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BAM 620: Strategic Marketing > Chapter 10 > Flashcards

Chapter 10 Flashcards

1
Q

One Key Purpose of the Marketing Plan

A

To develop and maintain long-term customer relationships

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2
Q

*Definition of Customer Relationship Management (CRM)

A

*A business philosophy aimed at defining and increasing customer value in ways that motivate customers to remain loyal

About retaining the “right” customers

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3
Q

Groups Involved in CRM

A
  1. Customers
  2. Employees
  3. Supply Chain Partners
  4. External Stakeholders
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4
Q

Shifts from Acquiring Customers to Maintaining

A

Customers - Clients
Mass Marketing - One-to-One Marketing
Get New Customers - Keep Current Customers
Discrete Transactions - Continuous Transactions
Increase Market Share - Increase Share of Customer
Based on Groups - Based on Individuals
Homogeneous Group Needs - Heterogeneous Needs
Short-Term Focus - Long Term Focus
Standard Products - Mass Customized Products
Lowest-Cost - Value-Based

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5
Q

Relationship Capital

A

Stems from the value generated by the trust, commitment, cooperation and interdependence among relationship partners.

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6
Q

*Stages of Customer Relationship Development

Intensity

A
  1. Awareness
  2. Initial Purchase
  3. Repeat Customer
  4. Client
  5. Community
    * 6. Advocacy
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7
Q

Increasing the Share of Customer

A

Abandon all old notions of acquiring new customers and increasing transactions to focus on more fully serving the needs of current customers

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8
Q

5 Changes in Business Relationships

A
  1. Roles of the Buyers and Sellers
  2. Increase in Sole Sourcing
  3. Increase in Global Sourcing
  4. Increase in Team-Based Buying Decisions
  5. Increase in Productivity Through Better Integration
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9
Q

*Quality

A

Relative term referring to the degree of superiority of a good or service compared to a competitor or standard.

*Is NOT value

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10
Q

Core Product of Service Offerings

Components

A
  1. People
  2. Process
  3. Physical Evidence
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11
Q

Supplemental Products

A

Goods or services that add value to the core product

Often the difference between two products lies here

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12
Q

Why Businesses Struggle with Product Quality

A
  1. Customers have high expectations
  2. Most products are in mature markets
  3. Little differentiation
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13
Q

How Businesses can Improve Quality

4 Standout Issues

A
  1. Understand Customers’ Expectations
  2. Translate Expectations into Quality Standards
  3. Uphold Quality Standards
    * 4. Do NOT Overpromise
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14
Q

*Perceived Value

A

*Perceived Value = (Core Quality + Supplemental Quality + Experiential Quality) / (Monetary Costs + Non-monetary Costs)

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15
Q

Transactional Cost

A

Immediate financial outlay or commitment that must be made to purchase the product

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16
Q

Life Cycle Cost

A

Additional costs that customers will incur over the life of the product

I.E. Consumable supplies, maintenance, and repairs.

17
Q

The Key to Customer Retention

A

Customer Satisfaction

18
Q

Customer Satisfaction

A

The degree to which a product meets or exceeds the customer’s expectations

19
Q

Range of Customer Expectations

A
  1. Ideal Expectation
  2. Normative Expectation
  3. Experience-Based Expectation
  4. Minimum Tolerable Expectation
20
Q

Zone of Tolerance

A

The difference between desired and adequate performance of a product.

  1. Customer Delight
  2. Customer Satisfaction
  3. Customer Dissatisfaction
21
Q

Managing Customer Expectations

A
  1. Why are expectations unrealistic?

2. Should we delight out customers?

22
Q

How to Develop Customer Loyalty

A
  1. Seek Out Negative Feedback
  2. Manage from the Outside In
  3. Recognize the One Size Does Not Fit All
  4. Put Service Over Personalization
23
Q

Typical percentage of profitable customers

A

20%

24
Q

Keys to Customer Satisfaction and Retention

A
  1. Understand What Can Go Wrong
  2. Focus on Controllable Issues
  3. Manage Customer Expectations
  4. Offer Satisfaction Guarantees
  5. Make It Easy for Customer to Complain
  6. Create Relationship Programs
  7. Make Customer Satisfaction Measurement a Priority
25
Q

Customer Satisfaction Measurement Methods

A
  1. Lifetime Value of a Customer (LTV)
  2. Average Order Value (AOV)
  3. Customer Acquisition/Retention Costs
  4. Customer Conversion Rate
  5. Customer Retention Rate
  6. Customer Attrition Rate
  7. Customer Recovery Rate
  8. Referrals
  9. Social Communication
26
Q

Benefits of Focus Groups

A

Allows firm to measure customer satisfaction

Includes emotional and psychological underpinnings.

27
Q

Customer Relationship Strategies

A
  1. Financial Incentives
  2. Social Bonding
  3. Enhanced Customization
  4. Structural Bonding
28
Q

Value

Definition

A

Subjective evaluation of benefits relative to costs that determines worth of product offering relative to other offerings

BAM 620: Strategic Marketing (9 decks)

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