exam 3 (15-20) Flashcards
(198 cards)
1
Q
marketing communications
A
- all communcation that informs and persuades buyers idea is to get all promotional mix elements to work tgt
2
Q
promotional strategy
A
plan for optimal use of all elements of promotion to gain a particular response
- convince buyers that company product has a competitive advantage
3
Q
Promotional Mix (PM) 5 elements
A
- advertising (mass communication)
- public relations (unpaid; effective but limited control)
- sale promotions (can have variety of objectives)
- personal selling (expensive; face to face; high impact)
- social media
4
Q
PM 1st element
A
- advertising
any form of impersonal, paid, mass communication
- marketers use this to reach large audiences
- high cost due to mass appeal
- low cost per person
- marketers have complete control over message
- lower credibility (buyers realize this is paid communication
5
Q
PM 2nd element
A
- public relations
communications w customer, suppliers, employees, n community w intent of creting favorable publicity
- not paid communication
- try to get exposure
- media stories are done in their own words but lack of control = buyers trust
6
Q
PM 3rd element
A
- sale promotions
all activities that focus on promoting sales w intent of inducing trial for new products, increasing sales, or getting rid of extra inventory
- except ads + public relation
- short term orientation (coupons, rebates, discounts)
7
Q
PM 4th element
A
- personal selling
in person selling for big purchases or business markets
- effective, esp in bus market
- give opportunity to impress customers w the value of offering n to negotiate deals
- expensive (justified by size of transactions)
8
Q
PM 5th element
A
- social media
shifted controls to consumers
- control info one wish to see
- control content they can share
- info moves at accelerated pace n amplified
- marketers can succeed by facilitating this communication instead of dictating the content
9
Q
3 promotional goals (PG)
A
- informing
- persuading
- reminding
- successful promotion = move consumers through all stages
10
Q
informing
A
- done in early stage of the product life cycle
- occurs when new brands are introduced n market is not aware of what brand has to offer
11
Q
persuading
A
- in late introduction growth n early maturity stages
- marketers shift focus to persuading market to buy products
- may emphasize superiority of product to convince buyers
12
Q
reminding
A
- later stage of life cycle
- goal: remind consumers in creative ways to stay on top of their minds
- all brand have well established images
- market is familiar w what they have to offer
- connect to create ongoing relationship w customers
- hard to achieve, social media makes it easier
13
Q
AIDA concept
A
- Attention
- Interest
- Desire
- Action
14
Q
attention (AIDA)
A
gain attention of market, create awareness
- creative helps draw attention (flood consumer w commercial messages)
15
Q
desire (AIDA)
A
create a message to be convincing enough to create consumer preference for the brand
16
Q
interest (AIDA)
A
create an appealing enough to capture consumer’s interest
17
Q
action
A
communication should have a call to action, prodding consumers to purchase product
18
Q
Factor affecting promotional mix
A
- nature of product
- stages in product life cycle
- types of buying decisions
- push n pull strategies
19
Q
nature of product
(business vs consumer)
(customized vs mass)
A
CONSUMERS products are often MASS produced
- little to no customization
- mass media like ads works well
BUS products are often CUSTOMIZED
- requires fair amount of customization
- must explain customization to buyers
- personal selling is effective
20
Q
stages of product life cycle (PLC)
A
- early stage:
- ads n public relation to build awareness
- sale promotion to induce trial
- personal selling for obtaining distribution - growth stage:
- ads n public relations use to emphasize product’s differential advantage
- sale promo induce trial can be reduced - maturity
- high awareness
- intense competition
- continue persuasive n reminder ads
- sale promo to increase sales - decline
- ads is severely curtailed
- personal efforts continue at retail lvl
21
Q
types of buying decisions
A
- simple decision
- elaborate
22
Q
simple buying decisions
A
routine purchase of low $, no deliberation
- reminder ads (consumer are aware of brands)
- sale promo increase sales
23
Q
elaborate buying decisions
A
- elaborate - no routine, consumer asks for assistance
- personal selling
- same for shopping good
24
Q
push n pull strategies
A
- product flow down the channel from manufacturers -> wholesalers -> retailers
1. push
2. pull
25
PUSH strategies
force product through channel
- done through incentives (ex: trade discounts)
- continue pushing until it reach end consumer
- personal selling n trade + sales promo are used
26
advertising
impersonal, one way mass communication paid for by marketer to increase sales in long run
- ads increase sales
- ads response function looks like elongated S
- increase ads = difficult to gauge when response slow down
27
S shaped curve (advertising)
bottom (5,0): there are little sales even in the absence of ads
flat curve + moving up: increase ads has little affects in sale cuz its unnoticeable before it hits a certain threshold level
middle: relatively high effectiveness
- increase ads = increase sales
- most company operate here
end: towards higher lvl of ads, sale curves flat
28
institutional (corporate) ads
focus on promoting corp as a whole
- for firm that use parent brand name for all products
- use to promote positive image
- use to overcome negative perceptions
29
product ads
focus on individual products
- 3 types
1. pioneer ads
2. competitive ads
3. comparative ads
30
pioneer ads (product)
focus on explaining benefits of new products n not on promoting
- used during early states of PLC
31
competitive ads (product)
focus on convincing customers to buy their own brands by creating valuable attitude toward brand
- product enters growth stage when competitor comes into the market
32
comparative ads (product)
explicitly compare them w competitors brands
- useful for smaller brands
- rare for bigger brands
- illegal in many countries
33
ways to set ad budgets
1. follow % of sales: firm assign fixed % of sales for ads budgets
- cons: downturn = decrease ad budget
2. competitive parity: spending at lvl comparable to competitor
- gives sense of equity to all participants
3. defining ads goals for measured ads result (DAGMAR)
34
4 steps to creating ads
1. identifying product attributes n benefits
2. developing ads appeals
3. executing message
4. post campaign evaluation
35
identifying product attributes n benefits (creating ads)
1. attributes
characteristic of products
- ex: size of car's engine
2. benefits
what customers get out of it
- ex: big engine = thrilling ride
some says benefits > attributes
36
developing ads appeals (creating ads)
refers to what specifically should be stressed
- ex: rollercoaster have fun n thrilling appeals
37
brand's unique selling proposition
- ads appeal that is chosen
- something special about the brand is is emphasized on an ongoing basis
38
executing the message (creating ads)
what would be the best way to convey this message
- creative needs to be strong n effective to be noticed n influence buying behaviors
- messages should move consumers through AIDA stages
- common execution styles: fantasy, humor, demonstration, n testimonials
39
slice-of-life appeals
when advertisers show how product fits consumer's lifestyle / how its used in a normal question
40
post campaign evaluation (creating ads)
evaluating success of campaign
- compares pre n post campaign standing on variable of interest
41
media planning
media decisions in ads must make many choices such as:
- choice of appropriate media.
- media mix
- media schedule
42
media types
- newspapers: cheap + geographic selectivity
- magazines: better reproduction + high pass along rate + longer lives for ads + highly targeted
- television: high cost + higher impacts + engaging n easy to show product + wide coverage
- radio: low cost + highly localized
- outdoor: billboards
- internet: highly customizable options + monitor real time performance
- alternative
43
media mix
combination of different media channels used in an advertising campaign
- no perfect mix
- numerous options
44
determine efficacy of media mix
marketers looks at variety of of criteria
1. cost: cost of reaching each person in the audience
- most make this # readily avaiable to advertisers
- Cost per thousand (CPM) is commonly used
- cost per click: key metric for online media
2. reach: how many ppl does medium has access
- marketers tends to provide # n profile of audiences
- wider mix = less fragmented media mix
3. audience selectivity: ability to reach target market
45
gross rating points (reach)
% of all TV audience at any point of time that is tuned to specific program
46
frequency
refer to # of time individual is exposed to ads
47
continuous media scheduling
considers when to place ads
- same amount of ads can be schedule for diff results
- steady place
48
flighted media schedule
ads are run heavily in short bursts w not ads between bursts
- concentrated brusts help raise communication above noise lvl n get market attentions
49
pulsing media schedule
combination of continuous n flighted
- continuous schedule, at lower amplitude + heavier ads bursts
- use by retaul
50
seasonal media schedule
matches ads to seasonality of sales for certain products
51
public relations (PR)
aims to impact public attitudes n execute programs to gain their understanding n acceptance
- get favorable publicity for firm or product
- achieve by influencing articles n editorials in media
52
public relations functions
1. corporate communication
2. product publicity
3. employee n investor relations
4. lobbying
5. mgmt of crises
53
common tools of public relation (PR)
1. new product publicity
2. product placement
3. consumer education
4. sponsorships
5. internet website n social media
54
new product publicity (PR tools)
new products/innovations make appealing stories for the press
- effective n used extensively
55
product placement (PR tools)
getting brands to appear in tv shows, movie, radio, etc as part of the narrative
- growing industry cuz of digital vids recorder
- when brands are woven into storyline, it will be noticed and won't be zipped/zapped
56
zipping and zapping of commercials
zipping - fast forward to skip ads
zapping - changing channels during ads break
57
consumer education (PR tools)
educating consumers can help increase sales
- offer seminar or workshops to capitalize this
58
sponsorship (PR tools)
create a strong link between brand n nature of event
59
internet website n social media
used increasingly to provide ready access to company news
- get favorable stories to target market
- effective cuz ppl share it
60
sales promotions
intended to indue trial of new products n increase existing product sales
- have Short term orientation
- spillover long term affects
61
consumer promotions
- directed at consumers
4 tools
1. coupons n rebates
2. premiums
3. loyalty programs
4. point-of-purchase promotion
62
coupons
offer through free standing inserts (FSIs) are good way to reduce price for consumer w out permanent price cut
- inducing buyers to purchase right away
63
rebates
offer temporary price cut but need to be mailed in
- half of buyers fails to get rebates cuz they fail to finish paperwork
64
premiums
extra items offered as incentives for purchase of original items
- reward or give buyers new product
65
loyalty programs
induce loyalty by having rewards after purchasing product a multiple # of times
66
point of purchase promotions
the area where a retailer or marketer places promotional
- ex: product sampling n POP
- good product where consumers make up their mind in the store
67
trade promotion
directed towards traders or member of distribution channels
- common tools
1. trade allowance
2. push money (vs pull for ads)
3. training
68
trade allowance
discount given my manufacturer to wholesalers n retailers for doing smth specific that would help the manufacturer
69
push money
useful when emphasizing push strategy
- give push money to intemediatiers to push their product
70
training
train employees especially when its complex
71
personal selling
paid-for, face to face communication aimed at informing n influencing customers to increase sales
72
when to use personal selling
expensive so for:
1. product w high transaction value
- big ticket or large volume
2. product is custom made or complex
3. few customers
- cost effective
4. buyer is the later stages of purchase process
- old selling style use canned approach
- new thinking like marketing concept n buyers relationships
- ideal for large customers???
73
canned approach
pre-designed sales pitch w aim of making sales
74
relationship selling
salesppl work w buyers in consultative role, understanding customers needs, n offer solutions
- saleppl n buyers become partners in solving buyers problem
- long term relationship
75
customer relationship management (CRM)
put customers at the center n manage every contact w them to understand needs n collect relevant info to leverage needs n increase sales
76
CRM 4 steps process
1. identify customer relationship
2. understand interactions w current customers
3. capture customer data
4. leverage customer info
77
CRM 1
identify customer relationship
- companies running successful CRM programs are customer centric
- develop company responses through needs n wants of buyers
- learning: collect good datas on buyers
78
CRM 2
understand interactions w current customers (foundation of CRM)
- identify all situations where buyers can interact w company (personal, online interactions n ads exposure)
- point-of-sale interactions = useful to understand behavior (aka touch point)
- aims to manage interactions at all touch points for + experience
79
CRM 3
capture customer data
- capture all data at all touch points
- rich n available for all buyers = valuable resource
- layout data collection plan from time buyers start interactions n continue to all on going interactions
^ data come from variety of sources n be fragmented
- relies on knowledge mgmt to create centralized database shared by everyone
80
CRM 4
leverage customer info
- one date consolidate, use data mining to identify trends n relationship between diff marketing variables, buyers behavior, n sales
- leverage in various ways
81
CRM data leverage methods
1. campaign mgmt: use interaction data to create effective communication campaigns
- cultivate n retain loyal customer by studying preferences, rewards, n patron
- cross sell other G/S
2. inducing trials of new products
3. detailed understanding of customers: to target communication about G/S
82
7 steps of personal selling
1. general leads or prospecting
2. qualifying leads
3. approaching customers
4. developing n proposing solutions
5. handling objection
6. closing sales n following up
- doesn't have to start from the start each time after that
83
general leads or prospecting
creating list of prospects who may have interest in purchasing products
WAYS:
1. cold calling from list purchased from outside source or tradeshow buyers
2. referrals: recs from buyer or bus associates
3. networking
84
qualifying leads
assessing prospects' needs, buying power, and receptivity toward products
ways:
1. telemarketing
2. cold calling
- sale ppl focus on qualified buyers
85
approaching customers
pre-approach: groundwork saleppl need to cover before approaching buyers
- better job at selling if they understand competition, industry, n product offering
- helpful in consultative setting
86
developing n proposing solutions
after understanding customers's needs, they prepare sales proposals
- impress buyers
87
sale proposals
formal doc that outline how company will deliver n accompanying terms
- written report
- sales presentation
88
handle objection
- follow sale proposal or be part of sales presentation
- shouldn't be seen as negative predispositions
- view as opport. for salesppl to clarify offer
- handle correct by: close or finalize the sales by asking for the next step
89
closing sales n following up
- as questions
- might need additional negotiations
- have proactive effort to close deal
- follow up to ensure products are delivered per term
90
sales mgmt (SM)
refers to managing sales force
5 responsibilities:
1. defining sales goals
2. determining sales force structure
3. recruiting n training sales force
4. compensating n motivating
5. evaluating sale force
91
SM 1
define sale goals
- clear, precise, n measurable of rev n profit margin
- divide goals among member of sale force
92
quota
amount salesppl is expected to sell in given timeframe
93
determining sales force structure
- organize structure of sales force in efficient manner
- organize using geographic (ppl spread out) or product line industries ccustomer belong to (more ppl in certain industry or disparate products ), or size n type of buyers
(large firm combine these)
- structure sale force
94
recruiting n training sales force
- sale performance is clear in short period of time
^ motivates successful sales ppl n demotivates the rest
- result: high turnover at start of careers
- expensive proposition for firm so must make extra effort to select correct ppl for proper training
95
compensating n motivating sales force
- help recruiting n training sales force by looking at ppl backgrounds, accomplishments, n administering series of personality test
- good compensation plan retain successful ppl n motivation ig
- fixed compensation provide financial security and compensation based on commissions
- combine good n fixed giving base salary + additional compensation in commissions tied to performance
96
evaluating sale force
- determines compensations n help diagnose weak areas of performance
1. identify weakness at each step of sale cycles n provide guidance
97
social media (SM)
internet based services to facilitate conversation n social interaction
- hallmark of social media is user generated content
- change from social media's connectivity to hyper-personalization n highly customized experiences
98
marketers communication channels (new v. old)
- marketers n customers change ways of interacting w each other
- old communication model = one-directional: flow from marketers --> customers
- new: info flows in all directions: marketers speak to customers n customers can create/share their own content
- consumers can interact more directly w brands n brands get more info to sort
- content are custom delivered + limited control on how info is collected n used
99
social media + marketers relationship
market is fully vested n has symbiotic relationship w media
- marketers help social media grow
- social media provide marketers w attractive platform to connect
100
crowdsourcing
marketers use audiences' help to create new marketing initiatives n improve existing ones
101
social media revenue source
- advertising
- selling g/s
- sell users' data to marketers
102
user-generated content
pictures n videos that users create n share
103
3 social media communications brands
1. paid
2. owned
3. earned
104
paid media
paying for ads content, special promo, n influencer
- "paying others to carry message"
- similar to paid ads / traditional ads n promotion
- ex: retail store display, billboard, tv commercials,
105
owned media
include brand-controlled source
- ex: website, company publication
- SM ex: company fb/insta page
106
earned media
coverage that is earned through word-of-mouth or online buzz
- raise profile if other talks about them
- ex: yelp reviews, fb/insta comments
107
content marketing
(solution to crowding)
marketers use platforms to distribute content that customers may find valuable
- ex: how to ___
108
social media disadvantages
1. crowding (↑ users) = ↑ noise for consumers
- marketers have to be more sophisticated n cut through clutter
2. cost resources n effort to keep consumers engaged
109
influencer marketing
(solution to crowding)
pay influencers to promote products to their followers
- firm has less control
- consumers find this more credible than paid ads
110
social listening systems (SLS)
system that allow firm to automatically asses what are said about the brand across platforms
111
text mining (SLS)
large quantity of text is automatically analyzed
- provide a sentiment analysis (how +/- ppl w the brand) n share of voice (how brand is mentioned)
- a form of big data analysis
-ex: collections of tweets
112
performance metrics for Social media
1. reach metric
2. engagement
3. acquisition
4. conversion
5. retention
6. SEO n SEM
113
reach metric
measure how many ppl see posts abt brand
- audience = # of ppl within brand's social media across platform
- audience growth rate
114
audience growth rate
measure how many ppl are added/lost over certain period
115
engagement metrics
measure how many ppl interact w posts abt brand
- engagement rate
- amplification rate
116
engagement rate
% of audience that has interacted w brand's content
- like/comment in a certain period
117
amplification rate
avg # of shares per post within specific period
118
acquisition metrics
measure how many ppl visit a link posted within content related to brand
- click-through rate
- bounce rate
119
click-through rate
% of audience click on a post
120
bounce rate
% of visitors who return to source site/platform w out clicking on linked site
121
conversion metrics
measure transition from seeing brand content to purchasing it
- conversion rate
- cost per conversion
122
conversion rate
% of ppl seeing ad who make purchases
123
cost per conversion
total amount spent / # of conversions
124
retention metrics
measure how many ppl will stay loyal to the brand
- churn rate
- brand advocacy rate
125
churn rate
% of audience who leave within certain time
126
brand advocacy rate
% of audience who recommend g/s to others
127
search engine optimization (SEO)
process of trying to get higher rankings in search engine so the brand appear first when customer search
- done by:
1. ensure webpages are up to date w SE standards
2. current n relevant content
3. linking it to other prominent sites
128
search engine marketing (SEM)
practice of paying SE to display ads for brand toward top of a search
- use google adwords
129
privacy (SM concerns)
using data w out knowledge/consent of users
130
privacy paradox
when users say they are concern abt their privacy but do little to protect it
131
undisclosed ads (SM concerns)
ads made to appear like content (native ads) where influencers doesn't disclose that they're being paid to promote a g/s
- deceptive, can be illegal
132
micro-targeting (SM concerns)
use SM to send ads to highly focused groups of ppl
-using psychological profiles to entice customers
- raises transparency concerns
- ex: specific ads for diff users
- use user's identities to target
133
algorithmically driven content (SM concerns)
specific contents for users based on their media behaviors, interest, n interaction
- use behavioral psychology
- keep users on a feed/search for longer than they intended
134
mental health (SM concerns)
SM negatively impact mental health
- create high social comparison
- idealized personas
- fear of missing out
- cyberbullying
- marketers should mitigate through ethical conduct n conscientious strategies
135
change in pricing impacts
- change in $ have direct impact on firm's top line, sales, n bottom line profit
136
price
amount given up in an exchange to acquire g/s
- sacrifice affect
- reward affect
- different between the 2 is perceived value (tied w buyers satisfaction w purchase
137
sacrifice affects
amount buyers pay for smth
138
reward affects
what buy gets in return
- big rewards at low price = gratifying
139
revenue (sales)
product of price per unit n # of units sold
140
profit
difference between rev n costs
141
costs
1. variable costs:
- cost per unit remains the same
- total variable varies w output
2. fixed costs
- fixed cost per unit varies w output ( ↑ output = ↓
- total fixed are fixed
- serve as a floor for pricing
- amount of cost = lowest price a firm is willing to charge
142
marginal costs
cost of producing an additional unit
143
marginal rev
rev created from an sale of an additional unit
144
contribution margin
price - var cost
145
profit oriented pricing
focus on amount of profit firm can make
146
profit maximization
setting price so profits r max
- do so by increasing rev or decreasing costs
- where diff between rev n cost is the highest
147
break-even pricing
focuses on break-even (point where no profits or losses are made)
148
target return on investment
focuses on creating enough profits to justify ROI
149
markup pricing
take costs n adds a markup on that as profit
- use by wholesalers/retailers`
150
sale oriented pricing
focuses on maximizing sales or market shares
- set price that will give largest sales n market share in the long run
- 2 benefits
1. claim leadership status in market
2. cost competitiveness where greater eco of scale give firm ability to undercut n squeeze out competitors
151
status quo pricing
seeks to maintain balance w competitors' pricing
- easy to execute
- follows pricing set by market leaders
152
valued based pricing
when price correspond to what consumers perceive as fair value of product
- survey customers
153
pure competition
markets w infinite buyers n sellers and ready availability of substitutes cuz products r not differentiated
154
demand curve
↑ P ↓ D
155
supply curve
↑ product P ↑ supply output
156
elasticity of demand
measured by change in demand for a unit change in P
- buyers sensitivity to price
157
high price elasticity
change in P drastically alter D
158
inelasticity
change in P doesn't change D by a lot
159
unitary elasticity
↑ P is compensated by ↓ in D where product of P n D remains the same
- marketers like to have control over pricing
160
Factors that ↓ elasticity
1. lack of easy availability of substitutes ↓ E (buyers dont have cant switch products)
2. price-relative to purchasing power ↓ E (if P is small compared to purchasing power)
3. ease of evaluating quality ↑ ↓ E (difficult to evaluate product quality = can't judge how competitor product compare)
4. prestige pricing (high price signal high quality)
161
pure monopoly (market structure)
1 seller + no competitions so can change P
- illegal
- exception: regulated monopoly (P somewhat controlled)
162
pure competition (market structure)
infinite buyers n sellers + no product diff
- market determine P (using equil)
- seller no control over P, cannot charge more than Equil
163
oligopoly (market structure)
few sellers, selling relatively undifferentiated products
- P product at going rate
- higher price will make customers switch
- lowering price = other competitor lowering their P = price war
164
duopoly
special case of oligopoly where there's only 2 sellers
165
monopolistic competition (market structure)
sell highly differentiated products n charge prices that can be justified on basis of differentiation
- extreme control over P
166
skimming pricing
suitable for durables
- firm start w high P, lowered when a certain # of buyers buys the product
167
skimming price advantages
1. gets everyone to pay max price they are wiling to pay or they wait for P to lower
2. no product shortages so P are used to control demand
3. durable - no repurchase in short run so good to change high price
168
penetration pricing
suitable for repeat purchase items (frequently purchased non-durable products
- get repurchases, sellers needs to induce trial or 1st purchase of product
- done by lowering initial price to get buyers to buy product (penetrating market)
169
discounting
temporary modify price w out perm changes to base P
- use to sell excess inv, introduce new products, appeals to wider market
- done during off-peak hrs, reduced rate for groups (students, senior, military)
170
quantity discounts
discount buyers receive when buying multiple units
171
cash discounts
discount if buyer pays w cash
- encourage prompt payments
- used for business customers
172
seasonal discount
reduction in price during off seasons
173
promotional or trade allowances
payment made to channel members for performing certain actions
- pushing products, increase shelf space, offering prominent display
174
rebates
cash refund for purchasing product during specified period
- mail in rebate form
175
free on board (FOB) pricing
buyers pay the freight charges
- price is the same at the origin
- varies for all customers depending on how far they r from the origin
- used when freight cost component is high
176
uniformed deliver price
everyone pays the same shipping price
177
zone pricing
customers within a zone pays the same final price than paid by customers in other zones
178
loss leader pricing
price are priced so low that it incur a loss
- advertised in hope of higher traffic store
- most used by retailers
- compensated for when other items are brought
179
psychological pricing
set price in way that influence customer's perception
- ex: 7.99 instead of 8
179
two part pricing
setting relatively low base price for the 1st product and higher P on subsequent options or other needed parts
180
price bundling
bundle products priced lower than combined prices of individual items
- locks customers to buy products from the same firm
181
versioning
multiple version of same product w added items
- cater to ppl w different needs
182
price fixing (illegal pricing)
competitor collaborate to fix a price and avoid price-base competition
- illegal under anti trust law
183
price discrimination (illegal pricing)
charging diff price to diff buyers in short span of time for same g/s
- protect smaller buyers from being overcharged
184
predatory pricing (illegal pricing)
undercutting competitors prices w intent on driving them out of business
185
marketing metrics
measure bus performance from marketing perspective
- reduce brand's performance uncertainties
186
key performance indicators (KPIs)
the metrics that are central to bus
- displayed in dashboard for managers to check
187
unit margins / markup
measure the difference between selling price n cost
188
break event point
level of sales where total rev = total cost
189
break even analysis
useful for determining the feasibility of a given pricing strategy
190
customer lifetime value (CLV)
measures how much profit firm expects to make from single customer throughout duration of relationship
191
CLV adjusted for 2 things
1. retention rate
2. discount rate
192
retention rate
% of customers retained over period of time
193
discount rate
future cash flows r discounted to calculate present value of all future cash flows
194
CLV benefits
1. determine feasibility of any marketing, promotion, n pricing strategy
2. determine value of build relationships w particular customers
195
measuring customer sentiment
measure customers opinion n behaviors
- give a sense of how brand is performing n how it can be improved in the future
196
measuring metrics
can be measure if we create a measure that is sensitive to the range of that dimension
197
