Assignment no: 1 Q) What are the areas you would concentrate to 'sustain customer relationships'?

What are the strategic issues to be considered? How would you deliver superior value resulting into pursuing continuity and growth A) The most important thing in sales and marketing is to attract and retain your most profitable business customers. In order to accomplish this feat, you must devise and implement a customer strategy that builds, fosters, nurtures and extends relationships with your customers. Your company profits only when the earnings from retained customers exceed the costs to acquire and to service customers over time. There is a strong correlation between long-term business success and long-term customer relationships. Successful businesses capitalize on every stage of the customer life cycle from customer selection, to customer acquisition, customer retention, and customer growth. Once a certain level of trust and comfort has been established, most customers prefer to remain loyal to companies and their products. Customer selection and acquisition is just the beginning of the customer relationship life cycle. Ideally, your company should target only high value and low attrition-risk prospects. The cost to acquire a new customer is much greater than the cost to retain an existing customer. Depending on the industry, experts indicate that it is five to ten times more costly to acquire a new customer than it is to keep and develop an existing customer. In the retention stage of the customer’s life cycle, a company retains its customers by delivering on its value proposition. This ensures that the customer needs to look no further; that is the rationale for providing the highest-quality of service. When your customer relationship is based on trust, cooperation and collaboration, the customer is more willing to listen to your new ideas, try your new products/ services, and considers you as a long term, trusted partner. A savvy business owner/executive understands that it pays to nurture existing customer relationships. If a good working relationship has been established, then it is easier to upsell and cross-sell your products/services to this existing customer. If your customer’s

promote goods and services. including prospecting. and pilots. newsletters. In other words. capture. is growing. is imperative. Customer growth strategies generally focus on increasing the share of each customer's expenditures by expanding its company's range of products/services. then the future growth of your company could be in jeopardy. • Insight: Research your customers’ markets. Creating and managing this balance can be a major challenge to management. sales. be cautious that the growth in purchases by. • Involvement: Engage customers in product development /enhancement. Many organizations think in terms of the "lifetime value" of a customer. and act on your customer’s input. focus groups. and goals. • Feedback: Ask for. however. So. increasing the value of each existing customer is the ultimate objective. . Striking this balance. if your company becomes too dependent on any one or only a few existing customers. and surveys: Provide product/service updates. Customer Relationship Management (CRM) applications offer solutions to this challenge. In the growth stage of the customer’s life cycle. • Be accessible: Make it easy for customers to reach you • Customer satisfaction: Implement a customer satisfaction policy that provides a way to resolve/remedy problems and issues. CRM is the process of tracking and managing all aspects of a company’s interaction with its customers. It is crucial. However. not to lose sight of the importance of continually acquiring new customers. Here are just a few customer touch points that you can use to strengthen your relationships and keep your customers informed and engaged: • Email messages. • Customer loyalty: Implement loyalty. • Relationship building: Talk and listen to customers in order to maintain a dialogue and to build a trust based relationship. affinity. there is a good possibility that there will be an increased need for your products/services. and rewards programs. and communicate news/events. and service. via beta tests. between servicing existing customers and acquiring new customers. one or a few customers does not represent too large of a proportion of your company’s total sales.

then the brand is not relevant to me).” etc. “makes me feel accomplished”. or anticipate having. However. .• Anticipate customer needs: Learn their business. it suggests that the product is something needed. even the commodity that seems to differ from competitors' offerings only in price. Relevance is a big word and has many implications. something that will be a solution to a need. advice. accessibility (if I can’t access the product. it is likely that the brand itself is not relevant. In the first instance. remember to value the “personal touch. Establishing personal bonds goes a long way toward building lasting relationships. when and where I need it. relevance goes further to encompass aspects of affordability (“generally speaking products under this brand’s mark cost more than I can afford. • Become an indispensable resource: Look for ways to add value. Assignment no: 2 Q) Any product or service can be differentiated. Explain It is not overly simplistic to say that there are two predictive components of strong brands: relevance and differentiation.” You will be surprised at how much you may have in common. and higher order relevance interpretations which come from emotional brand attributes such as “for people like me”. and to help your customers achieve results. and their requirements for effective proactive solutions. it is not overly simplistic to think of a strong brand as one that will support a premium price in the marketplace – where the brand itself adds economic value to the product or service. “a brand I trust. from a business point of view. And again. and if I can’t afford their products or services. In building customer relationships.” Make an effort to get to know your customer “as a person. to be a real partner. their purchasing patterns. service. if the products or services under the brand trustmark do nothing to address or solve specific needs consumers have. • Help lines: Provide support. In this sense. then again it is not relevant). physically. and information.

can be overridden by price). in the end. There are already very few categories in which each segment is not populated by a large variety of competing products that are differentiated from a functional standpoint in only the most minute ways (the automobile category being a classic example of this. we have seen how consumers reject traditional discriminating benefits in favour of lower prices. and other higher level positional attributes. . Price matters In spite of what they say. In fact. Motivational differences are difficult to sustain – for the most part products and services can be replicated either exactly or “exactly enough” to render uniqueness impossible. that make products under this brand mark preferable to equivalent products under another marque. there are very few products that somebody cannot copy (differentiation) and sell for a little less (relevance). The implications of this understanding is that (in most cases) products are forced into a price fight with challengers. wherein differentiation is focused on unsubstantial discriminating benefits that. where this is not the case yet. but also wrapped in a more motivating value proposition (rendering existing differentiating attributes less potent). Furthermore. And. and that this paradigm will remain true as long as the marketing focus remains on the product and its inherent features and attributes (including benefits). That said. and create positional constructs in which they are intrinsically and extrinsically rewarded for taking the “cheaper copy” option. such as trust. the relative ease of entry into most marketplaces means that products and services can not only be duplicated. it is becoming increasingly difficult to maintain exclusive relevance and meaningful differentiation in the marketplace today. prestige. it soon will be: in reality.Differentiation determines whether there are meaningful motivational differences (functional and physical attributes inherent the product or service itself) and/or meaningful discriminating benefits (emotional and positional factors stemming from the brand image). consumer behavior suggests that lower price is a powerful incentive that sooner or later takes precedence over many of the discriminating benefits that brands rely on for differentiation.

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