| In a world economy that is in constant flux | | | | customers as individuals rather a homogeneous |
| and undergoing turbulence, more companies are | | | | mass of similar tastes, values and buying |
| realizing that their most precious asset is | | | | behaviors. Due to such transformation, |
| their customer base. An even more important | | | | companies need to be more customer-focused in |
| realization is the need to satisfy the whims | | | | its overall marketing strategy. This has |
| and fancies of these customers in order to | | | | resulted in organizations adopting a |
| survive in these increasingly competitive | | | | customization strategy to increase customer's |
| markets. Organizations that do not act on | | | | loyalty to their products and services. For |
| this dictum have suffered the loss of market | | | | example, in banking and insurance industry, |
| share or worse, total annihilation. Such dire | | | | there has been a move towards greater |
| consequences have awakened many organizations | | | | customization. Standard products/services |
| to rethink the way they see marketing. Thus, | | | | have been given way to a varied menu of |
| there is urgency for an organization (be it | | | | features from which customers may select |
| products or service providers) as a whole to | | | | their own preferred combination.In view of |
| develop appropriate holistic customer-focused | | | | these changes, companies that understand the |
| strategies to ensure that the customer | | | | asset value of each customer, and that tailor |
| remains at the core of their organizational | | | | their marketing efforts (and their costs) to |
| thinking.With the rapid advancement of | | | | acquire and sustain the highest-value assets, |
| information technology (especially the rise | | | | will win over less-adaptable traditional |
| of the Web) and the increasing difficulties | | | | marketing approach of the 4 Ps.The Process of |
| of meeting customer's needs and wants (for | | | | Transition:In order to strategically change |
| example, their expectations of 24 / 7 | | | | from a traditional marketing approach to |
| customer service especially for online | | | | customer targeted marketing, an organization |
| transactions), there is a shift from a | | | | must be aware of these following |
| traditional marketing approach to customer | | | | areas:Paradigm Shift. A company must fully |
| targeted marketing. Many organizations and | | | | understand that customer targeted marketing |
| marketing consultants are emphasizing the | | | | requires a shift in the organizational |
| need to allocate more funds to apply | | | | mindset, and not just structural |
| new-found knowledge of consumer behavior in | | | | organizational changes. They must realize |
| new products development, build better | | | | that their sole purpose is to continuously |
| customer relationships through customer | | | | satisfy customers' needs and wants. Thus, to |
| loyalty and retention programs.This purpose | | | | ensure a smooth transition from a traditional |
| of this paper is to raise the awareness of | | | | marketing approach to customer targeted |
| the need to concentrate marketing efforts | | | | approach, an organization must reflect and |
| towards the customer rather than the | | | | ask itself questions as to what areas need to |
| inward-looking traditional product-focused | | | | be analyzed and to understand the |
| arrangement. And more importantly, the paper | | | | ramifications of such a transition in the |
| will shed light on how an organization could | | | | organization. On the other hand, an |
| go about in making this important transition | | | | organization needs to realize the negative |
| in this current competitive market.Marketing | | | | consequences for not willing to be a more |
| Approaches Explained:Before I proceed to | | | | customer-focused marketing |
| discuss the shift in the marketing approach, | | | | organization.Customer Targeted Planning. As |
| it will be appropriate to explain briefly the | | | | in any organizational change initiative, |
| two marketing approaches separately for | | | | proper planning is needed. The objective of |
| greater clarity.Traditional Marketing-The 4 | | | | planning customer-centric marketing |
| Ps of Marketing:The marketing mix or what is | | | | strategies is to find win-win opportunities |
| commonly known as the 4 Ps is a framework for | | | | with customer and to identify the best mutual |
| marketers to implement a marketing concept. | | | | opportunities for your customers and your |
| It consists of a set of major decision areas | | | | company. This requires the organization to |
| that a company needs to manage in order to at | | | | see the issue(s) from the customers' |
| least satisfy consumer needs. According to | | | | perspectives and to strategically plan the |
| Kotler et al. (1999), the mix is a set of | | | | organization's resources around them.In |
| "controllable tactical marketing tools [...] | | | | short, the organization's shift to |
| that the firm blends to produce the response | | | | customer-targeted marketing should embrace |
| it wants in the target market" (p.8). Hence, | | | | these three important points:1.Planning |
| in an effective marketing program, all of | | | | should focus on customer wants and not |
| those elements are "mixed" to successfully | | | | looking inwardly at company goals2.Focus on |
| achieve the company's marketing | | | | the honest feedback and suggestions through |
| objectives.The traditional marketing mix | | | | creating different channels of |
| contains four major elements, the "4 Ps of | | | | communications. Listen to the customers, |
| marketing". As defined by Kotler et al. | | | | rather than forcing them to listen to |
| (1999):1.Product: Anything that can be | | | | you.3.Integrate your customers in every |
| offered to a market for attention, | | | | aspects of your business, from new product |
| acquisition, use or consumption that might | | | | design to after-sales services and |
| satisfy a want or need. In includes physical | | | | more.Organization-wide Responsibility. For |
| objects, services, persons, places, | | | | the approach to be successful, members need |
| organizations and ideas.2.Price: The amount | | | | to understand the new philosophy of marketing |
| of money charged for a product or service, or | | | | and embrace it organization-wide. Many |
| the sum of the values that consumers exchange | | | | organizations tend to underestimate the |
| for the benefits of having or using the | | | | degree to which every facet of the enterprise |
| product or service.3.Promotion: Activities | | | | needs to be involved in the process and to be |
| that communicate the product or service and | | | | integrated into the actual customer |
| its merits to target customers with a view to | | | | relationship.Organization Redesign. An |
| persuading them to buy.4.Place: All the | | | | organization has to assess the roles of all |
| company's activities that make the product or | | | | functional departments interacting with |
| service available to target customers.With | | | | customers to ensure that they add value to |
| the rapid changes surrounding organizations, | | | | customers instead of increasing the costs. By |
| the traditional marketing mix of the 4 Ps has | | | | reorganizing the company with the customer as |
| been criticized for being too myopic in this | | | | the focus, many departmental roles and |
| current market situation. The traditional | | | | responsibilities will have to be redesigned. |
| marketing mix has also been disparaged for | | | | And when that happens, the employees will |
| being too product-focused and for taking an | | | | have to adopt new work processes that would |
| overly inward-looking strategy with regards | | | | be more customer-centric in nature.Human |
| to the organization's resources and | | | | Resource Training. There is a need to develop |
| capabilities in production matters. This is | | | | customer-focused human resource through |
| antithetical to attending to the more | | | | customer behavior training, across the |
| important organizational goal of satisfying | | | | functional departments. By investing in such |
| the desired needs and wants of customers.In | | | | training at all levels, the members will be |
| addition, the Web and E-commerce revolution | | | | more knowledgeable, more autonomous, and more |
| has played a major role in alleviating | | | | efficient in anticipating and meeting the |
| customers' ability to shape their | | | | needs of the customers.Use of Information |
| relationships with the company. This has led | | | | Technology. With the advancement and |
| customers to expect companies to market their | | | | increased affordability in information |
| products and services in ways that reflect | | | | technology, more companies are able to |
| more directly their individual needs.These | | | | collect available data on customer purchase |
| changes have prompted enterprises that wish | | | | behavior more efficiently. For example, |
| to stay ahead of their competitors to shift | | | | technologies ranging from checkout scanning |
| their traditional marketing approach to | | | | to Internet cookies are commonly used to |
| customer-targeted marketing.Customer Targeted | | | | track customers' buying behaviors. Companies |
| Marketing:In customer targeted marketing, the | | | | that employ such technology will be more |
| customer becomes the central focus of the | | | | adept at acquiring new customers, retaining |
| organization's strategy and activities, | | | | existing customers, and cross selling than |
| rather than the product itself (which is the | | | | those who do not.Enhanced Customers |
| prime concern in traditional marketing). The | | | | Communications. With the use of the Internet |
| organization's paradigm shift in marketing | | | | as a medium for targeted communication, this |
| requires a company to build a commitment to | | | | allows companies to be in touch with |
| quality and to listen critically to the | | | | customers at less than one-hundredth of the |
| customer to determine the market needs and | | | | cost of more traditional snail mail, |
| how the company can meet those needs more | | | | brochures or flyers. Communication through |
| effectively.One of the major characteristics | | | | emails with the customers is almost free, and |
| of the approach is to focus on each | | | | the customers can retrieve communications |
| customer's interests and interactions with | | | | almost immediately. However, this has also |
| the organization to deliver targeted, | | | | resulted in customers having 24 / 7 service |
| personal messages. This would require the | | | | expectations of these companies.Customer |
| company to be constantly gathering | | | | Targeted Measurement. An organization must be |
| information about their customers in an | | | | able to measure and evaluate the success of |
| effort to better serve them and, most | | | | their customer targeted marketing strategy. |
| importantly, to retain them as loyal | | | | In most cases, traditional measurement |
| customers. As suggested by Peppers and Rogers | | | | techniques such as profitability, market |
| (1998), the organization would need to use | | | | share and profit margins are used to measure |
| various techniques and strategies (possibly | | | | the success. There should be an added |
| with the help of information technology and | | | | emphasis given to developing measures that |
| the Web), such as focus groups, in-depth | | | | are customer-centric and which are able to |
| interviews, customer surveys, attitude | | | | assess the marketing strategy. Customer |
| testing and so on to obtain information about | | | | acquisition costs, conversion rates, |
| consumers for more effective marketing of a | | | | retention rates, customer sales rates, |
| product or service. With these customers' | | | | loyalty measures and customer share within a |
| data and feedback, the organization will | | | | brand are some examples of customer-centric |
| apply the knowledge to develop more | | | | measures than a customer-focused organization |
| customer-centric products and services and/ | | | | can adoptConclusion:The need for survival has |
| or to improve existing ones. In addition, the | | | | provoked many organizations to shift from |
| information will be shared within the | | | | traditional to customer targeted marketing. |
| organization to encourage employees at all | | | | The market conditions surrounding us will |
| levels to focus on creating maximized | | | | continue to change at an accelerating rate |
| customer value and loyalty.Why | | | | and customer's expectation will continue to |
| Customer-Targeted Marketing?:In order to have | | | | rise. Hence, without any doubts, more and |
| a competitive edge and to satisfy increasing | | | | more companies will adopt a customer-targeted |
| levels of customers' desires, companies | | | | marketing strategy with increased intensity. |
| realized that they have to see their | | | | |