Number of sources: 5
Customers are said to be value maximizers and will seek to buy from the firm they perceive as delivering the greatest value. Conversely, companies need to understand which customers are profitable and to extract the maximum lifetime value by effectively managing customer relationships. Market-oriented firms that are able to do this effectively may well find themselves in a position that will permit them to achieve superior firm performance.
(i) Define success for the market-oriented firm in the context of the customer. What defining characteristics does the successful market-oriented firm have? How are these attributes used to create marketing success? Please use examples to illustrate the points you make.
(ii) Is there such a thing as an unprofitable customer? How do market-oriented firms make decisions about which markets to pursue and which not to pursue? What should firms do to ensure that their core customers are profitable ones?
(iii) Attracting and retaining customers is at the core of profitability for many firms. What must firms do to be effective at this key task? Again, please illustrate with examples.
For many firms, segmenting, targeting, and positioning are essential aspects of firm marketing strategy. Effective implementation of the marketerâ€™s understanding of the market may be perceived as a key to firm success.
(i) Explain the rationale behind this process and relate it to the bigger (strategic) marketing picture. What does it mean in terms of the firmâ€™s value chain and strategic orientation? What does it mean in terms of the firmâ€™s resources?
(ii) What is necessary for this strategic process to be effective from the perspective of both the firm and the consumer? How does it support the goals of the market-oriented firm?
(iii) How does effective positioning create customer value? Explain using examples.