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Each month AR runs numerous contests as a way for our members to engage in activities
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These state pages or hyper-local pages provide content directly related to a specific geographical location.
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On a personal basis, there are likely almost as many definitions of success as there are people in the world.
In marketing, though, there are just four measurable elements of success:
Profitability, Market Share, Customer Satisfaction and Customer Retention.
Profitability requires little explanation. The very reason businesses exist is to make a profit, or generate more revenue than they pay out. Profitability may be increased by reducing overhead and the cost of goods sold-or by increasing the price to the buyer.
But prices can only be raised so much. Per the laws of price elasticity, as prices rise, unit sales tend to decline, as does Market Share; which brings us to our next measure of marketing success.
Market Share, as a measure of success, is important to marketers since the greater the share, the more stable the brand"s performance is in the marketplace. A product with 65% market share is a force with which to be reckoned. A product with 3% share is vulnerable to a variety of market factors such as competitive pricing, promotions, loyalty to better-known brands and more.
Financial managers understand the impact of Profitability and Market Share. But concepts such as Customer Satisfaction and Customer Retention are softer items and tend to be treated as lesser by those managers. Yet, the long term success and growth of a brand is highly dependent on them.
Customer Satisfaction doesn"t appear on a balance sheet. It can"t be measured in dollars and cents. It"s measured by the customer"s feelings about a brand. Does the brand deliver its promise? Is it a good value? Does it bring status to the owner? Is the customer generally happy with the product? Customer Satisfaction begets repeat purchases, loyalty, word-of-mouth advertising and, of course, long-term profitability via Customer Retention.
Customer Retention, the final measure of marketing success, is closely tied to Customer Satisfaction, Profitability and Market Share.
A satisfied customer is likely to remain loyal to a brand, thus enhancing market share over the long-term, as new customers are acquired. Retained customers increase the profitability of a brand. In the course of acquiring new customers, retained customers" purchases can be counted on for continued profit performance.
It"s widely known that it"s five times more expensive to acquire a new customer than it is to keep an old one. Makes you wonder why marketers don"t generally invest more in Customer Retention, doesn"t it?
Few business organizations focus on all four elements of marketing success, probably because they"re difficult to balance and manage as separate items, yet they"re strongly interdependent.
The four elements of marketing success are reasons enough for financial managers and marketing managers to gain a better understanding of one another"s" disciplines and work toward the common good of their companies.
Mark Levit is managing partner of Partners & Levit Advertising and a professor of marketing at New York University. For more information visit http://www.partnerslevit.com or call 212.696.1200.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.