Marketing

What can be Outsourced

Manufacturing◦Apple, Nike

Advertising◦HUL, P&G

Marketing◦Film producers

IT Infrastructure◦Cloud based services

What cannot be outsourced?

Aspirations ◦Successful Businesses are aspirations realized

Ideas ◦Successful Businesses are about

implementation of innovative ideas. Relationships

◦Relationships creates trust, commitment, positive energy

◦Provide information, investments, reputation

Marketing is Customer Value

Customer Value can be Tangible and Intangible◦Tangible benefits can be imitated by competition◦Tangible benefits and resultant advantages are

difficult to maintain◦Customer Satisfaction of tangibles is a moving

target. Customers expect more when they get more. ◦Expensive to create and maintain .

Consumer Intangibles ◦Symbolic Consumption (Imagery, aspirations)◦Hedonic Consumption (A superior Experience)◦Value we can capture can be more than the cost of

creating itBrand Premium

Where do we want to compete?

On tangibles?◦Certainly yes◦Lower the cost of production, sourcing,

operations, have the least operating margins◦Provide the convenience , assortment, quality

assurance , longer working hours, quick billing◦Have Economies of Scale, have large scale

Be Big

Where do we want to compete?

On Intangibles?◦Certainly yes

Build a Brand ◦Create aspiration in consumers to associate : What I

get is more than the price product will fetch in the market.

◦Create symbolic ValueProvide a unique consumption experience

difficult to duplicate◦Create hedonic value◦Personal relations, warmth, recognition, emotional

bond◦Service differentiation and Customer Experience

Management Customization

Strategic Marketing

What is the unique value you want to provide the consumer?◦Functional /Utilitarian (Tangibles)◦Symbolic Aspirational brand(Intangible)◦Hedonic Experience (Intangible)

A Marketing strategy involves your choice of ◦What type of consumers to serve?◦What value to provide?◦Communicating and Influencing the consumer

Influencing Consumers

Types of mental responses◦Affect : Feel

A state of Mind Feeling responses

◦Cognition : Thought Mental process Thinking responses

◦Behavior : Act Overt or Covert

ABC Model of Influence

Affect

Emotion to Mood◦Joy, Love, Fear, Guilt, Anger, Warmth, Disgust,

Sadness, Calm, Blue, Boredom, Dislike, Melancholy

◦Positive and negative◦Strong or Weak◦Innate or learned

Mental Biases

Cognition

Thought◦Information processing

Thoughts about◦Benefits◦Comparisons◦Advantages◦Apply previous learning

Behaviour

Consumption behavior◦Purchase◦Selection ◦Choice of a store◦Join a scheme◦Recommendation and referral◦Repeat Purchase

ABC

Love Marriages

Cognition > Affect > Behaviour

Cognition > Behaviour > Affect

Affect > Behaviour > Cognition

Affect > Cognition > Behaviour

Behaviour > Affect > Cognition

Customer Service

Please recall the experience as a customer you were most dissatisfied? ◦Please Describe on a sheet

Customer Experience Management

Service Quality◦How do customers perceive and evaluate service

quality?◦What are managers’ perceptions about service

quality?◦Do discrepancies exist between the perceptions of

customers and those of managers?◦How can Retailers improve customer service and

achieve excellence?

Service Quality and Satisfaction

A Customers can be Satisfied and Dissatisfied at the same time◦Different factors cause satisfaction and

dissatisfaction◦Identify factors (hygiene factors) that cause

dissatisfaction and remove them◦Identify factors (Satisfiers) that cause

Satisfaction and Implement.

Determinants of Perceived Service Quality

ExpectedService

PerceivedService

ServiceQuality

GapPerceived

ServiceQuality

Word ofMouth

PersonalNeeds

PastExperience

External Communication

to Customers

A “GAPS” MODEL OF SERVICE QUALITY

Customers’ Service

Expectations

CUSTOMER RETAILER

Service Quality

Gap

Customers’ Service

Perceptions

GAP 5

Organization’s Understanding of Expectations

Organization’s Service

Standards

Organization’s Service

Performance

Organization’s Communications

to Customers

Market Information

Gap

Service Performance

Gap

Internal Communicatio

n Gap

Service Standards

Gap

GAP 1 GAP

2

GAP 3GAP

4

The Five Dimensions of Service Quality

Ability to perform the promised service dependably and accurately.

Knowledge and courtesy of employees and their ability to convey trust and confidence.Physical facilities, equipment, and appearance of personnel.

Caring, individualized attention the firm provides its customers.

Willingness to help customers and provide prompt service.

Tangibles

Reliability

Responsiveness

Assurance

Empathy

Five Expectation Categories

Reliability - deliver what is promised

Responsiveness - do it promptly

Assurance - know how to do it

Empathy - do it with respect and understanding

Tangibles - ensure that buildings, surroundings, and materials are attractive

Service Quality

Providing service as promised Dependability in handling customers’

service problems Performing services right the first time Providing services at the promised time Maintaining error-free records

Keeping customers informed as to when services will be performed

Prompt service to customers Willingness to help customers Readiness to respond to customers’

requests

RELIABILITY

RESPONSIVENESS

Employees who instill confidence in customers

Making customers feel safe in their transactions

Employees who are consistently courteous Employees who have the knowledge to

answer customer questions

ASSURANCE

Giving customers individual attention Employees who deal with customers in a

caring fashion Having the customer’s best interest at heart Employees who understand the needs of

their customers Convenient business hours

EMPATHY

Modern equipment Visually appealing facilities Employees who have a

neat, professional appearance

Visually appealing materials associated with the service

TANGIBLES

Relative Importance of Service Dimensions When Respondents Allocate 100 Points

TANGIBLES 11%

EMPATHY 16%

RELIABILITY 32%

ASSURANCE 19%

RESPONSIVENESS

22%

Assessing Service Characteristics

Reliability: accuracy of billing, meeting promised delivery dates

Assurance (trust): guarantees and warranties, return policies, Faith

Tangibility: appearance of store and salespeople

Empathy: personalized service,, recognition by name, understanding the requirements

Responsiveness: returning calls and emails, giving prompt service