Lecture 1
Value/Supply chains: combinations of companies that produce, distribute and eventually deliver
products to the end user.
10 characteristics of B2B relationships
1. The Pareto principle: 20% of the causes leads to 80% of the results. In B2B, 20% of hte customers
is good for 80% of the supplier's success. There are differences in the importance of customers
for suppliers.
2. Power in the value chain: in some supply chains, the customer has the power to decide to do
business. In some supply chains, the suppliers are so powerful that the suppliers have the power
in the chain.
3. Growing interdependence
4. Intensive relationships
5. Multiple source supplierships: for one product one main suppliers, but also have some
alternative suppliers so that they can compare prices.
6. Digitalization
7. Ambidexterity: as a company, you have to walk on two legs. They have to focus on customer
satisfaction and cost reduction to offer products and goods at a competitive price level
8. From acquisition to retention: better to keep existing customers than to acquire new customers
9. From volume and market share to profitability: as a company you can have a lot of revenue, but
when you don't have profits you have a problem
10. Commoditization in markets: the only way to differentiate is lower in price.
,Value/supply chains: combinations of companies that produce, distribute and eventually deliver
products to the end user
Creating value through customer
value marketing (CVM)
- Approach: designing,
organizing and delivering
value propositions to the
customer segments the
company wants to serve. The
propositions are in line with
their value for the company
and the value desired by
these customers.
- Result: this to make sure that
these customers experience a
superior value, are satisfied, have a trust-based relationship and are committed and loyal
towards the company. This eventually to be financially successful on the long term and
contribute to the shareholder value of the company
B2C situations are supported by B2B processes. To realize
those processes there are complex supply chains that:
- deliver/distribute final goods to warehouse/retail
outlets
, - Produce goods
- Process raw materials
- Supply and purchase materials
→ Together these processes need to be integrated to enable what has been promised and agreed in the
B2B marketing in order to satisfy the buyers (deliver demand)
Issues:
- Customers differ in their
demands/wishes and
relevance
- Delivery times and
requirement get tighter, while
the supply chain is becoming
more complex
- Trend from commodities to
specialties and customer
specific products: more
complexity
- Increasing number of
disruptions: natural and man made
Lecture 2: VOC/VFC & Customer Segmentation
Supplier ←→ customer
- Value for supplier: getting revenue,
getting profits, social versus the
cost/investment in the products delivered
- Value for the customer: getting products,
social versus the price/total cost to pay
Social exchange theory: describes people's social behavior when exchanging resources in an exchange
relationship. Social exchange theory provides a framework for understanding how individuals make
decisions about their relationships based on their perceptions of the costs and benefits associated with
those relationships. Companies get involved in social exchanges because of the scarcity of resources and
the need to obtain them from other parties
● Exchange interactions involve economic and/or social outcomes;
● The costs for both partners should be balanced
, Equity theory: suggests that individuals evaluate their relationships based on a comparison of their
contributions and rewards relative to those of their partner, with a desire for fairness and equity. When
individuals perceive that their contributions and rewards are not balanced with those of their partner,
they may experience a sense of inequity. If they perceive that they are receiving fewer rewards relative
to their contributions than their partner, they may feel under-benefited or exploited. On the other hand,
if they perceive that they are receiving more rewards relative to their contributions than their partner,
they may feel over-benefited or guilty.
Stakeholder theory: a theory that is aligned with the movement to counteract the belief that
shareholders are the only companies stakeholders and are the only beneficiaries. There are various
groups having a stake in the operation of the company. An organization has to take into account the
needs of its various stakeholders and balance their divergent interests and an organization needs to have
consideration, respect, fair treatment, obligations, duties and responsibilities for all stakeholder
● Primary stakeholders are those who have a direct and contractually determined relationship
with the company like customers, employees, managers, and shareholders.
● Secondary stakeholders are actors at the organizations’ boundaries without a contractual
relationship like the direct environment, civil society, and pressure groups.
VOC and VFC
VOC: refers to the financial value that a customer brings to a business over the course of their
relationship with that business. This includes not only the revenue that the customer generates through
their purchases, but also the potential for future purchases, referrals to other customers, and positive
reviews or word-of-mouth marketing. Understanding the value of the customer can help businesses
make decisions about how to allocate resources and prioritize customer retention efforts.
Direct financial value Indirect financial value Relational value
● Revenue ● Indirect sales ● Compatibility
● Buying patterns ● Customer knowledge ● Interpersonal
● Profitabilityp & custom relationships
lifetime value ● communication/openness
● risk ● Trust & commitment
VFC: refers to the perceived benefits that a customer
receives from a business's products or services relative
to the costs of those products or services. This can
include not only the functional benefits of the product
or service (such as its quality, reliability, or ease of use)
but also the emotional benefits (such as feelings of
satisfaction, happiness, or confidence) and social
benefits (such as status, prestige, or belongingness)
that the customer derives from the product or service.
