Chapter 9 - Business-to-Business Marketing Lecture 5b...

Info iconThis preview shows pages 1–6. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Business-to-Business Marketing Lecture 5b Relationship portfolio management Principles of portfolio management Companies rely upon a range of customers , each bringing its own type of value Marketers borrow from financial management the idea of balanced investments that mature at different times, producing a steady stream of returns over the long-run Portfolio management involves all decisions to maintain a well- balanced portfolio of customers , that ensures that a company earns value over the long-run by harvesting excess profit and invest them in future offerings A key for business success is the integrated management of the whole portfolio of relationships (i.e. customers) of a firm Lecture 5b: Relationship portfolio management Option Build Actions Build a relationship further for growth, investing where necessary to achieve this growth. Maintain Maintain the current levels of management effort in a relationship in order to collect the benefits from the relationship now through large volumes , high profits or a greater share of the customers purchases. Harvest Harvest the value in the relationship by taking the current monetary value it brings while at the same time beginning to reduce the cost of servicing the relationship over time. Reduce Reduce in the immediate future the level of management commitment to a relationship because the returns are diminishing with little prospect of reversal . Table 9.1. Typical strategic options for a relationship Lecture 5b: Relationship portfolio management Strategic option of a relationship should be chosen in an integrated way , since relationships are inter-related Classification of relationships in categories is necessary for understanding of strategic options Iterative process of breaking down the customer base into smaller clusters (groups of customers per relationship type), similarly to customer segmentation Different classification criteria apply, as in market segmentation Very realistic to have a varying number of relationship (customer) clusters that in their interior require similar managerial approach Lecture 5b: Relationship portfolio management Relationship classification process Early classification by Jackson (1985), that identified the two ends in a relationship continuum : Always-a-share customers (transactional ) driven by price make decisions about supply on the basis of the best deals...
View Full Document

Page1 / 22

Chapter 9 - Business-to-Business Marketing Lecture 5b...

This preview shows document pages 1 - 6. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online