Download Creating_Value_in_Marketing___CRM_by_Personal_Selling

Adapting Marketing to the New Economy
Major Drivers of the New Economy
– Digitalization and Connectivity
– Disintermediation and
Reintermediation
– Customization and
Customerization
– Industry Convergence
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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Table 2-1: Old Economy vs. New Economy
Old Economy
New Economy
Organize by product units
Focus on profitable transactions
Look primarily at financial scorecard
Focus on shareholders
Marketing does the marketing
Build brands through advertising
Focus on customer acquisition
Organize by customer segments
Focus on customer lifetime value
Look also at marketing scorecard
Focus on stakeholders
Everyone does the marketing
Build brands through behavior
Focus on customer retention and
growth
Measure customer satisfaction and
retention rate
Underpromise, overdeliver
No customer satisfaction
measurement
Overpromise, underdeliver
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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Figure 2-1:
The SupplierCustomer
Relationship:
Traditional and
New Economy
Structures
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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Adapting Marketing to the New Economy
How Marketing Practices are Changing:
Customer Relationship Marketing
– Reduce rate of customer defection
– Increase longevity of customer
relationship
– Enhance growth potential through
cross-selling and up-selling
– Make low profit customers more
profitable or terminate them
– Focus disproportionate effort on high
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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value customers
Mass Marketing vs. One-to-One Marketing
Mass Marketing
One-to-One Marketing
Average customer
Customer anonymity
Standard product
Mass production
Mass distribution
Mass advertising
Mass promotion
One-way message
Economies of scale
Share of market
All customers
Customer attraction
Individual customer
Customer profile
Customized market offering
Customized production
Individualized distribution
Individualized message
Individualized incentives
Two-way messages
Economies of scope
Share of customer
Profitable customers
Customer retention
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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Adapting Marketing to the New Economy
Four steps for One-to-One Marketing
Don’t go after everyone, identify prospects.
Define customers by their needs and their value
to the company.
Individual interaction with customers builds
stronger relationships.
Customize messages, services, and products for
each customer.
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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PERSONAL SELLING IN INFORMATION AGE
Evolution from industrial to information
economy
INDUSTRIAL--1950s
INFORMATION--PRESENT
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SHIFT TO INFORMATION ECONOMY
INDUSTRIAL
Advances in transport
and manufacturing
Strategic resources
are capital and
natural resources
Products and
factories define the
business
Sales success means
meeting quotas
INFORMATION
Advances in
information
technology
Strategic resource is
information
Business defined by
customer relations
Sales success
depends on adding
value
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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EVOLUTION OF PERSONAL SELLING
MARKETING ERA
1950s
CONSULTATIVE SELLING ERA
1960s-1970s
STRATEGIC SELLING ERA
1980s
PARTNERING ERA
1990s-Present
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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MARKETING AND CONSULTATIVE ERAS
MARKETING
– Sales team as source of strategic
information on…product--market-service
CONSULTATIVE
– Emphasis on need identification
– Transactional selling
– Information sharing & negotiation
replace manipulation
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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STRATEGIC AND PARTNERING ERAS
STRATEGIC
– Emphasis on strategic market plan
– Tactics to achieve strategic plan
– Product positioning vital
PARTNERING
– Customer, not product, as driving
force
– Emphasis on strategies that create
customer value
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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PERSONAL SELLING:
DEFINITION
PERSON-TO-PERSON COMMUNICATION
WITH PROSPECT
–
–
–
–
–
DEVELOPING RELATIONSHIPS
DISCOVERING NEEDS
MATCHING PRODUCTS WITH NEEDS
COMMUNICATION OF BENEFITS
A PROCESS THAT ADDS VALUE
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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SELLING
MODEL
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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INTERRELATIONSHIP OF BASIC
STRATEGIES
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EFFECTIVE RELATIONSHIP STRATEGY
FOUR KEY GROUPS
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E-COMMERCE AND COMPLEX SALE
Complex sales involve several forms
of information technology
support
Tools include:
–
–
–
–
electronic product catalogs
contact management systems
Internet applications
presentation packages like this one
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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VALUE CREATION
Value = creative improvements
enhancing customer experience
Consumer economy rewards
sales
people who add value at each
step
When customer not aware of
value added by salespeople –
focus may shift to price
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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RELATIONSHIPS ADD VALUE
Customers perceive value added
when they feel comfortable with
salesperson
Certain salesperson traits help
create perception of value
– Accountability
– Honesty
– Sincere concern for customer welfare
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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WIN-WIN PHILOSOPHY
CUSTOMER SATISFACTION PRIMARY
FIRST STEP IN DEVELOPMENT OF
RELATIONSHIP STRATEGY
BOTH PARTIES EXIT SALE FEELING
SATISFIED
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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WIN-WIN vs. WIN-LOSE
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--
WIN-WIN TYPES
Help others solve their
problems
Fix what caused the
problem
Make life joyous for all
concerned
Learn from past, live
in present, set future
goals
Honor commitments
WIN-LOSE TYPES
-- See a problem in every
solution
-- Fix the blame
-- Let life happen, are not
proactive
-- Live in the past
-- Make promises they
never keep
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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CHARACTER AND INTEGRITY
Character includes high
personal standards, integrity,
honesty, and moral fiber
Integrity involves achieving
congruence between what you
know, say, and do
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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CUSTOMER RELATIONSHIP MANAGEMENT
CRM - SOFTWARE
CRM enhances relationship
quality
Promotes rapid and effective
client communication
Written records help avoid
miscommunication
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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EVOLUTION OF PARTNERING
Buzzword of 1990s, business reality in
2000s
“Strategically developed long-term
relationship that solves customer’s
problems”
Relationship selling relies on
customized approach to each client
Enhanced with high ethical standards
and sales automation
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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PARTNERING—HIGHEST FORM
Strategically developed high quality,
long-term relationship focusing on
solving customer problems
Must be viewed as process, not an
event
Vijay Bhandari - Senior Faculty-Consultancy - NMIMS [email protected]
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