Value Creation in Buyer-Seller Relationships

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Value Creation in Buyer-Seller Relationships

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Learning Objectives

• Understand the concept of perceived value and its
  importance in relationship selling
• Explain the relationship of the roles of selling
  and marketing within a firm
• Explain why customer loyalty is so critical to
  business success

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Learning Objectives

• Recognize and discuss the value chain
• Identify and give examples for each category of
  communicating value in the sales message
• Understand how to manage customer expectations

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Value is Related to Customer Benefits

• Utility the want-satisfying power of a good or
  service
• Types of Utility
• Form
• Place
• Time
• Ownership

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Increasing the Value to the Customer

• Raise benefits
• Reduce costs
• Raise benefits and reduce costs
• Raise benefits by more than the increase in costs
• Lower benefits by less than the reduction in costs

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Lifetime Value of a Customer

• Lifetime value of a customer present value of
  the stream of future profits expected over a
  customers lifetime of purchases
• Firing a customer encouraging a customer to
  find alternative sources from which to purchase

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Communicating Value in the Sales Message

• Product quality
• Channel deliverables (supply chain)
• Integrated marketing communications (IMC)
• Synergy between sales and marketing

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Communicating Value in the Sales Message

• Execution of marketing mix programs
• Quality of the buyer-seller relationship (trust)
• Service quality
• Salesperson professionalism

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Communicating Value in the Sales Message

• Brand equity
• Corporate image/reputation
• Application of technology
• Price

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Product Quality

• Performance
• Features
• Reliability
• Conformance

• Durability
• Serviceability
• Aesthetics
• Perceived quality

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Integrated Marketing Communications

• Solid IMC allows salespeople to solidify their
  client relationships by referring to a
  well-known, consistent corporate message
• Clients expect and deserve consistency in the way
  a firms value-added message is put forth

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IMC Communicating the Message
Firms employees and other internal stakeholders

• Firms internal value chain

• Customers and other external stakeholders

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Synergy Between Sales and Marketing

• Seamless organizational processes focused on
  managing customer relationships strengthen the
  value proposition
• When sales and marketing are not synergistic, the
  customer is marginalized

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Execution of Marketing Mix Programs

• Product
• Place - for distribution, or getting the product
  into the hands of the customer
• Price
• Promotion - marketing communications

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Quality of the Buyer-Seller Relationship

• The quality of the buyer-seller relationship is
  measured by trust
• Trust - a belief by one party that the other
  party will fulfill its obligations
• Trust is essential to successful relationship
  selling
• Trust signifies that a salesperson has the
  customers long-term interests at heart