Page 24 - DMGT408DMGT203_Marketing Management

Unit 1: Marketing: Scope and Concepts

Notes
Table 1.2: Relationship of Expectations and Satisfaction
Level of Expectation
Perceived performance relative Below minimum desired Above minimum desired
to expectation performance performance
More than expected Satisfaction Satisfaction/Commitment
Same as expected Non-satisfaction Satisfaction
Worse than expected Dissatisfaction Dissatisfaction

The key to inducing brand loyalty among customers can only be achieved by delivering higher
value to delight customers than competitors. Satisfaction is basically a feeling of pleasure, and
marketers should be aware of satisfaction delivered by competitors and try to surpass that level
in an attempt to delight customers. Delivering higher value can lead to delighting customers
which, in turn, seems to be the key factor in developing loyalty, more so if the brand generates
emotional bonding. This emotional bonding is not just a preference based on rational content
but is largely feeling-based.

Tasks 1. Study a company in your city and identify what practices it has
adopted to meet the requirements of being customer-oriented.
2. Study a consumer durable marketing company. Discuss its important
practices that you think appear to keep in view the long-term welfare
of the society.

1.4.1 Value Chain

The way to generate high customer loyalty is to deliver high customer value by designing a
competitively superior value proposition aimed at a specific market segment backed by a
superior value-delivery system.
The value proposition consists of the whole cluster of benefits the company promises to deliver
and is basically a statement about the resulting experience customers will gain from the
company's market offering. The brand must present a promise which can only be kept depending
on how the company can manage its value-delivery system. The value-delivery system includes
all the experiences the customer will have on the way to obtaining and using the offering.
In a hyper-competitive economy, a company's success depends on how it can create and deliver
superior value. In order to do so, the company must develop the following five capabilities:
1. Understanding customer value

2. Creating customer value
3. Delivering customer value
4. Capturing customer value

5. Sustaining customer value
In order to succeed, therefore, the company needs to use the concept of value and a value-delivery
network.

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