Chapters 18, 19, 20, 21
o Describe Break Even pricing
o Describe Elasticity of Demand. How does Price influence this?
o Describe the impact of the Unfair Trade Practices, Price Fixing, Price
Discrimination and Predatory Pricing.
o Discuss some of the "Other Pricing Tactics" and how they are used.
o Discuss the 7 steps in the Selling Process
o Discuss the objectives of a Pricing Strategy
o Discuss the various promotional tools, their use and objectives
o How can you Capture, Store and Analyze Customer data to identify the
Best Customers?
o How can you fine tune price?
o How do the objectives for Promotions differ from those of
Advertising?
o How does Personal Selling differ from the other promotional mix
tools?
o How does the stage of the Product Life Cycle influence pricing?
o What are some Trade Promotions?
o What are the 3 pricing strategies outlined in the notes/book?
o What is CRM?
o What is meant by Customer Focused?
o What is Relationship Selling?
o What's the difference between a Variable and a Fixed cost?
o Why focus on Loyal Customers?
1
Sales Promotion and Personal Selling
CHAPTER
18
Marketing
Designed by
Eric Brengle
B-books, Ltd.
10
Lamb, Hair, McDaniel
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Prepared by
Amit Shah
Frostburg State University
1
LOI
Sales Promotion
Sales
Promotion
Marketing communication
activities, other than
advertising, personal
selling, and public relations,
in which a short-term
incentive motivates a
purchase.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
2
LOI
Sales Promotion
Advertising
Reason to buy
Sales Promotion
Incentive to buy
Copyright ©2009 by Cengage Learning Inc. All rights reserved
3
Objectives of Sales Promotion
LOI
Type of Buyer
Desired Results
Sales Promotion
Examples
Loyal
Customers
•Reinforce behavior
•Loyalty marketing
•Increase consumption
•Bonus packs
•Change purchase timing
Competitor’s
Customers
•Break loyalty
•Persuade to switch
•Sampling
•Sweepstakes,
contests, premiums
Brand
Switchers
•Persuade to buy your
brand more often
•Price-lowering
promotion
•Trade deals
Price Buyers
•Appeal with low
prices
•Supply added value
•Coupons, price-off
packages, refunds
•Trade deals
Copyright ©2009 by Cengage Learning Inc. All rights reserved
4
Tools for Consumer Sales
Promotion
LO2
Coupon
A certificate that entitles
consumers to an immediate
price reduction.
Rebate
A cash refund given for the
purchase of a product during
a specific period.
Premium
An extra item offered to the consumer,
usually in exchange
for some proof of purchase.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
5
LO2Tools
for Consumer Sales Promotion
Loyalty
Marketing
Program
A promotional program designed
to build long-term, mutually
beneficial relationships between
a company and key customers.
Frequent
Buyer
Program
A loyalty program in which
loyal consumers are rewarded for
making multiple purchases.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
6
LO2Tools
for Consumer Sales Promotion
Contests
Sweepstakes
Promotions that require skill
or ability to compete for prizes.
Promotions that depend on
chance or luck, with
free participation.
http://www.online-sweepstakes.com/
Online
Copyright ©2009 by Cengage Learning Inc. All rights reserved
7
LO2
Tools for Consumer Sales
Promotion
Sampling
A promotional program that allows
the consumer the opportunity to try
a product or service for free.
8
Copyright ©2009 by Cengage Learning Inc. All rights reserved
LO2
Point-of-Purchase Promotion
• Build traffic
• Advertise the product
• Induce impulse buying
Copyright ©2009 by Cengage Learning Inc. All rights reserved
9
LO2
Online Sales Promotion
Effective Types of Online Sales Promotion
• Free merchandise
• Sweepstakes
• Free shipping with purchases
• Coupons
Copyright ©2009 by Cengage Learning Inc. All rights reserved
10
LO3 Benefits of Trade Promotions
▪
Help manufacturers gain new distribution
▪
Obtain wholesaler and retailer support for
consumer sales promotions
▪
Build or reduce dealer inventories
▪
Improve trade relations
Copyright ©2009 by Cengage Learning Inc. All rights reserved
11
LO3
Trade Allowance
Trade
Allowance
A price reduction offered
by manufacturers to
intermediaries, such as
wholesalers and retailers.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
12
LO3
Push Money
Push Money
Money offered to channel
intermediaries to
encourage them to “push”
products--that is, to
encourage other members
of the channel to sell the
products.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
13
LO4
Personal Selling
Personal Selling
is more important if...
Advertising & Sales Promotion
are more important if...
Product has a high value.
Product has a low value.
Product is custom made.
Product is standardized.
There are few customers.
There are many customers.
Product is
technically complex.
Product is
simple to understand.
Customers are
concentrated.
Customers are
geographically dispersed.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
14
LO5
Relationship Selling
Relationship
(Consultative)
Selling
A sales practice that
involves building,
maintaining, and enhancing
interactions with customers
in order to develop longterm satisfaction through
mutually beneficial
partnerships.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
15
LO5
Traditional Selling and Relationship
Selling
Traditional
Personal Selling
Relationship Selling
Sell products
Sell advice, assistance, counsel
Focus on closing sales
Focus on customer’s bottom line
Limited sales planning
Sales planning is top priority
Discuss product
Assess “product-specific”
needs
“Lone wolf” approach
Build problem-solving environment
Conduct discovery in scope of
operations
Team approach
Profit impact and strategic
benefit focus
Long-term sales follow-up
Pricing/product focus
Short-term sales follow-up
Copyright ©2009 by Cengage Learning Inc. All rights reserved
16
LO6
Steps in the Selling Process
Generate Leads
Qualify Leads
Probe Customer Needs
Develop Solutions
Handle Objections
Close the Sale
Follow Up
Copyright ©2009 by Cengage Learning Inc. All rights reserved
17
LO6
Generating Leads
Advertising
Publicity
Direct Mail/
Telemarketing
Cold Calling
Internet Web
Site
Referrals
Networking
Trade Shows/
Conventions
Company
Records
http://www.linkedin.com
http://www.ryze.com
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Online
18
LO6
Qualifying Leads
Recognized need
Buying power
Receptivity and
accessibility
Copyright ©2009 by Cengage Learning Inc. All rights reserved
19
LO6
The Preapproach Process
Product or service
Salesperson
must know
everything
about...
Customers
Competition
Industry
http://www.hoovers.com
http://www.dnb.com
Online
Copyright ©2009 by Cengage Learning Inc. All rights reserved
20
Handling Objections
▪ View objections as requests for information
▪ Anticipate specific objections
▪ Investigate the objection with the customer
▪ Be aware of competitors’ products
▪ Stay calm
▪ Use the objection to close the sale
LO6
Copyright ©2009 by Cengage Learning Inc. All rights reserved
21
LO6
Closing the Sale
Look for
customer signals
Keep an open mind
Negotiate
Tailor to each market
Copyright ©2009 by Cengage Learning Inc. All rights reserved
22
LO7 Sales Management Responsibilities
Define sales goals and sales process
Determine sales force structure
Recruit and train sales force
Compensate and motivate sales force
Evaluate sales force
Copyright ©2009 by Cengage Learning Inc. All rights reserved
23
LO7
Defining Sales Goals
Clear
Precise
Measurable
•Sales Volume
•Market Share
•Profit Level
•Quota
Time Specific
Copyright ©2009 by Cengage Learning Inc. All rights reserved
24
LO7
Sales Force Structure
Geographic region
Product line
Marketing function
Market or industry
Individual client
or account
Copyright ©2009 by Cengage Learning Inc. All rights reserved
25
LO7
Training the Sales Force
Company policies
and practice
Selling techniques
Training
includes...
Product knowledge
Industry and customer
characteristics
Nonselling duties
Copyright ©2009 by Cengage Learning Inc. All rights reserved
26
Compensating the Sales Force
Commission
Combination
Plans
Salary
LO7
Copyright ©2009 by Cengage Learning Inc. All rights reserved
27
LO7
Motivating the Sales Force
Rewards and incentives include:
▪
▪
▪
▪
▪
▪
▪
▪
▪
Ceremonies
Plaques
Vacations
Merchandise
Pay raises
Cash bonuses
Stock options
Tuition assistance
Product discounts
Copyright ©2009 by Cengage Learning Inc. All rights reserved
28
LO7 Evaluating the Sales Force
Sales volume
Contribution to profit
Calls per order
Sales or profits per call
Call percentage achieving goals
Copyright ©2009 by Cengage Learning Inc. All rights reserved
29
Pricing Concepts
CHAPTER
19
Marketing
10
Lamb, Hair, McDaniel
Designed by
Eric Brengle
B-books, Ltd.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Prepared by
Amit Shah
Frostburg State University
1
LOI
The Importance of Price
To the seller...
Price is revenue
To the consumer...
Price is the cost
of something
Price allocates resources
in a free-market economy
Copyright ©2009 by Cengage Learning Inc. All rights reserved
2
LOI
What Is Price?
Price
Price is that which is given up
in an exchange to acquire a
good or service.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
3
LOI
The Importance of Price to
Marketing Managers
Revenue
Profit
The price charged to
customers multiplied by the
number of units sold.
Revenue minus expenses.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
4
LO2
Pricing Objectives
Profit-Oriented
Sales-Oriented
Status Quo
Copyright ©2009 by Cengage Learning Inc. All rights reserved
5
LO2
Profit-Oriented Pricing
Objectives
Profit-Oriented Pricing Objectives
Profit
Maximization
Satisfactory
Profits
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Target
Return on
Investment
6
LO2
Sales-Oriented Pricing
Objectives
Sales-Oriented Pricing Objectives
Market
Share
Sales
Maximization
http://www.target.com
http://www.walmart.com
http://www.jcpenney.com
Online
Copyright ©2009 by Cengage Learning Inc. All rights reserved
7
LO2
Status Quo Pricing Objectives
Status Quo Pricing Objectives
Maintain
existing
prices
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Meet
competition’s
prices
8
LO3
The Demand Determinant of Price
Demand
Supply
The quantity of a product that
will be sold in the market at
various prices for a specified
period.
The quantity of a product
that will be offered to the market
by a supplier at various prices
for a specific period.
http://www.ubid.com
Online
Copyright ©2009 by Cengage Learning Inc. All rights reserved
9
The Demand Curve
LO3
Copyright ©2009 by Cengage Learning Inc. All rights reserved
10
The Supply Curve
LO3
Copyright ©2009 by Cengage Learning Inc. All rights reserved
11
LO3
How Demand and Supply Establish Price
Price
Equilibrium
The price at which demand
and supply are equal.
Elasticity
of Demand
Consumers’ responsiveness
or sensitivity to changes
in price.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
12
Price Equilibrium
LO3
Copyright ©2009 by Cengage Learning Inc. All rights reserved
13
LO3
Elasticity of Demand
Elastic
Demand
Inelastic
Demand
Unitary
Elasticity
▪
Consumers buy more or less
of a product when the
price changes.
▪
An increase or decrease in
price will not significantly
affect demand.
▪
An increase in sales exactly
offsets a decrease in prices,
and revenue is unchanged.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
14
LO3
Elasticity of Demand
Elasticity (E)
=
Percentage change in quantity
demanded of good A
Percentage change in price of good A
If E is greater than 1, demand is elastic.
If E is less than 1, demand is inelastic.
If E is equal to 1, demand is unitary.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
15
LO3
Factors that Affect Elasticity of Demand
Availability of substitutes
Price relative to
purchasing power
Product durability
A product’s other uses
Rate of inflation
http://www.columbiahouse.com
Online
Copyright ©2009 by Cengage Learning Inc. All rights reserved
16
LO5
The Cost Determinant of Price
Types of Costs
Variable
Cost
Fixed Cost
Varies with changes
in level of output
Does not change
as level of output changes
Copyright ©2009 by Cengage Learning Inc. All rights reserved
17
Break-Even Pricing
Break-Even
Quantity
Fixed cost
Contribution
LO5
=
=
Total fixed costs
Fixed cost contribution
Price - Avg. Variable Cost
Copyright ©2009 by Cengage Learning Inc. All rights reserved
18
LO6
Other Determinants of Price
Stages of the
Product Life Cycle
Competition
Distribution Strategy
Promotion Strategy
Perceived Quality
Copyright ©2009 by Cengage Learning Inc. All rights reserved
19
LO6
Stages in the Product Life Cycle
Introductory
Stage
Growth
Stage
Maturity
Stage
$
$
$
High
Stable
Decrease
Decline
Stage
$
Decrease
Stable
High
Copyright ©2009 by Cengage Learning Inc. All rights reserved
20
LO6
The Competition
• High prices may induce firms to enter the
market
• Competition can lead to price wars
• Global competition may force firms to
lower prices
Copyright ©2009 by Cengage Learning Inc. All rights reserved
21
LO6
The Impact of the Internet
Product selection
Second opinions from expert sites
Shopping bots
Internet auctions
Copyright ©2009 by Cengage Learning Inc. All rights reserved
22
LO6
Promotion Strategy/Price
Guarantee
Promotion Strategy
•
Price used as promotional tool
•
Pricing can also be a tool for trade
promotions
Price Guarantee
•
Match any competitor’s price
•
Signals to target market it is positioned as a
low-price dealer
Copyright ©2009 by Cengage Learning Inc. All rights reserved
23
LO6 The
Relationship of Price to Quality
Prestige Pricing
Charging a high price to help
promote a high-quality image.
http://www.vivre.com
http://www.ashford.com
Online
Copyright ©2009 by Cengage Learning Inc. All rights reserved
24
Setting the Right Price
CHAPTER
20
Marketing
Designed by
Eric Brengle
B-books, Ltd.
10
Lamb, Hair, McDaniel
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Prepared by
Amit Shah
Frostburg State University
1
LOI
How to Set a Price on a
Product or Service
Establish pricing goals
Estimate demand, costs, and profits
Choose a price strategy
Fine tune with pricing tactics
Results lead to the right price
Copyright ©2009 by Cengage Learning Inc. All rights reserved
2
Establish Pricing Goals
Profit-Oriented
Sales-Oriented
Status Quo
LOI
Copyright ©2009 by Cengage Learning Inc. All rights reserved
3
LOI
Choose a Price Strategy
Price
Skimming
A firm charges a high
introductory price, often coupled
with heavy promotion.
Penetration
Pricing
A firm charges a relatively low
price for a product initially as
a way to reach the mass market.
Status Quo
Pricing
Charging a price identical to or
very close to the competition’s
price.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
4
LOI
Price Skimming
Inelastic Demand
Situations
When
Price
Skimming
Is
Successful
Unique Advantages/Superior
Legal Protection of Product
Technological Breakthrough
Blocked Entry to Competitors
Copyright ©2009 by Cengage Learning Inc. All rights reserved
5
LOI
Penetration Pricing
Advantages
▪
▪
▪
Discourages or blocks
competition from
market entry
Boosts sales and
provides large profit
increases
Disadvantages
▪
Requires gear up for
mass production
▪
Selling large volumes
at low prices
▪
Strategy to gain market
share may fail
Can justify production
expansion
http://www.iflyswa.com
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Online
6
LOI
Status Quo Pricing
Advantages
▪
Simplicity
▪
Safest route to longterm survival for small
firms
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Disadvantages
▪
Strategy may ignore
demand and/or cost
7
LO2
The Legality and Ethics of
Price Strategy
Unfair Trade
Practices
Laws that prohibit wholesalers
and retailers from selling
below cost.
Price
Fixing
An agreement between two
or more firms on the price they
will charge for a product.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
8
LO2
Price Discrimination
The Robinson-Patman Act of 1936:
1. There must be price discrimination.
2. Transaction must occur in interstate commerce.
3. Seller must discriminate by price among two or more purchasers.
4. Products sold must be commodities or tangible goods.
5. Products sold must be of like grade and quality.
6. There must be significant competitive injury.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
9
LO2
Predatory Pricing
Predatory
Pricing
The practice of charging a
very low price for a
product with the intent of
driving competitors out of
business or out of a
market.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
10
LO3 Tactics for Fine-Tuning the
Base Price
Discounts
Geographic pricing
Special pricing tactics
Copyright ©2009 by Cengage Learning Inc. All rights reserved
11
LO3
Discounts, Allowances, Rebates, and
Value-Based Pricing
Quantity Discounts
Promotional Allowances
Cash Discounts
Rebates
Functional Discounts
Zero Percent Financing
Seasonal Discounts
Markdown Money
Value-Based Pricing
Copyright ©2009 by Cengage Learning Inc. All rights reserved
12
LO3
Value-Based Pricing
Value-Based
Pricing
Setting the price at a level that
seems to the customer to be a
good price compared to the
prices of other options.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
13
Pricing Products Too Low
1. Managers attempt to buy market share
through aggressive pricing.
2. Managers tend to make pricing decisions
based on short-term (current costs, current
competitor prices, and short-term share
gains) rather than on long-term profitability.
LO3
Copyright ©2009 by Cengage Learning Inc. All rights reserved
14
LO3
Other Pricing Tactics
Single-Price Tactic
All goods offered at the same price
Flexible Pricing
Different customers pay different price
Professional
Services Pricing
Used by professionals with experience,
training or certification
Price Lining
Several line items at specific price points
Leader Pricing
Sell product at near or below cost
Bait Pricing
Odd-Even Pricing
Price Bundling
Two-Part Pricing
Lure customers through false or misleading
price advertising
Odd-number prices imply bargain
Even-number prices imply quality
Combining two or more products in a
single package
Two separate charges to consume a single good
Copyright ©2009 by Cengage Learning Inc. All rights reserved
15
LO5
Pricing during Difficult
Economic Times
Describe the role of pricing
during periods of
inflation and recession
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16
LO5
Inflation
Cost-Oriented Tactics
High Inflation
Demand-Oriented Tactics
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17
Cost-Oriented Tactics
Problems with Cost-Oriented Tactics
▪ A high volume of sales on an item with a low
profit margin may still make the item highly
profitable.
▪ Eliminating a product may reduce economies
of scale.
▪ Eliminating a product may affect the
price-quality image of the entire line.
LO5
Copyright ©2009 by Cengage Learning Inc. All rights reserved
18
Demand-Oriented Tactics
Cultivate selected demand
Strategies
to Make
Demand
More Inelastic
Create unique offerings
Change the package design
Heighten buyer dependence
LO5
Copyright ©2009 by Cengage Learning Inc. All rights reserved
19
LO5
Recession
Value-Based Pricing
Bundling or Unbundling
Copyright ©2009 by Cengage Learning Inc. All rights reserved
20
LO5
Supplier Strategies During
Recession
Renegotiating contracts
Offering help
Keeping the pressure on
Paring down suppliers
Copyright ©2009 by Cengage Learning Inc. All rights reserved
21
Customer Relationship Management (CRM)
CHAPTER
21
Marketing
10
Lamb, Hair, McDaniel
Designed by
Eric Brengle
B-books, Ltd.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Prepared by
Amit Shah
Frostburg State University
1
LOI
Customer Relationship Management
Customer
Relationship
Management
A company-wide business
strategy designed to optimize
profitability, revenue, and
customer satisfaction by
focusing on highly defined
and precise customer groups.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
2
LOI
Customer Relationship
Management Cycle
Identify customer relationships
Leverage customer
information
Understand interactions
with current customer base
Identify best customers
Capture customer data
based on interactions
Store and integrate
customer data using IT
Copyright ©2009 by Cengage Learning Inc. All rights reserved
3
LO2
Identify Customer Relationships
Customer-Centric
The company customizes its
product and service offering
based on data generated
through interactions between
the customer and the company.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
4
LO2
Knowledge Management
Experiential
observations
Comments
Collected
Information
Includes:
Customer actions
Qualitative facts
Copyright ©2009 by Cengage Learning Inc. All rights reserved
5
LO3
Interactions of the
Current Customer Base
Current
transaction
Channel
Customer
Past
Relationship
Requested
Service
Copyright ©2009 by Cengage Learning Inc. All rights reserved
6
LO3
Interactions of the
Current Customer Base
Touch Points
All possible areas of a business
where customers communicate
with that business.
Point-of-Sale
Interactions
Communications between
customers and organizations that
occur at the point of sale,
normally in a store.
http://www.bestbuy.com
Online
Copyright ©2009 by Cengage Learning Inc. All rights reserved
7
LO4
Capture Customer Data
Store visits
Conversations with salespeople
Interactions via the Web
Traditional phone conversations
Wireless communications
http://www.geico.com
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Online
8
LO6
Identifying the Best Customers
Data
Mining
A data analysis procedure
that identifies significant
patterns of variables and
characteristics that pertain to
particular customers or
customer groups.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
9
LO6
Data Analysis
Customer segmentation
Recency-frequency-monetary analysis
Lifetime value analysis
Predictive modeling
Copyright ©2009 by Cengage Learning Inc. All rights reserved
10
LO6
Customer Segmentation
• The process of breaking large groups of
customers into smaller, more homogeneous
groups
• Generates a “profile” or picture of the
customers’ similar demographic, geographic,
and psychographic traits
• Focuses on best customers
Copyright ©2009 by Cengage Learning Inc. All rights reserved
11
LO6
Recency-Frequency-Monetary
Analysis
1. Identifies customers mostly like to
purchase again
2. Identifies and ranks “best customers”
3. Identifies most profitable customers
Copyright ©2009 by Cengage Learning Inc. All rights reserved
12
LO6
Data Manipulation Techniques
Lifetime
Value Analysis
A data manipulation technique
that projects the future value of
the customer over a period of
years.
Predictive
Modeling
A data manipulation technique
in which marketers try to
determine what the odds are
that some other occurrence will
take place in the future.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
13
LO7
CRM Marketing Database Applications
Campaign management
Reinforcing customer
purchase decisions
Retain loyal
customers
Inducing product trial
by new customers
Cross-selling other
products and services
Increasing effectiveness
of distribution channel
marketing
Designing targeted
marketing communications
Improving
customer service
Copyright ©2009 by Cengage Learning Inc. All rights reserved
14
Retaining Loyal Customers
Retaining an additional 5 percent of customers
increases profits by as much as 25 percent
Improving customer retention by 2 percent can
decrease costs by as much as 10 percent
Loyalty programs reward loyal customers for
making multiple purchases
Loyalty programs provide information
about customers and trends
LO7
Copyright ©2009 by Cengage Learning Inc. All rights reserved
15
Cross–selling other
products and services
• CRM provides opportunities to cross-sell
related products
•Cross-sell to customers with demographic,
lifestyle, or behavioral characteristic matches
•Internet companies use product and
customer profiling to reveal cross-selling
opportunities
LO7
Copyright ©2009 by Cengage Learning Inc. All rights reserved
16
LO7
Targeted Marketing
Communications
Infrequent
Users
• Offer direct incentives,
such as a price
discount
Moderate
Users
• Offer more
reinforcement of past
purchase decisions
Heavy
Users
• Design around loyalty
and reinforcement
of purchase
Copyright ©2009 by Cengage Learning Inc. All rights reserved
17
LO7
Reinforcing Customer Purchase
Decisions
•Cognitive dissonance is the feeling consumers
experience when they recognize inconsistency
between values and opinions and their
purchase behavior
•Thanking customers help cement a long-term,
profitable relationship
•Update customers periodically on the status
of their order
Copyright ©2009 by Cengage Learning Inc. All rights reserved
18
Increasing Effectiveness of
Distribution Channel Marketing
RFID technology
Multichannel Marketing
CRM Databases
http://www.kidsdadsmoms.com
LO7
Online
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19
Improving Customer Service
•Level of customer service is influential in
customer retention
•Customer retention – the percentage of
customers that repeatedly purchase products
from a company
LO7
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20
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