Value Creation For Customers

customersDear readers,

marketing is no longer the responsibility of a single department. It’s the company as a whole which should drive its vision, mission and strategic planning. All departments should work together to achieve customer goals. That means one key factor of success: cooperation. Internal marketing requires vertical alignment with senior management and horizontal alignment with other departments.

In my previous post “CSR & Web Communication Insights” I talked about the importance of CSR. The effects of marketing extend beyond the company and the customer to society as a whole. Marketing & Communication professionals should consider the ethical, environmental, legal and social context of their role and activities. One of the most important factors that organizations of all kinds should keep in mind is that their job is to determine customers’ needs, wants and interests and satisfy them more effectively and efficiently than competitors. How do companies create, communicate and deliver value to customers at a profit? Organizations should understand consumer markets. What features and prices is my target market looking for and where they want to shop? Organizations should also create successful long-term growth, and that means taking into account changing global opportunities and challenges.

Marketing has always been defined in terms of satisfying customers’ needs and wants. During the sessions of Sociology of Consumption at the University of Milan I had the possibility to learn that the world of advertising usually stimulates people’s desires. People may have a need and may want something, but the reality is that producers define what are the particular features of the new smartphone or of the new television and they present those items to customers through advertising campaigns and promotion in general. Firms must stick to a strategy but also improve it. They must also develop strategies for a range of products and services within the organization. As I said earlier, the task of any business is to deliver customer value at a profit.

We live in a hypercompetitive economy with increasingly informed buyers. Firms must be relevant in the marketplace in order to win against their competitors. Winning can be implemented only by choosing, providing and communicating superior value. The smart firm must design and deliver offerings for well-defined target markets. Today we talk about developing the offering’s value proposition. Successful marketers should segment the market, select the appropriate target and then realize what is the true value proposition for consumers. Communicating value is the final step of the marketing activity. Communication can be enhanced through the utilization of the internet, advertising and any other communication tool. Organizations want to get long-lasting relationships with their customers.

Defining the corporate mission is the overall starting point. An organization exists to accomplish something: to make smartphones, to lend money, to provide new products and services. Amazon.com for example changed its mission over the years from being the world’s largest online bookstore to aspiring to become the world’s largest online store. What is our business? Who is our customer? What is of value to the customer?  These questions are fundamental for large or small organizations. Successful companies continuously answer them. Successful organization develop and share mission statements with managers, employees and customers, within and outside the organization. When we talk about value creation for customers, one of the most important thing that organizations should keep in mind is having a limited number of goals. They take a long-term view.

What is our mission? What about our philosophy? What kind of products and services we want to create and deliver to customers? At the same time each business unit needs to define its specific mission within the broader company mission. One of the most important tools companies use during the mission statements creation is the SWOT Analysis. It allows people to evaluate which are the strengths, weaknesses, opportunities and threats. A business unit must monitor key macroenvironment forces and significant microenvironment factors. Once the company has performed the SWOT Analysis, it can proceed to goal formulation. Goals indicate what a business unit wants to achieve. Strategy is a specific plan for getting there.

Collecting information about our customers is the right thing to do in order to forecast demand. Companies must possess comprehensive, up-to-date information about macro trends. Continuous monitoring, forecasting about the environment is highly important. Databases and Data Mining are the keys to successful planning and forecasting demand. Organizations should combine their data and organize the overall information into customer, product and salesperson databases. At the same time, just like core beliefs and values are passed from parents to children and reinforced by social institutions, managers should do the same with their co-workers and subordinates.

Communicating value with their present and potential stakeholders and the general public is the starting point for companies which shouldn’t just develop a good product, price it and make it accessible. For most marketers, the key question is not whether to communicate but rather what to say, how and when to say it, to whom and how often. Marketing communications are the means by which firms attempt to inform, persuade and remind consumers about the products and brands they sell. Marketing communications represent the voice of the company and its brands. They are means by which the company can establish a dialogue and build relationships with consumers. Today marketing professionals often talk about creating customer equity, which is the total combined customer lifetime values of all of the company’s customers.

Value creation can be enhanced using the marketing communication mix which consists of advertising, sales promotion, events, PR, direct marketing and personal selling. Delivering value means communicating the right messages to the right target audience. When marketing and communication professionals identify the target audience, the starting point is achieved. The overall process of value creation and communication should start through clearly defining who are my potential customers. Then, we simply identify the communication objectives and implement the right message strategy.

Which channels am I going to use in order to implement my Value Communication Strategy? The most important thing is selecting an efficient means in order to deliver our message to the target audience. An holistic way of communicating value to potential customers seems to be the best way to achieve strategic goals. Marketers should integrate communication channels. Advertising reaches geographically dispersed buyers. It can build up a long-term image for a product. Budgeting is also very important. Whether we are talking about large or small companies determines the budget level and financial efforts for the company we’re taking into consideration. Advertising campaigns which are implemented through television are financially expensive. The Communication Mix can vary a lot from company to company and from product to product as well as from service to service.

So, building customer value, satisfaction and loyalty is at the heart of every business. Successful marketing companies place their customers at the heart of their vision and mission. Customers are better informed and educated than ever. Consumers have varying degrees of loyalty to specific brands, stores and companies. The value proposition consists of the whole cluster of benefits the company promises to deliver. It is more than the core positioning of the offering. The value proposition is a promise about the experience customers can expect from a company’s market offering.

In general, satisfaction is a person’s feelings of pleasure or disappointment that result from comparing a product’s perceived performance to expectations. If the customer gets a bad performance of the product, the customer is dissatisfied. If it exceeds expectations, the customer is highly satisfied or delighted. If marketers raise expectations too high, the buyer is likely to be disappointed.

Many companies are measuring how well they treat customers. All successful firms measure customer satisfaction regularly, identifying the factors shaping satisfaction and changing operations and marketing as a result. A highly satisfied customer generally stays loyal longer, buys more as the company introduces new and upgraded products, talks in a positive way about the products and the company. It’s true that marketing is going to a new direction… we’re talking more and more about values and that’s a new positive asset. But customer centricity remains a must-have for organizations. Customer is king!

FL

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