LECTURE

ON

Understanding Customer Preferences

4th week
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Strategies for Dealing with Customer

Market Segmentation
Un-segmented, Mass marketing Custom Marketing

Aggregated Standardized Offering Low cost / customer

One-to-one Tailored offering High cost / customer

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Strategies for Dealing with Customer

Un-segmented, Mass marketing:

Standardized offering Low cost / customer [ budget conscious customers, families

Architects, tailors, doctors and lawyers

Custom or one to one marketing

Market Segmentation
The basic logic behind a Market or customer segmentation
Not all buyers are alike, identical Identification of Subgroups with similar behaviours or value Target the unique needs of smaller groups or similar customers

Global [ Domestic Foreign] Domestic [ Consumer Business] Consumer [Dislikes, only little use, sophisticated user]

Ways to segment markets

Geographic Variables [GIS] Demographic variables Lifestyles and Psychographic Behavioural pattern Analytically Derived segments Personalize B2C Messages at the Right Level of Aggregation

Geographic
Demographic

Domestic/foreign/ global, regions, zip codes, climate, population density, terrain

Gender Income Age Education Marital status Family lifecycle Ethnicity Female, male <25000; 25000-64999>65000 Infant, child, preteen, teen young adult, elderly High, vocational schools, college, grad school Married, single, divorced, windowed Single no child, married with child, empty nest National identity sub-cultural identity

Lifestyles / Activities, interest, opinions and values Psychographics Behavioural RFM Channel Benefits sought Service required Loyalty Permission granted Data mining Recency frequency, monitoring Catalog, mail, tv, internet, specialty shop, store Lowest price, best technology, greatest value Telephone supported, in person, e-mail None, some emotionally, bonded, committed Also to send emails, mail or further phones Deal seekers, stock pilers, regularly prices, premium

Analytically derived

Customers Types by Expected Value

Expected Future Value to the Firm
High Low

Historical Value to the Firm

High

Premium

Uneconomical

Low

Prospect

Undesirable
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Customer Preference

<< Customer Preference

Emotive attributes = Relationship focused, refers to the treatment demanded and expectations of a customer from the provider [Dignity, authenticity, integrity, empathy, sincerity, timelines] Functional attributes = Product / service focused oftenly referred to the functional component of the offering [ Efficiency, consistency, availability, reliability responsiveness, convenience] Channels and touch points= Method of Interaction like telephone, e-mail, point of purchase, customer service desk or mail. 10 Product / services= Purchase of new automobile

<< Customer Preference

Interaction criticality = [Significance , vital, important of interaction] Intrusiveness of interaction [interference for interaction] Emotional relevance and personal importance Brand specific delivery expectations Baseline expectations
A shampoo of more suds A car of white or black colour

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