Download - Paradigm Shift in Marketing
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Paradigm Shift in Marketing
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Paradigm Shifts in Marketing
Paradigm Shift: Shift from transactions to
relationship focus with emphasis on customer
relationships and formation and management of
strategic alliances
Fundamental Requirements:
Focus on customer driven marketing practices
Focus on profitability
Focus on strategic marketing practices
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Three Requirements
a) Focus on customer driven marketing practice:Innovation and customer oriented business
decisions
b) Focus on profitability: On value rather thansales volume.
c) Focus on strategic marketing practices:STP.
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Competitive advantage through
Relationship Marketing
Relationship Marketing : Attracting ,maintain,and in multiservice organization ,enhancing the
customer and relationships,thus increasing
loyalty of profitable customers. As in information era ,business reengineering
,automation ,downsizing ,financial restructuring
,efficient fund reduced manpower and financialcost.
RM is having potential to improve productivity
through efficiencies and effectiveness.
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Continued.
IT development, data warehousing, data mining
have made possible to maintain 1-1 relationship. Also through personnel management, call
centres,interactive voice ,online dial up
connections ,websites. These help to gain info about customer needs
and buying behavior to design and develop
services.
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RM and Consumer Markets
Consumer like to reduce choices by engaging
ongoing loyalty relationship with marketers.
Form of commitment made by consumers to
patronize selected products, services and
marketers rather than options.
Regarding productBrand loyalty and brand
equity
Regarding ServiceIf services and provider are
inseparable. Like Healthcare and doctors
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Continued..
To achieve greater efficiency in decision
making to reduce information processing to
achieve cognitive consistency and to reduce
perceived risks associated with future choices.
Engage as norms set by family, peer
groups,govt. mandates, religious tenets,
employer influence and marketer induced
policies
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RM and Industrial Markets Business Market:Long selling cycles,diff sets of
deccision makers & influencers
E-commerce,Electronic Market Places
Info and documentation
Vendor comparisonDay to day trading to reduce inventory
For Commodity : Low value and little differnce,hence
open market purchase
For top customers: Rising customer acquisition
cost,maturing markets commoditisation and lower vendor
to focus on building loyalty as to develop long term
relationship with customers
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CRM Concepts
Focusing on key customers and building strong
relationships Proactively generate high level of customer satisfaction
with interaction with customer.
Anticipate customers need by careful study of
environment ,customer processes and behavior .
Building closer ties with customer, sometimes by
integrating systems
Crafting value perception for customer. The customersee relationship with vendor as something that brings
value and adds competitive advantage.
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KAM as important part of CRM in B2B Marketing
Key Account : Profit, prestige ,reference value,
permit access to new markets and technologiesand might be a small or large org or operating
locally or globally.
a) KAM for customer segmentation: Growth in profits as compared to growth in sales
Characteristics of Key account
Cost of servicing each customer vis--viscontribution
Impact of losing key account on bottom line of the
firm
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Continued.
b) Customer Retention Strategy: Building
customer loyalty and higher level of
satisfaction.
c) Growth and Development Strategy: Building
KAM ,is to combine customer retention with
building customer share.
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CRM and Growth of Services Marketing
Telecom Sector
Airlines Industry
Retail Industry
Financial Services
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Evolution of Marketing Theorya) Self Sufficiency stage
b) Simple Barter stage
c) The local Markets stage
d) Money Economy stage
e) Early Capitalism stagef) Production Oriented stage
g) Sales Oriented stage
h) Marketing Oriented stagei) Consumer Oriented stage
j) Society oriented stage
k) Management Oriented stage
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Transactional /Relationship Marketing
Transactional Marketing Approach
Orientation to single sales Discontinuous customer contact
Focus on product features
Reducing price based onsensitivity analysis with right
promotional measure
No measures to build the on-going business
After sales support is poor as it isseen as cost
Do the deal and disappear
Adding new customers with theexisting customer
Limited emphasis on customerservice
Relationship Marketing Philosophy
Orientation to customer retention Continuous customer contact
Focus on customer value
Promotes value and explain thebenefits
Measures like membership, clubslike frequent flyer to build on thegoing business
After Sales support is excellent,as it is seen as investment
Negotiate win-win and stayaround to benefit later on fromthe same customer in terms ofrevenue and profitability
Data mining to develop andenhance relationship
High emphasis on customerservice
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4 Ps of Marketing Mix
a) Product Mix
b) Price Mix
c) Place Mix
d) Promotion Mix
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Extended Ps of Marketing Mix
People
Process
Physical Evidence