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Enterprise Strategy/AW/08

            Arj Wignaraja
It is better to focus resources on getting new business from
      existing customers, than in finding new customers
1. Customer                   4. Recruitment
                Markets                         Markets




        2. Referral          Relationship         5. Influence
         Markets              Marketing             Markets




               3. Supplier                    6. Internal
                Markets                        Markets



It is the job of marketing to help all divisions to adopt a marketing
orientation toward both its internal and external customers.
1. Analyse customer     2. Calculate annual
    base & divide into      revenues earned
    segments                from customer
                            segments



  3. Calculate annual    4. Identify & retain
     costs of serving       quality customers
     the segments


5. Eliminate or re-
   engineer the
   unprofitable
   customer groups
The value of the      The probability
                   customer account,     that the original
                   derived from each     purchaser will later
                   of the purchases it   buy each of the
                   may undertake in      additional products
                   the future




                                          The initial
The value of                              costs of
the customer       The probability of     attracting the
account,           retaining the          customer
derived from its   customer after the
original           original purchase,
purchases          and into the future
New businesses



Industry structure



IT/IS as a competitive
      advantage
E-business




                     Integrated
                     e-commerce
        E-commerce


Web presence
Delivery to

                 Business           Consumer


      Business      B2B                 B2C




Exchange
Initiated by
                   C2B                  C2C



     Consumer
08 e3 customer management & e business-lecture notes

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08 e3 customer management & e business-lecture notes

  • 2. It is better to focus resources on getting new business from existing customers, than in finding new customers
  • 3. 1. Customer 4. Recruitment Markets Markets 2. Referral Relationship 5. Influence Markets Marketing Markets 3. Supplier 6. Internal Markets Markets It is the job of marketing to help all divisions to adopt a marketing orientation toward both its internal and external customers.
  • 4.
  • 5. 1. Analyse customer 2. Calculate annual base & divide into revenues earned segments from customer segments 3. Calculate annual 4. Identify & retain costs of serving quality customers the segments 5. Eliminate or re- engineer the unprofitable customer groups
  • 6. The value of the The probability customer account, that the original derived from each purchaser will later of the purchases it buy each of the may undertake in additional products the future The initial The value of costs of the customer The probability of attracting the account, retaining the customer derived from its customer after the original original purchase, purchases and into the future
  • 7. New businesses Industry structure IT/IS as a competitive advantage
  • 8. E-business Integrated e-commerce E-commerce Web presence
  • 9. Delivery to Business Consumer Business B2B B2C Exchange Initiated by C2B C2C Consumer

Notes de l'éditeur

  1. Customer markets:These are the buyers of the final product and they remain the final goal of marketing activity. To be able to deliver superior customer value in increasingly competitive industries, modern relationship marketing emphasises the importance of having appropriate relations with other interfaces.Referral markets: Referral markets are the institutions and individuals who refer the customer to us. This could include banks, agents as well as existing customers. Therefore cultivating relationships with these intermediaries is critical to getting new customers.Supplier markets: Partnerships with suppliers must replace traditional adversarial relations if the firm is to better meet the needs of the final customer. This can include collaboration to improve quality, set up JIT arrangements or to work together in harnessing product innovations. Marketing must sell new attitudes essential to these partnerships.Recruitment markets:To provide good service to customers, it is essential that the firm has good staff. However in a competitive market the good-calibre staff member also has a choice. Marketing should build up appropriate relationships with the stakeholders in the recruitment markets (agencies, careers advisers, head-hunters, etc.), as well as ensuring that the corporate image of the firm is appealing to would-be recruits (e.g. through the design of corporate literature and selective sponsorship).Influence markets:Influence markets are institutions that can influence what customers will purchase. For example an aeroplane manufacturer will need to influence national governments as well as airlines of the safety of its products. Other examples include pressure groups, brokers, analysts, consumer associations, etc. This influence of marketing often occurs under the heading of public relations or lobbying activities.6. Internal markets: Internal markets have two aspects to them:Each internal department is the customer of some and a supplier to the rest. For the firm to operate smoothly it is important that a client service ethos pervades all departments and replaces divisional rivalries and loyalties.Each division should interpret what it does in terms of how it serves the customer. You may recognise this view as the third pillar of Kotler's version of the marketing concept.
  2. Customer account profitability (CAP) analysis takes the single-period view of the value of the customer.A UK clearing bank recently revealed that 20 per cent of its customers generated 120 per cent of its profits. Put another way, 80 per cent of its customers are unprofitable and reducing its profits by 20 per cent! Using CAP analysis would reveal which customers this 80 per cent are (and who the 20 per cent are too). SEE ATTACHED NOTE ON CAP