Consumer franchise- Brand values
- Corporate image
- Benefit focused
Customer value- Costs of ownership
- Value-adding relationship
- Service quality
Marketing advantageSupply chain effectiveness- Low cost supplier
- Reduced asset base
- Quick response
486 The Marketing Book
what it was. Perhaps because of growing buyer
sophistication, or because of a growing sim-
ilarity in the composition and functionality of
competing products, or because of the empha-
sis on price competition and frequent discount-
ing activity, the power of the brand seems to be
in decline (Brady and Davis, 1993). This phe-
nomenon seems to be widespread – from
computers to cars.
It is important to distinguish between
brandloyaltyand brand preference. Many cus-
tomers have a preference for a brand or a
supplier and will typically express that prefer-
ence through their purchasing behaviour. How-
ever, when the preferred brand is not available,
those same customers will quite readily choose
an acceptable substitute. This is equally true in
industrial markets or consumer markets, for
example the choice of suppliers to a just-in-time
manufacturer is very much influenced by deliv-
ery reliability. Similarly, a retailer in making
shelf space allocation decisions will look very
carefully at vendors’ logistics performance.
The traditional means through which mar-
keters have differentiated their offer from those
of competitors, such as advertising and claimed
product superiority, need to be augmented by a
greater emphasis upon building customer rela-
tionships and customer value through service.
Today’s customer is far more sensitive to
service than was previously the case. Survey
after survey suggests that perceived quality
and service outstrip price as the determining
factor in choice of supplier in many markets.
The revised model of marketing effective-
ness that is increasingly being recognized is
shown as Figure 19.1, which emphasizes that
relationships with customers are of equal
importance as the relationships we have with
consumers, and that both of these need to be
underpinned by superior supply chain
management.
What is being suggested is that it is no
longer sufficient to have a strong franchise with
theconsumer– meaning that because of supe-
rior brand values or corporate image the
supplier can expect continuing market success.
Strong consumer franchises need to be aug-
mented by equally strong relationships with
channel intermediaries – the customerfranchise.Figure 19.1 The convergence of marketing and supply chain management