When we do business, what we need the most is the customer. When we have a good product to sell but no customer who wants to buy, then it cannot be called business. In the real business world, there are lots of different types of customer that we are going to interact with and they can be classified into initiator, influencer, decider, buyer and user. In targeting the customer, we have to use different approach to suit the needs of different customer types.
Careful attention should be taken on building a relationship with customer because before purchasing the product, an expectation has already been created in the customer's mind and our job as business people are to reduce the gap between the customer's real experience with the expectation that they have. For sure, we cannot control the expectation created in every individual's head, however we can manipulate to increase this experience by applying these aspects to our business. The aspects are reliability, assurance, responsiveness, empathy and other tangible aspects like equipment and facilities.
In building good relationship with the customers, different strategies should be executed in different stages of customer development. For example, the strategy used in customer acquisition stage, satisfaction stage and loyalty stage should be different from the strategy used in customer retention stage. We have to go as far and as detailed about the customer's profile and interests to really satisfy the ones in the higher phase.
Lastly, there are lots of benefits that we will get from customer satisfaction. This may mean so much more than just repeat purchases, it may also lead to customer loyalty, good brand image, and customer fanaticism of a particular brand. All these benefits are the result of the deduction of customer costs to the customer value.
I am sure that everybody is familiar with the statement "customer is king". That statement is true, indeed, because customer is the most important aspect in business, without them profit and popularity cannot be earned thus may hinder the business from success. Customer satisfaction should be the company's priority, especially in the hospitality industry where service is the main subject. That is why we are taught about politeness and communication skills.
Monday, April 25, 2011
Monday, April 18, 2011
Marketing Channel
One really important thing that we need to lay down for business students is this: NETWORKING!
Networking is the essential thing when doing business, any kind of businesses, without it there will be no success. When you have a wonderful product idea that you want to sell, you have the money to hire smart people for your company but do not have the networks, then everything will not be realized. Network here may include the suppliers where you will purchase the materials to create your product, customer who will buy them, workers who will be directly involved in the production operation and any other people who have potential interest to the business. Networking can be classified into two categories, the first one is self networking (the people in our personal lives like family, friends and other relatives) and the second one is bizz networking (people related to our business activities like employees, customers and suppliers).
The result of knowing more and more people and introducing our business to them may mean more advantageous business opportunity, in a way where we may work together with these people to create a new project or other business activities. The forms of collaboration possible are ownership, joint venture, strategic alliances, partnership and outsourcing. Getting involved in one of these collaboration forms will help the business to grow, however the hardest part is to maintain the connection between you and the other parties. To extract the best elixir out of this potion is by applying trust, power, social norms and commitment and interdependence.
Next to networking is the distribution channel of the products that we sell. The difference between networking and a channel is that the latter has a formal written relationship, agreed by law. Basically, there are direct, semi-indirect and indirect distribution channels. Direct channel means the manufacturer directly sells the product to the end user, the consumer. Semi-indirect and direct method use intermediaries to transport the product to the consumer, the intermediaries can be wholesaler and retailer. These channels can all be adopted by all business forms, whether business to business or business to consumer.
In conclusion, we must not stop making friends and knowing new people because it will benefit both our personal and professional lives. Remember that hundreds of friends are too little but one enemy is too much! This principle should really be applied for everyone who concern about the future of their career since those friends that we have will somehow help us in the success of our businesses.
Networking is the essential thing when doing business, any kind of businesses, without it there will be no success. When you have a wonderful product idea that you want to sell, you have the money to hire smart people for your company but do not have the networks, then everything will not be realized. Network here may include the suppliers where you will purchase the materials to create your product, customer who will buy them, workers who will be directly involved in the production operation and any other people who have potential interest to the business. Networking can be classified into two categories, the first one is self networking (the people in our personal lives like family, friends and other relatives) and the second one is bizz networking (people related to our business activities like employees, customers and suppliers).
The result of knowing more and more people and introducing our business to them may mean more advantageous business opportunity, in a way where we may work together with these people to create a new project or other business activities. The forms of collaboration possible are ownership, joint venture, strategic alliances, partnership and outsourcing. Getting involved in one of these collaboration forms will help the business to grow, however the hardest part is to maintain the connection between you and the other parties. To extract the best elixir out of this potion is by applying trust, power, social norms and commitment and interdependence.
Next to networking is the distribution channel of the products that we sell. The difference between networking and a channel is that the latter has a formal written relationship, agreed by law. Basically, there are direct, semi-indirect and indirect distribution channels. Direct channel means the manufacturer directly sells the product to the end user, the consumer. Semi-indirect and direct method use intermediaries to transport the product to the consumer, the intermediaries can be wholesaler and retailer. These channels can all be adopted by all business forms, whether business to business or business to consumer.
In conclusion, we must not stop making friends and knowing new people because it will benefit both our personal and professional lives. Remember that hundreds of friends are too little but one enemy is too much! This principle should really be applied for everyone who concern about the future of their career since those friends that we have will somehow help us in the success of our businesses.
Monday, April 4, 2011
Entrepreneurial Product, Pricing and Branding
Today we learned that there are three very important thing that we have to consider as an entrepreneur, they are product innovation, pricing and branding.
First is about product, there are actually four levels of product in the market, core, tangible, augmented and communicated. Until what level do you want to bring your product? It really depends on every individual.. Anyway, communicated is the ideal standard that everybody wants to achieve, where the company has a good image in the market and the brand is easily recognized by people. Our product is an innovative snacks, packed in tubes and suitable for events. It means that our product can be categorized into non-durable good, with new product innovation (where new ideas are being generated, new efforts made and new resources needed) in packaging, ease of use and degree of customization. We aimed it into the middle to upper market category and we really want to build a prestigious image and high-class brand for the product. There are still so many areas where we can innovate and upgrade our products into, like reliability and durability. We haven't thought about these before, but in the future, these things will seriously be taken into consideration.
Another very important thing is pricing because it shows the value of the product, it may vary from time to time, it differentiates one product from the other, it is one of the customer's considerations before purchasing and it may change without prior notice. There are several factors that will influence the price of our product like cost of good and demand. Besides, once we set the price of our product, there are still factors that will be influenced by it such as sales volume and sales revenue. That is why setting the right price for one product may be a very hard work to do. I think, since our target market is the middle to upper economy, then we will use skimming pricing strategy and we will give discount when there is a large number of order.
The last thing we discussed today was about branding. I knew that brand is really important for a product, it may add value to the product itself through brand awareness (brand recognition and recall) as well as creating brand image (from the attribute and may give benefits to the company). Why do people buy overpriced leather Louis Vuitton bags? For the prestige that it gives to the people who wear it! Yeah, that's how powerful a brand is, it may help you with your profit margin but u also have to be careful in keeping the prestigious image of the brand. There are also several types of branding like individual, umbrella, sub-branding and co-branding. For the meantime, we will still use individual branding for our project since we don't have too many products too offer yet and it is still a long way to go to build a good image.
Overall, these three factors are really important for a business to go well.. Without a good product offered, then people will not buy it even though the price is competitive and the brand design is cool. The contrary also applies, a good product with a good brand may not survive with irrational price! So, these three factors complete each other in a way or another!
First is about product, there are actually four levels of product in the market, core, tangible, augmented and communicated. Until what level do you want to bring your product? It really depends on every individual.. Anyway, communicated is the ideal standard that everybody wants to achieve, where the company has a good image in the market and the brand is easily recognized by people. Our product is an innovative snacks, packed in tubes and suitable for events. It means that our product can be categorized into non-durable good, with new product innovation (where new ideas are being generated, new efforts made and new resources needed) in packaging, ease of use and degree of customization. We aimed it into the middle to upper market category and we really want to build a prestigious image and high-class brand for the product. There are still so many areas where we can innovate and upgrade our products into, like reliability and durability. We haven't thought about these before, but in the future, these things will seriously be taken into consideration.
Another very important thing is pricing because it shows the value of the product, it may vary from time to time, it differentiates one product from the other, it is one of the customer's considerations before purchasing and it may change without prior notice. There are several factors that will influence the price of our product like cost of good and demand. Besides, once we set the price of our product, there are still factors that will be influenced by it such as sales volume and sales revenue. That is why setting the right price for one product may be a very hard work to do. I think, since our target market is the middle to upper economy, then we will use skimming pricing strategy and we will give discount when there is a large number of order.
The last thing we discussed today was about branding. I knew that brand is really important for a product, it may add value to the product itself through brand awareness (brand recognition and recall) as well as creating brand image (from the attribute and may give benefits to the company). Why do people buy overpriced leather Louis Vuitton bags? For the prestige that it gives to the people who wear it! Yeah, that's how powerful a brand is, it may help you with your profit margin but u also have to be careful in keeping the prestigious image of the brand. There are also several types of branding like individual, umbrella, sub-branding and co-branding. For the meantime, we will still use individual branding for our project since we don't have too many products too offer yet and it is still a long way to go to build a good image.
Overall, these three factors are really important for a business to go well.. Without a good product offered, then people will not buy it even though the price is competitive and the brand design is cool. The contrary also applies, a good product with a good brand may not survive with irrational price! So, these three factors complete each other in a way or another!
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