strategy business marketing reflection paper (just guest speaker parts )

Managing B2B Customers

Lecture 10

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• Purchasing Orientation and Negotiation • Chapter 3

3 • B2B Relationships and Networks • Handout

4 • Market Sensing / Price value • Chapter 2

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• B2B Strategy and Planning • Chapter 4

6 • Managing B2B Products and Services • Chapter 5, 6

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• Integrated B2B Marketing Communications and Consultative Selling • Handout

8 • Business Channel Management • Chapter 7

9 • Gaining and Managing Customers • Chapter 8, 10

10 • Managing B2B Customers • Handout

11 • - The Digital Evolution in B2B • Handout

Understanding Value

Creating Value

Delivering Value

B2B Marketing Framework

1.   Regard Value as Cornerstone. 2.   Focus on Relationship Interaction and

Networks. 3.   Focus on Business Market Processes. 4.   Stress doing Business Across Borders.

Guiding Principles

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Quote

No customers, no business – no business, no job!

The Marriage Metaphor

•  The marriage or marital metaphor arose from three consultative projects completed in 1989-1990, all done with manufacturers selling B2B. Reference: Joseph Sperry 21/1/1993

•  This has been adapted as metaphors to describe five possible states of marriage that could equally apply to business relationships today.

One Night Stand Theory

Ø  Manufacturer and customer enter into a one to one relationship encounter that does not last long

Ø  Low involvement and commitment Ø  Little loyalty Ø  Sometimes can lead to neurotic

relationships Ø  All things must pass “George

Harrison’s first solo album after Beatles break-up.

Courtship Theory

Ø  Early stages of building manufacturer customer relationship

Ø  Getting to know each other Ø  Building trust and commitment Ø  Relationship building is a costly

procedure - not to be entered into lightly

Marriage Theory Ø  Both manufacturer and customer

are ready for commitment. Ø  Good fit between both

manufacturers and customers strengths, weaknesses and expectations.

Ø  Relationship has ü  Trust ü  Communication ü  Commitment ü  Common Goals ü  Incentives

Retention Theory

Ø  Both manufacturer and customer have shared goals

Ø  Adaptive to each others needs. Ø  High levels of trust and

commitment Ø  Positive and frequent

communication exchange between both parties to resolve indifferences and conflicts that may arise.

Separation Theory

Ø  Manufacturer and customer infrequent communication exchange.

Ø  Blame game – “Its your fault not mine”

Ø  Real or imaginary conflicts take hold.

Ø  Lack of trust and commitment to resolve conflicts.

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Lecture Outline

•  Overview •  Relationship Management Processes •  Customer Relationship Management •  Fulfilling Mutually Agreed-Upon Customer Requirements.

•  Pursuing Continuity and Growth. •  Summary

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Overview

Managing customer relationships is the process of 1. fulfilling mutually agreed-upon customer requirements in a superior way over time. 2. pursuing a targeted share of the customers business through building mutual self interest. 3. delivering a memorable customer experience.

Definition Customer Experience

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B2B Customer Experience

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Customer Relationship Management

•  developing a dialogue with customers •  across all their access points, with •  personalised treatment of the most valuable customers

•  to ensure customer retention and the effectiveness of marketing initiatives

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Six Relationship Management Strategies

Overview over Relationship Process

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Managing and Sustaining Customer Relationships

Fulfilling Mutually Agreed-Upon Customer Requirements.

Pursuing Continuity and Growth

Thinking Strategically about Relationships

Delivering Superior Value with Relationship- Specific Market Offerings.

Working together

Pursuing Growth

Evaluate Relationships Outcomes and reassign accounts.

Periodically update the value provided

Delivering value over time to repeat customers

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Step 1: Fulfilling Mutually Agreed- Upon Customer Requirements.

Ø Thinking Strategically about Relationships. ü Consider Industry Bandwidths. ü Partnering as a Focused Market Strategy.

Ø Segmentation, targeting, and positioning (STP). Ø Collaborative emphasis VS transaction emphasis.

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Transactional and Collaborative Working Relationships

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Fulfilling Mutually Agreed-Upon Customer Requirements

Ø Delivering Superior Value with Relationship-Specific Offerings. ü  Construct Relationship-Specific Market Offerings.

Ø Flare out by unbundling Ø Flare out with augmentation Ø Create flexible service offerings

Momentum Matrix For B2B Customers

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Step 2: Pursuing Continuity and Growth

Ø Working together ü Promote Honest and Open Communication. ü Build Trust and Commitment. ü Implement Coordination Mechanisms. ü Anticipate and Resolve Conflicts.

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Pursuing Continuity and Growth

Ø  Pursuing Growth ü Get Customers Comfortable With Single Sourcing. ü Propose Broader Offerings ü Put Risk-Sharing and Gain-Sharing Agreements in Place.

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Pursuing Continuity and Growth

Ø  Evaluating Relationship Outcomes and Reassign Accounts. ü Implementing Activity-Based Costing. ü Monitor Transaction Prices. ü Evaluating Working Relationships.

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Pursuing Continuity and Growth

Ø  Periodically Update the Value Provided. ü Sustaining Customer Relationships Through Connected Relationships.

ü Reforming Relationship Offerings. ü A Final Thought on Sustaining Relationships.

Customer-Centric Approach Framework

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Happy Employees

Happy Customers

Higher Renewal Rates

Improved Profits

How engaged are your

employees?

How satisfied are your

customers with your services?

How many customers are you retaining?

What is the lifetime value

of your customers?

Building a customer-centric culture is pivotal for success

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Net Promoter Score

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Summary Ø  Sustaining customer relationships is the process of

fulfilling mutually agreed-upon customer requirements in a superior way over time and pursuing a targeted market share of customer’s business through building mutual self-interest

Ø  Strategic approach to partnering Ø  Based on fundamental marketing concepts of

segmentation, targeting, and positioning. Ø  Relationships with customers are becoming collaborative.

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Summary Ø  Sustaining collaborative relationships is

challenging. Ø  Firms must work closely together. Ø  To pursue growth business managers are

pursuing single sourcing, facilities management and outsourcing.

Ø  Risk sharing agreements/gain sharing agreements

Ø  Evaluate the results of working relationship.