This document discusses marketing concepts related to creating customer value, satisfaction, and loyalty. It covers customer perceived value, steps in customer value analysis, customer-product profitability analysis, quality, customer relationship management strategies, and database marketing. Specifically, it provides examples of how SMBI, a beer manufacturer, applies these concepts such as focusing on quality, different packaging for various customer needs, research and development investments, and maintaining customer information databases.

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CHAPTER 5
MARKETING CONCEPTS:
Creating Customer Value,
Satisfaction and Loyalty
as applied to
By Nicole Laya A. Alunan

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1. Customer Perceived Value
CPV = total customer benefit – total customer cost

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1. Customer Perceived Value
CPV = total customer benefit – total customer cost
where:

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1. Customer Perceived Value
TOTAL CUSTOMER VALUE TOTAL CUSTOMER COST
Product Value
- High quality beers
Monetary Cost
- More malt content = fuller
body and mouthfeel = more
expensive
Image Value
- SMB = best beer brand
Energy Cost
- More processing = more
expensive
Service Value
- Fast delivery to outlets
Time Cost
- Longer fermentation = more
costly

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2. Steps in Customer Value Analysis
Set performance
levels
Rate performance
levels
Assess against
competitors
Assess
performance levels
Monitor performance
levels

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2. Steps in Customer Value Analysis
Performance Level Weight
SMBI ABI
Rating Score Rating Score
Price 0.1 3 0.3 4 0.4
Branding 0.1 4 0.4 3 0.3
New product development 0.2 2 0.2 3 0.3
Advertisement 0.1 3 0.3 3 0.3
Taste and flavor 0.1 4 0.4 2 0.2
Product Distribution 0.2 4 0.8 2 0.4
Product & Process Quality 0.2 4 0.8 2 0.4
Process Efficiency 0.1 3 0.3 3 0.3
1.0 3.5 2.6

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3. Customer-Product Profitability Analysis
What costs? = Which customers?

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3. Customer-Product Profitability
Analysis
Product with higher cost
for high-end market
Product with lower cost
for bigger volume

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4. Quality
The totality of features and characteristics of a
product or service that bear on its ability to
satisfy stated or implied needs.

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4. Quality
Corrective and preventive
quality functions lead to
higher profitability!

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5. Customer Relationship Management
Strategies
= How to Manage Customer Base
1. Reduce rate of defection
2. Increase longevity
3. Enhance “share of wallet”
4. Focus on high-profit customers

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5. Customer Relationship
Management Strategies
SMBI continues to be the number 1
manufacturer and distributor of local beers by:
• Putting quality first
• Has different packaging to cater to various
needs
• Invests on R&D

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6. Database Marketing
to contact,
to transact,
to create relationships
Build/maintain/use info

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6. Database Marketing

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CHAPTER 5
MARKETING CONCEPTS:
Creating Customer Value,
Satisfaction and Loyalty
as applied to
By Nicole Laya A. Alunan