Modern Marketing Concepts

What Is Customer Lifetime Value (CLV)?

While some companies aim to grow their customer base, the successful ones recognize the importance of increasing customer lifetime value. Loyal customers offer more value to your business‐generating over 10x more revenue. Customer lifetime value is an important concept to understand from a marketing standpoint.  The cost of obtaining a customer and gaining that first sale is often much higher than the costs of maintaining the relationship with the customer.

Customer lifetime value (CLV) is a critical metric used to estimate the value of each customer you acquire. It validates whether you’re actually producing a profit. Several companies strive to increase customer lifetime value because they believe it’s a good indicator of business performance.… Read the rest

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Customer Value Analysis (CVA)

Whatever product a marketer has to offer in the market, one thing is sure, it’s going to get competition. It depends on the product type and marketplace what degree of competition it’ll get. In highly competitive marketplace, managing the non-price purchase and satisfaction drivers that matter most to customers can positively impact market share. Customers make purchase decisions based on how valuable they perceive the quality of available products or services as they relate to price. Those organization’s that are perceived to offer low value are highly unlikely to attract new customers and retain their existing customers. In a highly competitive market, an organization’s competitive position is determined by the perceived value of its products and services, relative to the competition.… Read the rest

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Co-Creation of Value in Marketing

Back in 1953, Neil Borden introduced the concept of Marketing Mix. In 1960, it was classified into 4Ps – product; price; place; and promotion – in 1960 by Professor McCarthy. Product can be either physical or service; Price is dependent on its value; Place refers to distribution of; and Promotion refers to communication related to marketing of the product.

The concept of ‘4Ps’ was mainly used in the past when physical product was dominant in the market. There are two main limitations of the marketing mix – common in all examined domains: (i) a model’s internal orientation; and (ii) lack of personalization.… Read the rest

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Concepts of Luxury and Masstige

The word ‘luxury’ derives from the Latin word ‘luxus’ , which according to the Latin Oxford dictionary signifies ‘soft or extravagant living, indulgence’ and ‘sumptuousness, luxuriousness, opulence’ .

There are two aspects to consider when defining luxury, the psychological value and the value of the product/service itself. The psychological value of luxury comes from its function as a status symbol and from a highly involved consumption experience that is strongly congruent to a person’s self-concept. From a product perspective, luxury brands are frequently defined in terms of their excellent quality, high transaction value, distinctiveness, exclusivity and craftsmanship.

In his paper on International Retail Marketing, T.B.… Read the rest

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Co-Branding – Meaning, Strategies and Benefits

Nowadays, one of the highly valued assets for a company are its brands, with branding being every company’s top priority. But it often costs the companies huge amount of money and takes them a long time to build their brand. Today’s market is suffering from a syndrome of sameness where all the products offered to the customers look very similar both in terms of sameness in the physical brand element and in the symbolic value proposition offered to the market. Thus it has become difficult to establish a unique position for new products with markets cluttered with competing brands. Even innovative differentiated products can be imitated quickly, leaving no strategic edge.… Read the rest

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Ethical Issues in Marketing

Ethics are defined as the set of principles that guide a person’s conduct towards being morally right. When a person is faced with some moral dilemma, the choice that the person makes largely depends upon the values and ethical principles that person holds. It is over and above just being legal. Due to being dependent upon the personal values and principles a person holds, an ethical code of conduct cannot be described in absolute terms. Like in all the disciplines of life, recognizing and quantifying what is ethical in marketing and what is not is difficult. In a broader sense, ethics in marketing mean implementing standards of moral rights and wrongs and of fairness in the marketing practices of an organization.… Read the rest

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