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Service Logic – a new Dominant Logic for Social Customer Relationship Marketing


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Why and how Marketing should shift their focus from creating momentum for value exchange towards a focus on co-creating value "in use" for the Customer and the Company.

Published in: Business, Technology

Service Logic – a new Dominant Logic for Social Customer Relationship Marketing

  1. Service Logic – a new Dominant Logic for the Social Customer Relationship Marketerby WimRampen<br />image courtesy:<br />
  2. Goods dominant logic:<br />value is created at the moment of exchange, after that, the Customer is on his own<br />value exchange: when money and ownership or rights change hands<br />image courtesy:<br />
  3. The new dominant logic: Service Logic<br />is not about selling services<br />image courtesy:<br />
  4. Service Logic: value co-creation happens AFTER value exchange<br />image courtesy: <br />
  5. Value for customers means that, after they have been assisted by a self-service or full-service process, they are – or feel – better off than before<br />image courtesy:<br />
  6. Whether a Customer is – or feels – better off is determined by the Customer<br />image courtesy::<br />
  7. Value is co-created when customer desired outcomes are met<br />in other words: when the Customer’s job is done to his satisfaction<br />image courtesy:<br />
  8. Fact: most Customers can use some help in creating value<br />image courtesy:<br />
  9. If value for the Customer is dominantly created after value exchange, i.e. IN USE, both scope and content of marketing strategies should shift from dominantly focused on creating momentum for value exchange to a continuum of interactions in networks of relationships aimed to support customers’ value creation <br />image courtesy:<br />
  10. The “new” goal for marketing is to support (and improve) customers’ value creation “in use”<br />image courtesy:<br />
  11. Value “in use” is determined by Customer outcomes of experiences during the lifetime of consumption of products & services<br />image courtesy:<br />
  12. Touch-points and interactions (in networks) of relationships are the building blocks of personalized experiences in a socially networked eco-system<br />image courtesy:<br />
  13. The firm (marketing) should strive for engagement in interactions and relationships with its customers’ (net)work or process to create value<br />image courtesy:<br />
  14. 5 Questions for today’s marketers<br />image courtesy:<br />
  15. 1. Do you understand how and to what extent your customers are meeting their desired outcomes when using (experiencing) your product or services (over its lifetime)?<br />image courtesy:<br />
  16. 2. What interactions with your product, services, partners, employees, touch-points, their networks and relationships influence and shape customers’ experiences in use?<br />image courtesy:<br />
  17. 3. What opportunities do you see to engage in the customer’s value-creation process?<br />image courtesy:<br />
  18. 4. What opportunities do you see to pro-actively help the customer meet their desired outcomes through (new ways of) interacting (in & via networks) and building relationships?<br />image courtesy:<br />
  19. 5. Who do you need to collaborate with to purposefully design & execute experiences over a lifetime of use to exploit these opportunities?<br />image courtesy:<br />
  20. How does “Social” tie into all this?<br />image courtesy:<br />
  21. A. SOCIAL CRM STRATEGY FRAMEWORK STATEMENT (version 2)<br />A socialcrmstrategy is aboutunderstandingwho the customer is throughlistening to, engagingwith and collaborationbetweencustomers, employees and partners. It is aimed at developinginnovations, interactions in networks of relationships and communitiesthat support customers in doing the jobs theyneed to do. The means are a personalized design of the service experiencethatempowerscustomers, employees and partners to influencehowwelltheycan meet theirdesiredoutcomes<br />
  22. B. 3 out of 15 new trends driving Social Business<br />Courtesy: Graham Hill<br />image courtesy:<br />
  23. B#1. From Individual Customers to Networks of Customers<br />
  24. B#12. From Stand-alone Companies to an Ecosystem of Networked Partners<br />image courtesy:<br />
  25. B#15. From Customer Lifetime Value to Customer Network Value<br />image courtesy:<br />
  26. Implications for Marketing<br />image courtesy:<br />
  27. Marketing’s 1st job is to understand customers’ value creation process (= jobs & desired outcomes) and where in the process Customers fail to meet their desired outcomes. <br />image courtesy:<br />
  28. Marketing’s 2nd job is to build relationships in communities of individuals with similar desired outcomes and behavior<br />image courtesy:<br />
  29. Marketing’s 3rd job is to support Customers’ value creation process<br />image courtesy:<br />
  30. Marketing’s 4th job is to design experiences that stimulate company’s engagement through interactions in networks of relationships<br />
  31. Marketing’s 5th job is to engage employees and partners in supporting Customers in their process of value creation<br />
  32. Marketing’s 6th job is to extract actionable insights from 360-degree feedback to foster innovations and to turn them into value propositions that attract new Customers <br />image courtesy:<br />
  33. Marketing’s 7th job is to redesign metrics to capture the network value for the firm and to ensure there is high correlation between these metrics an Customers’ value created.<br />image courtesy:<br />
  34. What about Marketing Laws?<br />
  35. The P’s remain valid, but less dominant. Focus is no longer dominantly on product and value chain towards value exchange. <br />image courtesy:<br />
  36. Segmentation based on demo/sociographics come 2nd, after segmentation based on Customer jobs & (desired) outcomes. <br />image courtesy:<br />
  37. THANK YOU LET’S START THE DEBATELeave a comment or contact me on<br />
  38. RESOURCES<br />Gummeson, Evert (2007): <br />Exit Services Marketing – Enter Service Marketing<br />Michael A. Merz & Yi He & Stephen L. Vargo (2008): <br />The evolving brand logic: a service-dominant logic perspective<br />David Ballantyne & Richard J Varey (2008): <br />The service-dominant logic and the future of marketing<br />Sara Sandstro¨m, Bo Edvardsson, Per Kristensson & Peter Magnusson (2008):<br />Value in use through service experience<br />ChristiaanGrönroos & AnikaRavald (2009)<br />Marketing and the Logic of Service; Value Facilitation, Value Creation and Co-Creation and their marketing implications<br />Graham Hill (2009)<br />A Manifesto for Social Business<br />