Page 48 - DMGT308_CUSTOMER_RELATIONSHIP_MANAGEMENT

Unit 2: Customer Value

(2) interactions with customers, supported by expertise in recruitment and training, service Notes
quality, and operations. Similarly, much of the value created by the Sharkey’s franchise is
also in the purchase/consumption environment and customer interactions. This is to be
expected with consumer services. For goods, one might expect greater focus on value
creating processes relating to product development and manufacturing. In business-to-
business contexts, there may be greater focus on the value created by means of interactions
(social-relational value) and ownership transfer activities (distribution, logistics, etc.).

Marketing Research

The framework also provides some direction for operationalising the customer value creation
strategy construct. Such a construct could be viewed as having four main facets or dimensions
relating to the four types of value described.
A battery of questions could then be developed for each dimension and sub dimension based on
the key sources of value. Items could then be summed across sources of value to create formative
indices of functional/instrumental, experiential/hedonic, symbolic/expressive, and cost/sacrifice
value, similar to a “balanced scorecard” approach (e.g., Kaplan and Norton 1992). Alternatively,
the framework could be used to assess the customer value creation strategy of an organization
by means of content analysis of business plans, marketing plans, communication plans, or other
documents and materials that describe marketing activity.

Task Explain the framework of value creation.

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Case Study Nestle: Helping to Develop Local Dairy Industry

estle’s dairy development heritage in India began humbly in Moga on 15
November 1961, collecting only 511 kgs of milk on our first day. Today Nestlé’s
NMoga factory collects over 1.3 million kgs of milk per day during the flush
season, with over 110,000 farmers in India selling milk to Nestlé.

Nestlé’s milk collection area has expanded over the years and today covers 30,000 square
kilometres. We have also constructed 2,815 milk collection centres in villages across the
country to facilitate our considerable daily milk collection.
One of Nestlé’s many success stories in the dairy sector is that of milk farmer Jagdeep
Singh Sandhu, who hails from the village Assal in Ferozepur. Jagdeep began dairy farming
in 2001 with one buffalo as he found the milk market remunerative. By 2004, he had
managed to gradually increase his herd of buffaloes to 25. He soon associated himself
with Nestlé who, by 2007, had assisted him in procuring a loan and encouraged him to
increase his cow herd to 36 animals. In 2008, Nestlé sponsored Jagdeep’s visit to the World
Dairy Exposition in USA to gain more knowledge regarding commercial dairy farming.
After his visit, Nestlé introduced best practices for dairy farming at his farm, including
better calf management, silage preparation and shed expansion.
With the adaptation of best practices at Jagdeep’s farm, he soon saw increased milk
productivity. Nestlé consequently installed a milk chilling facility at his farm to ensure
‘chilling at source’. In 2010, we also installed a milking parlour at his farm.
Contd...

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