Transcript Competitive Strategies

18-1
PRINCIPLES OF MARKETING
Chapter 18
Competitive Strategies:
Building Lasting Customer
Relationships
Defining Customer Value
=
Total Customer
Value
(Product, Service,
Personnel, &
Image Values)
Total Customer
Cost
(Monetary, Time,
Energy, &
Psychic Costs)
Customer
Delivered Value
(Profit to the
Consumer)
18-2
Customer Satisfaction
18-3
Product’s Actual Performance
Customer Satisfaction Results When a Company’s
Performance Has Fulfilled a Buyer’s Expectations.
Performance Exceeds ExpectationsCustomer is Delighted
Buyer’s Expectations Are Based On:
Customer’s Past Buying Experiences
Opinions of Friends & Associates
Marketer/ Competitor Information &
Promises
Performance Below Expectations Customer is Dissatisfied
Total Customer Satisfaction
18-4
• Highly satisfied (delighted) customers produce
benefits:
– They are less price sensitive,
– They remain customers longer,
– They talk favorably about the company and products to
others.
• Delighted customers have emotional and rational
preferences for products, and this creates high
customer loyalty.
• Therefore, the purpose of Marketing is to generate
customer value profitably.
The Need for Customer Retention
18-5
The Key to Customer Retention is Superior Customer
Value and Satisfaction. Companies Must Consider:
New
Customer
Costs
Customer
Lifetime
Value
Lost
Customer
Costs
Building Customer Satisfaction and
Loyalty by Relationship Marketing
Relationship Marketing Involves Creating, Maintaining, and
Enhancing Strong, Long-Term Relationships with
Customers and Other Stakeholders.
Methods for Building Relationships Include Offering:
Financial
Benefits
Social
Benefits
Structural
Ties
18-6
18-7
Value Chain
Support Activities
Firm Infrastructure
Human Resource Management
Technology Development
Procurement
Inbound
Logistics
Operations
Outbound
Logistics
Primary Activities
Marketing
and
Sales
Service
Order
Raw Material
Supplier
Delivery
Order
Vendor
Delivery
Order
Producer
Delivery
Order
Retailer
Delivery
Order
Customer
Delivery
Customer Value-Delivery Network
18-8
18-9
Total Quality Marketing
Necessary But May
Not Be Sufficient
Does Not
Cost More
Quantum
Leaps
Quality is in the
Eyes of the Customer
Pursuing
a Total
Quality
Marketing
Strategy
Every Company
Activity
Total Employee
Commitment
High Quality
Partners
Continuous
Improvement
Cannot Save
Poor Product
Competitor Analysis
Identifying Competitors
Assessing Competitors
Determining Objectives
Identifying Strategies
Assessing Strengths and
Weaknesses
Estimating Reaction
Patterns
Selecting Competitors to
Attack and to Avoid
18-10
Developing Competitive Marketing
Strategies
Basic Competitive Strategies
Overall Cost
Leadership
Focus
Differentiation
Middle of
the Road
18-11
Developing Additional Competitive
Marketing Strategies
Value Disciplines
Operational
Excellence
Product
Leadership
Customer
Intimacy
18-12
18-13
Competitive Positions
Competitive Positions
Competitive Strategies
Market Leader
Expand Total Market
Protect Market Share
Expand Market Share
Firm with the Largest
Market Share
Market Challenger
Runner-Up Firms that
Fight Hard to Increase
Market Share
Full Frontal Attack
Indirect Attack
Market Followers
Runner-Up Firms that Want
to Hold Their Share Without
Rocking the Boat
Follow Closely
Follow at a Distance
Market Nichers
Firms that Serve Small
Segments Not Being
Pursued by Other Firms
By Customer, Market,
Quality-Price, Service
Multiple Niching
Balancing Customer and
Competitor Orientations
18-14
Competition-Centered
Customer-Centered
No
Yes
No
Yes
Product
Orientation
Customer
Orientation
Competitor
Orientation
Market
Orientation