customer value analysis

Examples of customer value analysis in the following topics:

• Adding Value

  • It is the science of choosing target markets through market analysis and market segmentation, as well as understanding consumer buying behavior and providing superior customer value.
  • To reveal the company's strengths and weaknesses compared to other competitors, it is important to conduct a customer value analysis.
  • Conducting an effective customer value analysis can lead a company to creating an accurate value proposition.
  • A value proposition is a promise of value to be delivered and a belief from the customer that value will be experienced.
  • Developing a value proposition is based on a review and analysis of the benefits, costs and value that an organization can deliver to its customers, prospective customers, and other constituent groups within and outside the organization.

• The Development of Value-Driven Firms

  • The values of an organization are just as important as the products they sell; having a strong value driven culture is important.
  • This was the precursor to customer value management, which has been practiced for the last 35 years, being incorporated into corporate thinking.
  • Some people focus on customer service, others on customer experience, others on lifetime value for a customer; many companies believe that having a customer service department is all it takes to create customer value.
  • A new practice called Total Customer Value Management (CVM) involves a total focus upon the customer.
  • Voice of Employee will be captured through the Customer Circles and Employee Value Add, and the Voice of Customer and Voice of Competitor will be captured by Customer Value Added (CVA).

• Defining Marketing

  • Marketing is the creation, communication, and delivery of value as well as the management of customer relationships for a lifetime.
  • Marketing can be looked at as an organizational function and as a set of processes for creating, delivering and communicating value to customers, and managing customer relationships in ways that benefit the organization and its shareholders.
  • Marketing is the science of choosing target markets through market analysis and market segmentation, as well as understanding consumer buying behavior and providing superior customer value.
  • The set of engagements necessary for successful marketing management include capturing marketing insights, connecting with customers, building strong brands, shaping the market offerings, delivering and communicating value, creating long-term growth, and developing marketing strategies and plans.
  • The official American Marketing Association definition published in July 2013 defines Marketing as "the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. "

• Marketing Orientation

  • Competitive analysis is also a significant component of market orientation.
  • Since its introduction, marketing orientation has been reformulated and repackaged under numerous names including customer orientation, marketing philosophy, and customer intimacy.
  • As stated, the most important focus in a market-orientated business is the customer.
  • Nevertheless, organizations that follow a marketing orientation model realize that delivering superior customer value through product innovation, as well as products and services tailored to customer needs, directly correlates with generating revenue.
  • A company adopting a marketing orientation must focus on the desires of its customers.

• Other Inputs to Pricing Decisions

  • Factors to consider in pricing include Economic Value added to Customers (EVC), competitor's pricing, and government regulations.
  • When customers spend money on a product or service, their main objective is to add value to their lives in some way.
  • Marketers can also study this effect on their products using Economic Value for the Customer (EVC).
  • EVC is based on the insight that a customer will buy a product only if its value to them outweighs the value of the closest alternative.
  • The utility of a product depends on its value to the customer minus its price.

• Business Analysis

  • A complete cost appraisal is also necessary as part of the business analysis.
  • Based on these costs, the business analysis stage will estimate the likely selling price.
  • This figure will also depend on the level of competition, as well as customer feedback.
  • Customers base buying decisions on a personal value equation where the value is calculated by weighing the cost versus the benefits.
  • Financial ratio analysis allows an observer to put the data provided by a company in context.

• Identifying Potential Business Customers

  • Identifying your customer begins with formulating a value proposition.
  • You have to be able to answer this question: "To whom is this proposition of value?
  • This would occur during the periods of market analysis and customer research in the product development cycle .
  • Thus, if a company identifies a potential customer but is uncertain what industry that customer belongs to, using the industrial classification from the NAICS can provide more detailed information on the specific business activities of that potential customer.
  • In the product development cycle, the market analysis and consumer research phases are used to identify customers.

• Scanning and Analysis

  • A trend break could be a value shift in society, a technological innovation that might be permanent, or a paradigm change.
  • Marketing managers are confronted with many environmental concerns, such as those posed by technology, customers and competitors, ethics and law, the economy, politics, demographics, and social trends.
  • A trend break could be a value shift in society, a technological innovation that might be permanent, or a paradigm change.
  • One approach is the PEST analysis.
  • Two more factors, the environmental and legal factor, are defined within the PESTEL analysis (or PESTLE analysis).

• Conducting a Situational Analysis

  • Managers can use various methods of analysis to understand the firm's own capabilities, customers, and business environment.
  • A marketing plan guides businesses on how to communicate the benefits of their products to potential customers.
  • The situation analysis, the 2nd step in a marketing plan, is critical in establishing a long-term relationship with customers.
  • Customer analysis can be vast and complicated.
  • The bargaining power of customers is also described as the market of outputs: the ability of customers to put the company under pressure, which also affects the customer's sensitivity to price changes (e.g. firm can implement loyalty program to reduce customers' buying power).

• Reminding and Retaining Customers

  • Authors such as Don Peppers and Martha Rogers discuss the transition from managing products to managing customers, and differentiating customers rather than just products.
  • To retain their customer base and satisfy customer requirements above those of competitors, brands must engage in the following process:
  • Implementing these relationship marketing practices helps companies counterbalance new customers and opportunities with current and existing customers to maximize profit.
  • It also counteracts the theory that new customers must be gained at the expense of losing older customers.
  • Nurturing customer relationships can lead to customer referrals and new business.