2. It is better to focus resources on getting new business from
existing customers, than in finding new customers
3. 1. Customer 4. Recruitment
Markets Markets
2. Referral Relationship 5. Influence
Markets Marketing Markets
3. Supplier 6. Internal
Markets Markets
It is the job of marketing to help all divisions to adopt a marketing
orientation toward both its internal and external customers.
4.
5. 1. Analyse customer 2. Calculate annual
base & divide into revenues earned
segments from customer
segments
3. Calculate annual 4. Identify & retain
costs of serving quality customers
the segments
5. Eliminate or re-
engineer the
unprofitable
customer groups
6. The value of the The probability
customer account, that the original
derived from each purchaser will later
of the purchases it buy each of the
may undertake in additional products
the future
The initial
The value of costs of
the customer The probability of attracting the
account, retaining the customer
derived from its customer after the
original original purchase,
purchases and into the future
8. E-business
Integrated
e-commerce
E-commerce
Web presence
9. Delivery to
Business Consumer
Business B2B B2C
Exchange
Initiated by
C2B C2C
Consumer
Editor's Notes
Customer markets:These are the buyers of the final product and they remain the final goal of marketing activity. To be able to deliver superior customer value in increasingly competitive industries, modern relationship marketing emphasises the importance of having appropriate relations with other interfaces.Referral markets: Referral markets are the institutions and individuals who refer the customer to us. This could include banks, agents as well as existing customers. Therefore cultivating relationships with these intermediaries is critical to getting new customers.Supplier markets: Partnerships with suppliers must replace traditional adversarial relations if the firm is to better meet the needs of the final customer. This can include collaboration to improve quality, set up JIT arrangements or to work together in harnessing product innovations. Marketing must sell new attitudes essential to these partnerships.Recruitment markets:To provide good service to customers, it is essential that the firm has good staff. However in a competitive market the good-calibre staff member also has a choice. Marketing should build up appropriate relationships with the stakeholders in the recruitment markets (agencies, careers advisers, head-hunters, etc.), as well as ensuring that the corporate image of the firm is appealing to would-be recruits (e.g. through the design of corporate literature and selective sponsorship).Influence markets:Influence markets are institutions that can influence what customers will purchase. For example an aeroplane manufacturer will need to influence national governments as well as airlines of the safety of its products. Other examples include pressure groups, brokers, analysts, consumer associations, etc. This influence of marketing often occurs under the heading of public relations or lobbying activities.6. Internal markets: Internal markets have two aspects to them:Each internal department is the customer of some and a supplier to the rest. For the firm to operate smoothly it is important that a client service ethos pervades all departments and replaces divisional rivalries and loyalties.Each division should interpret what it does in terms of how it serves the customer. You may recognise this view as the third pillar of Kotler's version of the marketing concept.
Customer account profitability (CAP) analysis takes the single-period view of the value of the customer.A UK clearing bank recently revealed that 20 per cent of its customers generated 120 per cent of its profits. Put another way, 80 per cent of its customers are unprofitable and reducing its profits by 20 per cent! Using CAP analysis would reveal which customers this 80 per cent are (and who the 20 per cent are too). SEE ATTACHED NOTE ON CAP
