Marketing Accountability and Strategic Marketing Process

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Faculty Member: Prof.DR.Ignas G.Sidik
Student : Anton Latief
ID : MME 153082025
Class Summary

Topic 1



Business that have a strong market orientation are constantly in tune with customer’s needs, competitors’ strategies, changes in the business climate, and emerging technologies, and they seek ways to continuously improve the solutions they bring to target customers. This process enables them to move with, and often lead, change.

The major benefit of a strong customer focus is long-run survival. Business with a strong customer focus not only outperforms their competition over the long term by consistently delivering higher levels of customer satisfaction, but they also realize higher profits in the short run. A customer-focused business creates greater customer value and manages customer loyalty as a way to create greater shareholder value.

Little or no customer focus translates into an unfocussed value proposition and minimal customer satisfaction. The result is a low level of customer loyalty because customers are easily attracted to competitors. Marketing efforts designed to restrain customer switching are expensive, as are efforts to acquire new customers to replace lost customers. Low levels of customer loyalty and higher marketing costs contribute to disappointing profits. In response, short term sales tactics and accounting maneuvers are used to bolster short run financial results. But investors are able to see through these facades, and shareholder value generally stagnates. Perhaps worse, managers are now under even greater pressure to produce short run profits, diminishing their time and motivation to understand customer needs and unravel competitors’ strategies.

A business with strong customer focus stays in close contact with customers in an effort to deliver a high level of customer satisfaction and build customer loyalty. Marketing strategies in these businesses are centered on customer needs and other sources of customer satisfaction. The strength also depends on how well it understands key competitors and evolving competitive forces. This aspect enables business to tract its relative competitiveness in pricing, product quality, product availability, service quality, and customer satisfaction.

A strong customer focus and higher levels of customer satisfaction lead primarily to a high level of customer loyalty.

A market based business uses a variety of marketing performance metrics to measure its performance and progress, and one essential performance metric is customer satisfaction. Business that completely satisfies customers is the business that will keep them. One ways to measure customer satisfaction is to compute a customer satisfaction index (CSI) based on customers’ ratings of their overall satisfaction.

Management’s immediate concern should be the customers having a vary degree of dissatisfaction, who are the candidates for exit as customers.

The reason customer satisfaction is a valuable marketing performance metric is its ability to forecast future revenues and profits.

Customer satisfaction is a forward looking indicator of business success that measures how well customers will respond to the company in the future. Other measures of market performance, such as sales and market shares, are backward-looking measures of success. They tell how well the firm has done in the past, but not how well it will do in the future.

A “very satisfied” customers not only buy more, but they also buy higher margin products and services. Dissatisfied customers buy in smaller amounts and often buy low margin or promotional products. After considering the cost of marketing, these customers lose the company money. However, despite their less significant role in profitability, a market-based...
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