Archive for Consumer Psychology

Relationship Marketing – Company and Marketing Perspective

Posted in Consumer Behavior, CRM, eMarketing, Management, Marketing Mix (New Concepts) with tags , , , , , , , , , on December 19, 2011 by Consultant
We are living in the high tech times. Technology and changing economy have changed the rules the way a business is done. Business organizations have to tune in to various markets and know the customers well. The successful companies are those who have been able to anticipate the customer need and innovate future products leveraging on technology. In a global as well as local scenario, customer holds the key to the growth of business and organizations. No wonder that when you open your mail box or your email, you are always flooded with marketing communication from all possible companies trying to build a relationship with you. Take a look at the cards in your wallet and you must be holding quite a few membership cards that make you feel privileged and keeping bringing rewards and prompting you to extend your relationship with them.

Relationship Marketing has never been more important for the Organizations as it has been now. In the field where competition is intense and life cycle of products and services is very small, customer relationship has emerged to be one of the key drivers to contribute a large chunk of sales revenue. When we talk of relationship marketing, we are not referring to customer service. Customer service refers to the quality of service on a transactional mode. By Relationship Marketing, we are referring to the level of Relationship that exists between the customer and the company.

In terms of Relationship, there can be several ways of defining or measuring the quality of relationship with the Customer. Understanding of the depth of relationship and qualifying can help the Company in improving its reach to the markets as well as work towards increasing the depth of the relationship with the customer. In the first instance, we have a happy customer who has bought the product or a service and found it satisfactory.

When the Company reaches out to communicate with him and anticipate his future needs, he can be converted to a faithful customer. A faithful customer may be a repeat customer who does continues to buy the product from the company on repeat basis without making an effort to look at alternatives. However, at this stage the customer can be influenced and be vulnerable to competition as well as price sensitivity. Relationship marketing by the Company can help convert this customer from a faithful customer to a loyal customer. A loyal customer is one who has made an informed decision to go with the particular Company, is happy with the product, is loyal to the brand and is likely to advocate the same brand to friends and family because he believes in the Product as well as the Company and values the relationship. Apart from customer service, there are several marketing programmes and loyalty programmes besides brand advertising that the Companies carry out to build the relationship with the customer.

Relationship marketing gets translated and implemented through the marketing strategies, promotional programs as well as through marketing communication programs. When implemented as a part of marketing strategy, the relationship is normally focussed on leveraging the brands and products of the Company with the customer. Besides the marketing activities, the Companies implement internal and external corporate communications too keeping in view the Customers.

Marketing strategies are required to define the relationship marketing strategies for each of the product or service category taking into account the geographies, the customer profile as well as the overall RM objective of the Company. The RM strategy in case of a product company would be different from that of a service company and the element of communication design strategy would need to be different for a product from that of a service. In case of a product, the Customer is likely to respond in terms of brand, tangible and quantifiable performance of the product and the satisfaction derived from post sales service. In case of service, however, there is no tangible product and the customer’s expectations are different when it comes to service that is mainly concentrated around his perceptions and experience.

Therefore understanding the concept of Relationship marketing, the difference between RM and Customer Service as well as the ways and means of implementing or achieving RM objectives through effective marketing strategies is important for all the marketing managers and students who are going to be the drivers to defining, planning, detailing and implementing marketing strategies. An effective Marketing Manager should be able to effectively design marketing policies and strategies that are aligned with the Company’s RM objective and help build the relationship between the Company and Customer, Partners as well as the intermediaries who are critical to one’s business.

Posted in B2B, Brand Managment, Consumer Behavior, CRM, eMarketing, Management, Marketing Mix (New Concepts) with tags , , , , , , , , , , , , on December 1, 2011 by Consultant

Importance of Motivation

Motivation is a very important for an organization because of the following benefits it provides:-

  1. Puts human resources into action

    Every concern requires physical, financial and human resources to accomplish the goals. It is through motivation that the human resources can be utilized by making full use of it. This can be done by building willingness in employees to work. This will help the enterprise in securing best possible utilization of resources.

  2. Improves level of efficiency of employees

    The level of a subordinate or a employee does not only depend upon his qualifications and abilities. For getting best of his work performance, the gap between ability and willingness has to be filled which helps in improving the level of performance of subordinates. This will result into-

    1. Increase in productivity,
    2. Reducing cost of operations, and
    3. Improving overall efficiency.
  3. Leads to achievement of organizational goals

    The goals of an enterprise can be achieved only when the following factors take place :-

    1. There is best possible utilization of resources,
    2. There is a co-operative work environment,
    3. The employees are goal-directed and they act in a purposive manner,
    4. Goals can be achieved if co-ordination and co-operation takes place simultaneously which can be effectively done through motivation.
  4. Builds friendly relationship

    Motivation is an important factor which brings employees satisfaction. This can be done by keeping into mind and framing an incentive plan for the benefit of the employees. This could initiate the following things:

    1. Monetary and non-monetary incentives,
    2. Promotion opportunities for employees,
    3. Disincentives for inefficient employees.

    In order to build a cordial, friendly atmosphere in a concern, the above steps should be taken by a manager. This would help in:

    1. Effective co-operation which brings stability,
    2. Industrial dispute and unrest in employees will reduce,
    3. The employees will be adaptable to the changes and there will be no resistance to the change,
    4. This will help in providing a smooth and sound concern in which individual interests will coincide with the organizational interests,
    5. This will result in profit maximization through increased productivity.
  5. Leads to stability of work force

    Stability of workforce is very important from the point of view of reputation and goodwill of a concern. The employees can remain loyal to the enterprise only when they have a feeling of participation in the management. The skills and efficiency of employees will always be of advantage to employees as well as employees. This will lead to a good public image in the market which will attract competent and qualified people into a concern. As it is said, “Old is gold” which suffices with the role of motivation here, the older the people, more the experience and their adjustment into a concern which can be of benefit to the enterprise.

From the above discussion, we can say that motivation is an internal feeling which can be understood only by manager since he is in close contact with the employees. Needs, wants and desires are inter-related and they are the driving force to act. These needs can be understood by the manager and he can frame motivation plans accordingly. We can say that motivation therefore is a continuous process since motivation process is based on needs which are unlimited. The process has to be continued throughout.

We can summarize by saying that motivation is important both to an individual and a business. Motivation is important to an individual as:

  1. Motivation will help him achieve his personal goals.
  2. If an individual is motivated, he will have job satisfaction.
  3. Motivation will help in self-development of individual.
  4. An individual would always gain by working with a dynamic team.

Similarly, motivation is important to a business as:

  1. The more motivated the employees are, the more empowered the team is.
  2. The more is the team work and individual employee contribution, more profitable and successful is the business.
  3. During period of amendments, there will be more adaptability and creativity.
  4. Motivation will lead to an optimistic and challenging attitude at work place.

Posted in B2B, Brand Managment, Consumer Behavior, Management with tags , , , , , , , , , , , on December 1, 2011 by Consultant

Motivation Incentives – Incentives to motivate employees

Incentive is an act or promise for greater action. It is also called as a stimulus to greater action. Incentives are something which are given in addition to wagers. It means additional remuneration or benefit to an employee in recognition of achievement or better work. Incentives provide a spur or zeal in the employees for better performance. It is a natural thing that nobody acts without a purpose behind. Therefore, a hope for a reward is a powerful incentive to motivate employees. Besides monetary incentive, there are some other stimuli which can drive a person to better. This will include job satisfaction, job security, job promotion, and pride for accomplishment. Therefore, incentives really can sometimes work to accomplish the goals of a concern. The need of incentives can be many:-

  1. To increase productivity,
  2. To drive or arouse a stimulus work,
  3. To enhance commitment in work performance,
  4. To psychologically satisfy a person which leads to job satisfaction,
  5. To shape the behavior or outlook of subordinate towards work,
  6. To inculcate zeal and enthusiasm towards work,
  7. To get the maximum of their capabilities so that they are exploited and utilized maximally.

Therefore, management has to offer the following two categories of incentives to motivate employees:-

  1. Monetary incentives- Those incentives which satisfy the subordinates by providing them rewards in terms of rupees. Money has been recognized as a chief source of satisfying the needs of people. Money is also helpful to satisfy the social needs by possessing various material items. Therefore, money not only satisfies psychological needs but also the security and social needs. Therefore, in many factories, various wage plans and bonus schemes are introduced to motivate and stimulate the people to work.
  2. Non-monetary incentives- Besides the monetary incentives, there are certain non-financial incentives which can satisfy the ego and self- actualization needs of employees. The incentives which cannot be measured in terms of money are under the category of “Non- monetary incentives”. Whenever a manager has to satisfy the psychological needs of the subordinates, he makes use of non-financial incentives. Non- financial incentives can be of the following types:-
    1. Security of service- Job security is an incentive which provides great motivation to employees. If his job is secured, he will put maximum efforts to achieve the objectives of the enterprise. This also helps since he is very far off from mental tension and he can give his best to the enterprise.
    2. Praise or recognition- The praise or recognition is another non- financial incentive which satisfies the ego needs of the employees. Sometimes praise becomes more effective than any other incentive. The employees will respond more to praise and try to give the best of their abilities to a concern.
    3. Suggestion scheme- The organization should look forward to taking suggestions and inviting suggestion schemes from the subordinates. This inculcates a spirit of participation in the employees. This can be done by publishing various articles written by employees to improve the work environment which can be published in various magazines of the company. This also is helpful to motivate the employees to feel important and they can also be in search for innovative methods which can be applied for better work methods. This ultimately helps in growing a concern and adapting new methods of operations.
    4. Job enrichment- Job enrichment is another non- monetary incentive in which the job of a worker can be enriched. This can be done by increasing his responsibilities, giving him an important designation, increasing the content and nature of the work. This way efficient worker can get challenging jobs in which they can prove their worth. This also helps in the greatest motivation of the efficient employees.
    5. Promotion opportunities- Promotion is an effective tool to increase the spirit to work in a concern. If the employees are provided opportunities for the advancement and growth, they feel satisfied and contented and they become more committed to the organization.

    The above non- financial tools can be framed effectively by giving due concentration to the role of employees. A combination of financial and non- financial incentives help together in bringing motivation and zeal to work in a concern.

Positive Incentives

Positive incentives are those incentives which provide a positive assurance for fulfilling the needs and wants. Positive incentives generally have an optimistic attitude behind and they are generally given to satisfy the psychological requirements of employees. For example-promotion, praise, recognition, perks and allowances, etc. It is positive by nature.

Negative Incentives

Negative incentives are those whose purpose is to correct the mistakes or defaults of employees. The purpose is to rectify mistakes in order to get effective results. Negative incentive is generally resorted to when positive incentive does not works and a psychological set back has to be given to employees. It is negative by nature. For example- demotion, transfer, fines, penalties.

Posted in Brand Managment, Consumer Behavior, CRM, Management, Marketing Mix (New Concepts), Search Engine Optimization with tags , , , , , , , , , , on December 1, 2011 by Consultant

What is Motivation ?

Motivation is the word derived from the word ’motive’ which means needs, desires, wants or drives within the individuals. It is the process of stimulating people to actions to accomplish the goals. In the work goal context the psychological factors stimulating the people’s behaviour can be –

  • desire for money
  • success
  • recognition
  • job-satisfaction
  • team work, etc

One of the most important functions of management is to create willingness amongst the employees to perform in the best of their abilities. Therefore the role of a leader is to arouse interest in performance of employees in their jobs. The process of motivation consists of three stages:-

  1. A felt need or drive
  2. A stimulus in which needs have to be aroused
  3. When needs are satisfied, the satisfaction or accomplishment of goals.

Therefore, we can say that motivation is a psychological phenomenon which means needs and wants of the individuals have to be tackled by framing an incentive plan.

Posted in B2B, Brand Managment, Consumer Behavior, CRM, eMarketing, Management, Marketing Mix (New Concepts), Search Engine Optimization with tags , , , , , , , , , , on December 1, 2011 by Consultant

Disadvantages of Planning

Internal Limitations

There are several limitations of planning. Some of them are inherit in the process of planning like rigidity and other arise due to shortcoming of the techniques of planning and in the planners themselves.

  1. Rigidity
    1. Planning has tendency to make administration inflexible.
    2. Planning implies prior determination of policies, procedures and programmes and a strict adherence to them in all circumstances.
    3. There is no scope for individual freedom.
    4. The development of employees is highly doubted because of which management might have faced lot of difficulties in future.
    5. Planning therefore introduces inelasticity and discourages individual initiative and experimentation.

     

     

  2. Misdirected Planning
    1. Planning may be used to serve individual interests rather than the interest of the enterprise.
    2. Attempts can be made to influence setting of objectives, formulation of plans and programmes to suit ones own requirement rather than that of whole organization.
    3. Machinery of planning can never be freed of bias. Every planner has his own likes, dislikes, preferences, attitudes and interests which is reflected in planning.

     

     

  3. Time consuming

     

    1. Planning is a time consuming process because it involves collection of information, it’s analysis and interpretation thereof. This entire process takes a lot of time specially where there are a number of alternatives available.
    2. Therefore planning is not suitable during emergency or crisis when quick decisions are required.

     

     

  4. Probability in planning
    1. Planning is based on forecasts which are mere estimates about future.
    2. These estimates may prove to be inexact due to the uncertainty of future.
    3. Any change in the anticipated situation may render plans ineffective.
    4. Plans do not always reflect real situations inspite of the sophisticated techniques of forecasting because future is unpredictable.
    5. Thus, excessive reliance on plans may prove to be fatal.

     

     

  5. False sense of security
    1. Elaborate planning may create a false sense of security to the effect that everything is taken for granted.
    2. Managers assume that as long as they work as per plans, it is satisfactory.
    3. Therefore they fail to take up timely actions and an opportunity is lost.
    4. Employees are more concerned about fulfillment of plan performance rather than any kind of change.

     

     

  6. Expensive
    1. Collection, analysis and evaluation of different information, facts and alternatives involves a lot of expense in terms of time, effort and money
    2. According to Koontz and O’Donell, ’ Expenses on planning should never exceed the estimated benefits from planning. ’

     

External Limitations of Planning

  1. Political Climate- Change of government from Congress to some other political party, etc.
  2. Labour Union- Strikes, lockouts, agitations.
  3. Technological changes- Modern techniques and equipments, computerization.
  4. Policies of competitors- Eg. Policies of Coca Cola and Pepsi.
  5. Natural Calamities- Earthquakes and floods.
  6. Changes in demand and prices- Change in fashion, change in tastes, change in income level, demand falls, price falls, etc.

Posted in B2B, Brand Managment, Consumer Behavior, CRM, eMarketing, Marketing Mix (New Concepts) with tags , , , , , , , on November 30, 2011 by Consultant

Top US Brands Getting Strategic About Social Media

Over the past year, America’s top brands have made improvements in how they use online branded communities to reach their customers, but some opportunities for engagement remain untapped, according to a new report by ComBlu.

More brands are taking a strategic approach to social media engagement in 2011. Among the 251 online branded communities studied, managed by 92 brands: 

  • 41% of brands now have a cohesive strategy for social engagement in which multiple activities roll into a single online experience, compared with 33% in 2010, and 20% in 2009. 
  • The social experimentation stage is most prevalent: 50% of brands are experimenting with social communities, lacking a long-term engagement approach, using instead a series of one-off experimental marketing campaigns. That level is up from 45% in 2010.
  • Community ghost towns (unpopulated communities) now make up 5% of communities, down from 15% in 2010.
  • Community overload (multiple communities fighting for attention from the same audience) afflicts 4% of online communities, down from 5% in 2009.


Below, additional findings from the third annual “State of Online Branded Communities” issued by ComBlu.

Community Engagement Strategies

Some brands are using multiple strategies of engagement within the same community.

ComBlu defines three such strategies, or “pillars” of engagement as the following: 

  • Advocacy is essentially word-of-mouth marketing around a product, service, issue or idea to develop deeper relationships with stakeholders or activate them to support a specific mission.
  • Support refers to using customer experts to provide or extend the customer service (includes post-purchase and support forums).
  • Feedback refers to crowd sourcing new ideas for products or services, or gathering input on product quality, customer experience, marketing campaigns, and messaging.

Among the communities studied, most (75%) are focused on advocacy, whereas 33% focus on customer support and 20% focus their efforts on customer feedback.

Adoption of Best Practices

Over the past year, many brands adjusted their social media engagement tactics; among key changes:

  • The presence of a community manager fell to 48% in 2011, down from 51% in 2010.
  • The adoption of user reviews and content fell to 27%, from 54% in 2010. 
  • The use of advocates in online branded communities remained unchanged at 20%.

Among the most significant gains in the adoption of best practices: 

  • More brands implemented personal dashboards, from 38% in 2010 to 60% in 2011. 
  • Content aggregation (share features, content rating, and social bookmarking) registered sharp gains, to 95% in 2011, from 32% in 2010.

Among other best practices, 43% of communities offer rewards and recognition programs, up from 39% in 2010, while 16% offer a mobile app. 


Looking for real, hard data that can help you match social media tools and tactics to your marketing goals? The State of Social Media Marketing, a 240-page original research report from MarketingProfs, gives you the inside scoop on how 5,140 marketing pros are using social media to create winning campaigns, measure ROI, and reach audiences in new and exciting ways.


Top-Performing Brands

One-third (33%) of brands were ranked as high performers, based on their adoption of best practices. On a scale of 0 to 60, such high performers received a minimum of 42 points.

Among the highest performers, Verizon Communications led with 55 points; followed by EA and SAP with 54 points; Bravo, Intel, and Sony with 52 points, American Express with 51 points; and Discovery Channel, Microsoft, Sears, Whole Foods, and Sony with 50 points. 

Top-Performing Industries

Among the 16 industries in the study, the gaming and telecom industries were the two highest scoring (with 45 points each), followed closely by technology and consumer electronics (43 points). 

The retail and travel/hospitality industries tied for the most improved, each jumping nine points in average score.

About the data: The audit of 251 online branded communities among 92 US companies was conducted by ComBlu during the summer of 2011.

Posted in Brand Managment, Consumer Behavior, CRM with tags , , , , , , , , , , , , on November 30, 2011 by Consultant

Challenge the Status Quo! Take on a Dominant Market Player [Slide Show]

111118-01. Intro111118-02. 1. Establish your brand111118-03. 2. Build trust
111118-04. 3. Do something different111118-05. 4. Dive in111118-06. 5. Be patient
111118-01. Intro

We all learned on the playground in elementary school that it’s never a good idea to take on the big kid. That first physics lesson we learned—that larger objects push harder than smaller ones—reinforced that notion in our rapidly developing, dodgeball-obsessed minds.

But was that really an accurate lesson? After all, ordinary-sized David defeated giant-sized Goliath with nothing more than a pebble and a slingshot. So why can’t you? The answer is, You can! But to effectively beat the giant in your industry, you’ll need to focus on these five things.

111118-02. 1. Establish your brand

1. Establish your brand

As a startup, establishing your brand is the first and most important step in building a business. Coming in as a new player, you will encounter uncertainty about your brand from potential consumers who are unfamiliar with your name, products, quality, differentiation, etc. But you can use that to your advantage.

Humans have an innate curiosity and desire to explore. If you disagree, watch a young child be entertained for hours upon hours by ordinary objects, such as kitchen utensils or cell phones. Even though your target market has most likely grown out of playing with common objects for hours, that curiosity remains.

How can human curiosity benefit your brand? Draw on that human trait by positioning your business as something new and unique. Don’t give up all of your information up front; catch your targets’ interest and make them wonder. Their curiosity will take over and subconsciously motivate them to seek, search, and investigate, which will ultimately drive traffic to your website. Then, it’s your job to get them to stay.

So, how do you keep the market share you’ve gained?

111118-03. 2. Build trust

2. Build trust

Customers will not give you their money if they do not trust you. As a new company, you’ll have a hard time building trust via past buying experiences, because your target market has likely never before bought from you. So the next best way to build immediate trust is to identify with your customers on a personal level. Be transparent. As a small business, you actually have the advantage; you aren’t viewed as a faceless corporate monster. Use that advantage to develop closeness with your customers, and you can bet that they will multiply.

111118-04. 3. Do something different

3. Do something different

Whatever you do, don’t try to enter a market dominated by a major player by using the exact same business model as the Goliath. Customers’ brand loyalty to the “big kid” will quickly destroy your business. But finding a way to improve or diversify the market will create an avenue for you to compete.

For example, my company created a new pay-per-click (PPC) billing model that was completely unique in the automotive industry. Having a unique offering allowed us to quickly develop strong relationships with suppliers and create the critical mass necessary to start driving traffic (pun intended) to Netcars.com, our website.

But what if being different doesn’t work? Another benefit you have as a small, upcoming competitor is flexibility. Exxon Mobil might not be able to change its business model overnight, but Mom and Pop’s Convenience Store can. So listen to customer feedback, integrate it, and adapt.

111118-05. 4. Dive in

4. Dive in

We’ve all been in a situation where it was necessary to “test the water.” When I go to the pool, I dip my toe in first to see how cold the water is. But that’s not going to work in a market dominated by a major player.

When you dip your toe into a big pool, you hardly create ripples. On the other hand, doing a cannonball into the pool would create major waves all around you.

When taking on a major player, then, your goal is to disrupt the market—to do a cannonball into the market. So, make your entrance a massive push. Market like hell. Prepare for growth. Staff early. Get the right people on board, and then figure out where they fit into your business as the ripples grow.

After all, you get only one shot to launch.

111118-06. 5. Be patient

5. Be patient

Penetrating a concentrated market isn’t a game of Jenga. (In that game, pulling out one block could cause an entire tower to topple.) Instead, making an impact on the market is more of a marathon, not a sprint. Cheesy analogies aside, don’t expect to bring down the competition overnight.

Keep your brand consistent and unique, continue to innovate, and challenge the status quo. Time will bring results.

* * *

You’ll still have to find your own pebble, but I hope this information will be the slingshot you need to take on the Goliath that your company faces. Happy hunting!