the front of a direct mail postcard is for the picture and the back is for the address, stamp and a short message.But some savvy direct marketers design their postcards the other way around-and boost response rates as a result. CRM System: Give Meaning to Your Data A customer relationship system (CRM) system uses technologically-driven strategies to assess customer needs and buying behavior. This allows businesses to market their products and services more effectively. Marketing is More Than a Token Process "Necessity is the mother of invention!" The first time I heard this was nearly twenty years ago when I was introduced to Tony Robbins' material. I was listening to, and applying, information from his thirty day series. Give me a Referral any Day - the Power of Networking I nearly panicked recently! Well, maybe a slight exaggeration but here was a situation I had not been in for some time. The freezer had broken down and the dilemma I faced was - a speedy solution was necessary BUT I did not know anybody who repairs freezers. The Battle of Positioning -- Altruism or Paranoia? Competition in the past has embodied such beliefs of "kill or get killed" which has fostered paranoia with many individuals and companies. Our competitive thinking has been to: defend, hoard, knock off competition, defame and win at any cost. A Seven Letter Word That Helped a 3 Month Marketing Newbie to Online Success Who would have thought that a three month newbie and marketing dummy with no list, no product, no contacts, can actually make money online? Me neither.I had no idea what to do, how to do or why. 6 MUST Have Strategies To Make Big Bucks with Big Ticket Items Strategy #1: Change Your Mindset That's right, change your mindset! It's probably the number one most important strategy when selling Big Ticket Items. Plenty of people are uncomfortable selling items that are priced above the $500 - $1000 mark. 25 Ways To Get More Business Special Requirements for Reprint: we ask only that you include Pauls name and resource box, and keep all hyperlinks as live links. Complete Article with Resource Box at end: Need more business? Who doesnt? Thankfully, new business is pretty easy to get, but you do have to do something to get it. Seven Secrets For Building Customer Loyalty In Your Restaurant Imagine how much your sales and profits would increase if each of your customers come back just one more time a week or a month. You would boost your sales by 50%. In Sickness And In Health I recently drove by a business that had a sign out front that read "Closed due to illness". This meant that the cash flow would stop until the owner was able to return to work. D.A.N.C.E. With Me Recently, a client asked what he could do to help my business, but I wasn't ready with the answer. A lot of us probably miss these opportunities because we don't think through what we need and how to respond when someone offers to help promote us. Five Mistakes Absolutely Guaranteed to Drive Away Your Best Clients We all work hard to attract even one paying client. In fact, we work hard to attract serious inquiries. Does Your Marketing Pass This 10-Point Test? Good marketing, whatever form it takes, always meets certain criteria. That's what makes it good. Features vs. Benefits vs. End Results If you've been in the copywriting realm for very long at all, you've heard the phrase "features vs. benefits. Your Elevator Speech - Have You Updated Yours Recently? Do you have an elevator speech? Does it get people's attention? Do they ask you lots of questions when you tell them what you do?Every great elevator speech needs to answer these key questions:1. Who am I? (introduce yourself)2.
|
| home | site map |
| © 2006 |
