Customer Service and Marketing at MM

MM possesses a agonistical position in this segment in terms of quality intersection point offering and close client relationships shaped tall level Of node support. 2. With intensive amendments in power-to-size ratios and customer service, we saw potential to regain and grow our commercialize share in section A and anchor them as our main business organisation. Initially, we contemplated pursuing sales from particle D and small customers. However, fragment Ads main concern turned surface to be solely on price. To maintain them, as tombstone customers, we would admit to reduce list price substantially.This would retain us from maximizing gross and profit from other segments. As for small customers, we recognized an issue of line of business inflict as these customers purchased through with(predicate) the distributor channel. We learnt through the simulation that distributors would go away their profit margins freely, and could at dates sell the motors lower than our prices to over heavy(p) customers. Hence, to void this conflict, we decided non to focus on small customers. Further more(prenominal), we also learnt that we could have low foodstuff share and decreasing profit margins if we tried to bespeak more than 2 customer segments.So therefore, we decided not to pursue section D and small customers. How does customer rejoicing change all over time? How do you equipoise hard reference metrics such as revenues and profits with soft metrics such as customer felicity? The segment of the motor industry in which MM operated was highly competitive, with over 1 00 participants. Over 70% of Ms revenues were generated from customers that placed large-volume orders. The relationship between MM and its customers was a close one, involving a unceasing dialogue between galore(postnominal) participants.The quality of these relationships and the benefits gained by both sides were critically important to MM. However, customer interviews sugg ested that large customers were tarring to be dissatisfied with the quality of Ms sales team. We chose to allocate 90% of our sales force to the large customers since nearly all our sales volume were attributed to them whereas alone 10% was allocated to small customers to propose space for our distributors to implement their own merchandising and sales efforts.As we progressed, the volume we received from small customers dropped while that for large customers join ond, in line with Ms commercializeing positioning. Hence, we further ontogenesisd the simile of sales resources for large customers to 98%, and also pumped in more ending on sales support for them. Since Segment A was our primary target segment, we allocated the largest proportion of our large customer sales support hours, I. E. 41 %, to them. Segment D, our auxiliary target segment was given 40%.We also gave 10% to Segment B, because we deemed that while Segment B continued to buy from MM, we should try to improve their satisfaction level, so as to avoid negative word of embouchure in the market. The least attention, 1 0%, was given to Segment C, since they responded more to prices than sales support. The quality of sales representative interaction with Segment A was extremely high due to the large number of hours spent on them. The interaction with Segments B and C were good whereas the interaction with Segment D was fair.We managed to make Segments A and C rattling satisfied and Segment D satisfied at the end of the Simi lotion. Segment D did not designate higher satisfaction due to the higher price compared to their expectations. Segment B remained dissatisfied, due to the lower caloric vindication offered by Our product. tending(p) Ms market share and revenue challenges, our team determined the short- and long-term equines goals for MM as follows 1 . Short-term goal Acquire high market share in primary market segments. 2. Long-term goals Attain consistently high profit margins and maintain market share.To achieve these objectives with a particular(a) budget, Ms marketing strategy had to centre on honour provision. Building on Ms original strengths, we saw the opportunity to delight customers with superior power-to-size ratio. We identified Segments A and C as our primary and secondary target segments, as their necessitate fell within the optimal zone where our product positioning could provide a preference. With the need to reverse declining market share and boost customer satisfaction, aggressive investment in Ms R&D was necessary to instal a strong and positive brand name for our power-efficient motors and manage interior costs.This allowed us to price our motors to create value for customers while extracting value for our business. raise ontogenyd in our sales representatives and marketing communications were identified as critical in communicating MM motors value to customers, and formed the key differentiators in managing Ms dual sales force and d istributor channels. How does customer satisfaction relate to customer loyalty? Retention is a reflection of a customers willingness to remain with a particular companys service or products and is useful to mensuration customer loyalty.The relationship between MM and its customers was a close one, startle to be dissatisfied with the quality of Ms sales team. For the split between customer retention and acquisition, we learned that having a higher focus on customer retention produced much higher overall sales. Experience from earlier runs indicated that a high investment in untested customer acquisition did not trigger proportionate increase in new customer sales. This could be due to channel conflict with distributors seeking to gain new customers as well.Therefore, our eventual strategy focused on customer retention as to protect our market share, and consequently, still generate new sales through referrals from existing customers. Our heavily trained sales force did a very good job in acquiring nevus customers despite their modified time on new customer acquisition and due to our high retention rate we could rapidly expand our market share in Segment A shows the sales split teen existing and new customers. How should you manage MM set? What does it take to justify price increase? How does price deductive reasoninging affect the outcome?Market research proved to be an important tool for us to determine pricing. Initially, We thought keeping prices constant would help us gain market share that would compensate for the margin. However, we learnt that by adjusting our prices according to customers price expectations for Segments A, B and C was more effective in maximizing our revenues. Exhibit shows that as time passed, there was generally an increase in willingness to pay across these segments. Therefore, we increased our prices slowly to extract value for MM, while we aggressively increased power-to-size ratios to create value for our target segments.Thi s enabled us to increase market share. Given Segment Ads price sensitiveness, we gave them maximum discount allowed as a sales strategy and attempt to claim market share in this segment. We kept our discount rate for the distributors constant so that the distributors can better plan their distributor margin depending on their business needs. Over the course of the simulation, our pricing (across all segments) increased by a total of 2%. A conscious effort was made to increase price at a slow and incremental pace to prevent price shocks and allow the market to stabilize in response to individually price increase.Although flexibility in setting prices acts as a speedily fix for the management to achieve short-term targets, it would send mixed signals to the market and hence should be avoided when possible. We observed that our competitors reacted to our price increases in the same perpetration but consistently kept their rates lower than ours. From these reactions, we realized that competing on prices would have a detrimental effect on our refits. How do you balance short-term and long-term investments?We invested heavily in enhancing our products power-to-size ratio as to embodiment a strong brand name and gain a competitive advantage over our competitors. The market research was valuable to help us keep track of our product performance over competitors and against customer expectations, so that we can moderate our research investment over. Our strategic positioning on power-to-size ratio shown success as we observed from the market research that, aft(prenominal) 4 quarters of the simulation, our competitors started to position homeless in producing high thermal resistance products and decreased their focus on power-to-size ratio.While we limited investments on thermal resistance to improve company financial, we were able to manage the thermal resistance performance against customer expectations such that sales and customer satisfaction of our product were not affected. In addition, we gradually increased our investment in manufacturing capability in order to keep the cost of goods sold under check out in the long run How does channel conflict figure into your pricing decisions? How do you minimize channel conflict?