New Marketing and the sources of the competitive advantage

How customer-centric orientation and IT remodel the basis of competition.

http://christophe.benavent.free.fr Professor University of Science and Technologies of Lille.

The basic hypothesis

Differentiation through products, services, and brands, to create a preference, maintain high price and win the choice game Insulating the customer from influence of competitors through a process of domestication where the choice is abolished

The two dimensions of customer management

Importance of discrimination Management of diversity Customer Strategy

Importance of changing behavior relationship Management

Integrative framework
The customer management model
Acquisition (transaction) Development (experience)

Retention (relationship)

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Concept synthesis
Transactional Marketing goals Performance criterion Key concepts Preference Market share Choice probability Attitude Product satisfaction Relationship Marketing Loyalty Retention rate Life time Trust Commitment Switching cost Experiential Marketing Value Level of consumption Emotion Consumption externalities

Marketing concept
Context : Goal :
Package goods in a mass-market environment where communication and distribution is mediated by massorganization. obtain a strong preference for the brand and win the choice game.

Means :

a favorable attitude and product satisfaction obtained through a good product design, an acceptable price, brand communication and trade-marketing

Improvements :

Brand equity, ECR, Product Value, and the marketing orientation

Relationship marketing
Context : Goal :
Services and BtoB products distributed through a controlled of direct channel where repeated transactions are embedded in a complex interaction system. Locking-in the consumer and inhibit its choice process, customer retention.

Means :

Building switching cost, developing commitment and trust, personalizing interface and products.

Improvements :

CRM, Data Based marketing, MassCustomization, Interactive Marketing

The Experiential Marketing

Entertainment and information markets where the value of goods depends on different kind of externalities : network, consumption, standards.

Context :

alliances and product bundles, time-pacing consumption .

Goal : Increase the value and level of consumption. Means : Emotional control, education, cross-selling, brand Improvements :
emerging not well established as the concept is

Autonomy and independence :

The New Consumer (1)

Des-institutionalization of relationship and authority (strong link). Growing importance of communities (weak link). More references group. toward a connected society.

Experience, information and knowledge

Finer evaluation of needs. A broader scope of choice and creative solutions. More sophisticated response to insatisfaction equity, responsibility become essential.

The New Consumer (2)

A Replete Consumer :
Toward higher order needs Incitation for variety search A more risk adverse consumer

shift from needs to values. The imperative of re-socialization and recharming social-life

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The I.T. implications

The consumer side :
Giving a transactional advantage (Differenciation) Reinforcing relationship (Personnalization) Developing the experience (Sense meaning, valuation)

The company side

Reducing transaction costs and increasing scope economies (Economy) Increasing the control of customers (Domestication) Building a new community (Socialization)

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Giving a transactional advantage

Purposes : influencing preference and choice. Means :
Personnalization More soft benefits (training, information)

Examples :
A service/solution-oriented approach of that give more benefit to the patient and the practitioner (Faq, website.).

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Reinforcing the relationship

Locking the customer through high switching-cost or high level of commitment

Purposes : Means :

Build interactive communication channels. Developing practices community.

Examples :
Website designed to follow-up the patients by the practitioner.

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Developing the Experience

experience.

Purposes : Means :

Developing more value from

E-Training and information

Example :
A e-training program designed for GP, specialist. Research program with an involvement of some patients and GP.

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Reducing transaction costs

Purposes : Means :
increasing the commercial productivity.

Order on-line (where possible) Micro-marketing project

Example :
Wide use of datamining to target pharmacies and GP Direct marketing program designed for heterogeneous targets.

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Increasing control
Purposes : Means :
A tightened cost analysis system Tracking systems Quality of life monitoring Improving the capability to react to change at the patient, GP, Pharmacy level.

Example : Faradis +

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Building new communities

Purposes: Means :
Changing the role of sale force : not only promoting or informing but being real go-between organize the stakeholder in one broad and interactive community around the brand.

Example :
Creating a new role : e-moderator

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A dynamic ressources approach

Sources of competitive advantages comes from
Capability Capability Capability value. Capability to discriminate. to converse with the customer. to give them meanings and to organize them in community.

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The Ressource Value Based Model

Customer portfolio specificity and value Fine-tuning learning processes Organizational fit Marketing competencies as a competitive advantage and learning processes.
Rare Valuable Inimitable Non substituable

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