Marketing Management Short question and Answer Set 5
Question No. 25 Write any special characteristics of contractual V.M.S.
A contractual V.M.S consists of independent firms at different levels of production and distribution integrating their programs on a contractual basis to obtain more economies or sales impact than they could achieve alone.
Question No. 26 What do you understand by customer equity?
The aim of Customer Relationship Management (C R M) is to produce high customer equity Customer equity is the total of the discounted lifetime values of all of the firm’s customers. Clearly the more loyal the customers, the higher the customer equity. The drivers of customer equity are: value equity, brand equity and relationship equity.
Question No. 27 Write a short note on value equity
Value equity is the customer’s objective assessment of the utility of an offering based on perceptions of its benefits relative to its costs. The subdrivers of value equity are quality, price and convenience.
Each industry has to define the specific factors underlying each subdriver in order to find programs to improve value equity. Value equity makes the biggest contribution to customer equity when products are differentiated and when they are more complex and need to be evaluated. Value equity especially drives customer equity in business markets.
Question No. 28 What is brand equity in customer relation management?
Brand equity is the customer’s subjective and intangible assessment of the brand. The subdrivers of brand equity are customer brand awareness, customer attitude toward the brand and customer perception of brand ethics. Companies use advertising, public relation and other communication tools to affect these subdrivers.
Question No. 29 Briefly describe the significance of relationship equity in customer relation management.
Relationship equity is the customer’s tendency to stick with the brand, above and beyond objective and subjective assessments of its worth. Subdrivers of relationship equity include loyalty programs, special recognition and treatment programs, community building programs and knowledge-building programs. Relationship equity is especially important where personal relationships count for a lot and where customers tend to continue with suppliers out of habit or inertia.
Question No. 30 What is meant by E-business?
E-business describes the use of electronic means and platform to conduct a company’s business. The advent of the internet has greatly increased the ability of companies to conduct their business faster, more accurately, over a wider range of time and space, at reduced cost and with the ability to customize and personalize customer offerings.
Countless companies have set up web sites to inform and promote their products and services. They have created intranets to facilitate employees communicating with one another and to facilitate downloading and uploading information to and from the company’s computers. Companies have also set up extranets with major suppliers and distributors to facilitate information exchange, orders, transactions and payments.