paradigm shift in marketing

7/29/2019 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.


5/16

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.


6/16

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


7/16

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

paradigm shift in marketing

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