What do you mean by concept life time value of a customer

 In marketing, customer lifetime value (CLV) (or often CLTV), lifetime customer value (LCV), or user lifetime value (LTV) is a prediction of the net profit attributed to the entire future relationship with a customer. The prediction model can have varying levels of sophistication and accuracy, ranging from a crude heuristic to the use of complex predictive analytics techniques.

Customer lifetime value (CLV) can also be defined as the dollar value of a customer relationship, based on the present value of the projected future cash flows from the customer relationship. ^[1] Customer lifetime value is an important concept in that it encourages firms to shift their focus from quarterly profits to the long-term health of their customer relationships. Customer lifetime value is an important number because it represents an upper limit on spending to acquire new customers.^[2] For this reason it is an important element in calculating payback of advertising spent in marketing mix modeling.

One of the first accounts of the term Customer Lifetime Value is in the 1988 book Database Marketing, which includes detailed worked examples.^[3] Early adopters of Customer Lifetime Value models in the 1990s include Edge Consulting and Brand Science.

ELECTRONIC MARKETING

 Electronic Marketing (EM) is the application of a broad range of information and communication technologies for:     

• Transforming marketing strategies to create more customer value through more effective segmentation, targeting, differentiation, and positioning strategies;

• More efficiently planning and executing the conception, distribution, promotion and pricing of goods, services, and ideas; and         

• Creating exchanges that satisfy individual consumer and organizational customers’ objectives.

– Electronic Marketing (EM) is the result of information and communication technologies applied to traditional marketing. EM affects traditional marketing in two ways.          

• First, it increases efficiency in traditional marketing functions.     

• Second, the technology pf EM transforms many marketing strategies.      

The transformation results in new business models that add customer value and/or increase company profitability.

– Forms of Electronic Marketing (EM)         

• Telemarketing is the use of telephone and call centers to attract prospects, sell to existing customers, and provide service by taking orders and answering questions. For example, Tele brands, TVC, Asian Sky Shop sells their products through telemarketing.    

• Database Marketing is the development and maintenance of stakeholders data by the company so that the latter can communicate with the former in case of sending any urgent information or providing a service or offering a new product.         

• Internet or Online Marketing          

E-mail Marketing is the process of sending the product details, advertisements, information and a new product or feature, or a new offer to the selected or listed customer through email. In this case at a time the information can be sent to many customers through a single click of the email send button.

• Viral Marketing is the online equivalent of word of mouth. When individuals forward e-mail to friends, co-workers, family, and others on their e-mail lists, they are using what we like to call word of mouse or more commonly known as viral marketing.

• Search Engine Marketing is the new trend of marketing a product or service through online advertising. For example, when people search anything on Google, the reputed search engine then some search related ads are shown at the right hand side of the web page. A customer may search the prospective companies ads by typing a search keyword in Google search box and clicking on the search button, read carefully the message of the ad and still then buy any product from the concerning web site of the targeted or displayed ads.

Affiliate Marketing is the process of selling or advertising the products of another company. In this case, the owner company gives an affiliate link to the marketing company or individual and the latter promotes the link through any of the aforesaid form of online marketing and when a product is sold the latter is entitled to a commission which is given through automated online banking system.

Identify the basic steps in the recording process (June’13)

 Basic steps in the recording process: The basic steps in the recording process are identify and analyzing transaction and events

•     Recording in journals
•     Posting to the ledger
•     Unadjusted trial balance
•     Adjusting entries
•     Adjusted trial balance
•     Financial statement
•     Closing entries and
•     Post closing trial balance

What are the steps in the recording process in accounting

 Identify the basic steps in the recording process (June’13).

Basic steps in the recording process: The basic steps in the recording process are identify and analyzing transaction and events

•     Recording in journals
•     Posting to the ledger
•     Unadjusted trial balance
•     Adjusting entries
•     Adjusted trial balance
•     Financial statement
•     Closing entries and
•     Post closing trial balance

Explain the periodicity assumption and economic entity assumption

 Periodicity Assumption:  Transactions are recorded in the books of accounts on the assumptions that profits are to be ascertained for a specified period. This is known as Periodicity Assumption of Accounting.

 Economic entity assumption: In accounting, an economic entity is one of the assumptions made in generally accepted accounting principles. Basically, any organization or unit in society can be an economic entity.

 Examples of economic entities are hospitals, companies, municipalities and federal agencies.

 The "Economic Entity Assumption" says that the activities of the entity are to be kept separate from the activities of its owner and all other economic entities

What factors should be considered to determine the advertising media

 Selection of a suitable medium for advertising is really a complex problem to the advertiser. There are a number of kinds and classes of media in the modern advertising. Hence, the advertising media selection means not only the choice of the right classes of media out also the individual medium within the class or classes. Besides there is no single medium that is best suited for all advertisers. In reality, a medium which is best suited for one may be almost useless for another. The medium once employed for advertising a particular product itself may be found unsuited subsequently. Therefore, the right choice of a medium calls for a careful analysis. If the medium is unsuited the whole amount of money spent on the advertising campaign shall turn to be a waste.

The advertiser, therefore, while selecting the media, should consider the following factors:

1. Class of the audience: Firstly, the advertiser must note the class of the audience to be influenced by the medium. The audience can be classified into different groups by their social status, age, income, educational standard, religion, cultural interests. They may also be divided into men and women.
2. Extent of coverage: Secondly, the advertiser must consider the number of audience to be covered by the medium. Every media has a general as well as an effective circulation. The general circulation is made up of the total number of people who read or subscribe to the media. The effective circulation is the number prospective customers who read it and the number of those who influences sales, though they may not buy for themselves. Effective circulation must be considered while estimating the number of people to be covered. The extent to which the medium reaches the same audience as that covered by some other media i.e., the percentage of over-lapping must also be taken into account.
3. Nature of the product: Nature of the product itself is a principal factor governing the selection of the medium. Products can be classified into various kinds – consumer’s products and manufacturer’s products etc.
4. Nature of the competition: The nature of the competition exerts greater influence of the selection of the media. If the competition is stiff utmost care is needed in the selection of medium and a larger advertising budget is also required. In many cases where the advertising copy is similar or the choice of the media solely determines the effectiveness of the campaign as compared with that of the other competitors.
5. Reputation of the medium: Newspapers and magazines can offer a beautiful illustration for the reputation of the media. There are a few newspapers and magazines which have international reputation with a high readership. Advertisements in such magazines and newspapers are generally recognized and believed as true. Such advertisements also add prestige to the product.
6. Cost of the media: Cost of the medium in most cases, is an important factor in the selection of the medium. Advertisements in certain media are expensive. For instance, TV and Radio advertisements. Magazines and newspaper advertisements are generally considered as less expensive. Yet, certain magazines and  newspapers, having larger circulation and high reputation charge higher rates. The rates also differ depending upon the space occupied and the preferential positions. The first page of a newspaper is rarely missed by the reader. Hence they have more attention value, than the advertisements presented anywhere inside the newspaper.

Time and location of buying decisions: The location of the audience and the time by which it should reach them must also be looked into. This consideration also enables the advertiser to keep his retail outlets in the proximity of the customers

Discuss elaborately the social and economic importance of advertising

 Advertising is praised but also criticized by critics in their own ways. Advertising has many positive impacts along with its negative pictures. As the President of American Association of Advertising Agencies, John O’ Toole has described advertise is something else. It is not related to studies, but it educates. It is not a journalist but gives all information. And it is not an entertaining device but entertains everyone.

Now let’s go through the economic and social aspects of advertising.

Economic role of Advertising

Value of Products:

The advertised products are not always the best products in the market. There are some unadvertised products also present which are good enough. But advertising helps increase value for the products by showing the positive image of the product which in turn helps convincing customers to buy it. Advertising educates consumers about the uses of the products hence increasing its value in minds of the consumers. For e.g. mobile phones were first considered as necessity but nowadays the cell phones come with number of features which makes them mode of convenience for consumers.

Effect on Prices:

Some advertised products do cost more than unadvertised products but the vice versa is also true. But if there is more competition in the market for those products, the prices have to come down, for e.g., canned juices from various brands. Thus some professional like chartered accountants and doctors are not allowed to advertise.

But some products do not advertise much, and they don’t need much of it and even their prices are high but they are still the leaders in market as they have their brand name. e.g., Porsche cars

Effect on consumer demand and choices:

Even if the product is heavily advertised, it does not mean that the demand or say consumption rates will also increase. The product has to be different with better quality, and more variety than others. For E.g., Kellogg’s cornflakes have variety of flavors with different ranges to offer for different age groups and now also for people who want to loose weight thus giving consumers different choices to select from.

Effect on business cycle:

Advertising no doubt helps in employing more number of people. It increases the pay rolls of people working in this field. It helps collecting more revenues for sellers which they use for betterment of product and services. But there are some bad effects of advertisements on business cycle also. Sometimes, consumer may find the foreign product better than going for the national brand. This will definitely effect the production which may in turn affect the GDP of the country.

The economic aspects are supported by the Abundance Principle which says producing more products and services than the consumption rate which helps firstly keeping consumers informed about the options they have and secondly helps sellers for playing in healthy and competitive atmosphere with their self interest.

Social role of Advertising:

There are some positive and some negative aspects of advertising on the social ground. They are as follows.

Deception in Advertising:

The relation between the buyers and sellers is maintained if the buyers are satisfied with what they saw in advertise and what they got after buying that product. If seller shows a false or deceptive image and an exaggerated image of the product in the advertisement, then the relation between the seller and buyers can’t be healthy. These problems can be overcome if the seller keep their ads clean and displays right image of the product.

The Subliminal Advertising:

Capturing the Minds of the consumers is the main intention of these ads. The ads are made in such a way that the consumers don’t even realizes that the ad has made an impact on their minds and this results in buying the product which they don’t even need. But “All ads don’t impress all consumers at all times”, because majority of consumers buy products on basis of the price and needs.

Effect on Our Value System:

The advertisers use puffing tactics, endorsements from celebrities, and play emotionally, which makes ads so powerful that the consumers like helpless preys buy those products.

These ads make poor people buy products which they can’t afford, people picking up bad habits like smoking and drinking, and buy products just because their favorite actor endorsed that product. This affects in increased the cost of whole society and loss of values of our own selves.

Offensiveness:

Some ads are so offensive that they are not acceptable by the buyers. For example, the ads of denim jeans showed girls wearing very less clothes and making a sex appeal. These kinds of ads are irrelevant to the actual product. Btu then there is some ads which are educative also and now accepted by people. Earlier ads giving information about birth control pills was considered offensive but now the same ads are considered educative and important.

But at the last, there are some great positive aspects which help

• Development of society and growth of technologies
• Employment
• Gives choices to buyers with self interest
• Welcomes healthy competition
• Improving standard of living.
• Give information on social, economical and health issues.

How does business environment affect the marketing strategy?

 Every organization has to work within a framework of certain environmental forces and there is a continuous interaction between the organization and its environment. The interaction suggests a relationship between the two. This relationship can be analyzed in three ways.

First, the organization can be thought of as an input-output system. It takes various inputs-human, capital, technical-from the environment. These inputs are transformed to produce outputs-goods, services, profits-which are given back to the environment. Thus, the organization merely performs the function of input-output mediator. In this process, the environment in its interaction with the internal factors of the organization will determine what kind of inputs should be taken or outputs given.

Second, the organization can be taken as the central focus for realizing the contributions of many groups, both within and outside the organization. When these groups contribute to the well being of the organization, they must have a legitimate share in organizational outputs. These groups may be employees, consumers, suppliers, shareholders, movement, and the society in general. Thus, the organizational functioning will be affected by the expectations of these groups and the organization has to take these factors into account.

Third, the organization can be treated as operating in environment presenting opportunities and threats to it. Thus, how an organization can make the best use of the opportunities provided or threats imposed is a matter of prime concern for it. Any single approach by itself is insufficient to explain the complex relationship between the organizations and its environment Moreover, these approaches are not inconsistent to each other; they are complementary. Thus, an organization will be affected by the environment in which it works.

 The environment-organization interaction has a number of implications from strategic management point of view.

1. The environmental forces may affect different parts of the organization in different ways because different parts interact with their relevant external environment. For example, the technological environment may affect the organization’s R & D department. Further, these forces of the environment may have direct effect on some parts but indirect effect on others. For example, any change in the fiscal policy of government may affect the finance department directly but it may affect production and marketing indirectly because their program may be recasted in the light of new situation, though not necessarily.

2. The environmental influence process is quite complex because most things influence all other things. For example, many of the environmental forces may be interacting among themselves and making the impact on the organization quite complex. Moreover, the impact of these forces on the organization may not be quite deterministic because of interaction of several forces. For example, the organization structure will be determined on the basis of management philosophy and employee attitudes. But the organization structure becomes the source for determining the employee attitudes. Thus, there cannot be direct and simple cause-effect relationship rather much complexity is expected.

3. The organizational response to the environmental forces may not be quite obvious and identical for different organizations but these are subject to different internal forces. Thus, there is not only the different perception of the environmental forces but also their impact on the organization. Key factors determining responses to environmental impact may be managerial philosophy, life cycle of the organization, profitability, etc.

4. The impact of environmental forces on the organizations is not unilateral but the organizations may also affect the environment. However, since the individual organizations may not be able to put pressure on the environment, they often put the pressure collectively. Various associations of the organizations are generally formed to protect the interest of their members. The protection of interest certainly signifies the way to overcome unilateral impact of the environment on the organizations. The nature of organization-environment interaction is such that organizations, like human species or animals, must either adjust to the environment or perish.

What are the elements of marketing? Discuss in Brief

 Marketing encompasses a number of different activities such as product design, pricing, strategies, advertising and others. However these are just activities which have to be done in the process of marketing. There are also some crucial elements of marketing which are very necessary for the success of marketing and they form the backbone of marketing. There four elements are as follows.

1) Research –  If you want to launch your own company or a product what will you do? The first thing that you will do will be market research. You will like to determine what the market actually wants. Similarly, during marketing too, market research is needed to determine what message should the company adopt and which medium will be best, what positioning needs to be achieved to target the right segment. By doing market research, we can gather data which can help us in analysis and action.

2) Strategy –  Once you have your data ready, you know where your product stands and also the standing of your company in the market in terms of strengths and weaknesses. You also have an idea of what strategies will need to be implemented and what factors will need to be adopted by the company to beat competitors and succeed in the market. Thus, after research, strategies decide the vision of the company, its goal, its mission and in general where the company wants to be. The strategic plan needs to be well thought of by realistically considering all possibilities.

3) Planning –  Now that you know, Where you want to be, naturally you have to plan How you are going to reach there. That is the job of the marketing planning department. The marketing plan involves sales forecasting, financial planning, communications strategy and many such benchmarks which define how the company is going to achieve its strategic goals in the future. The planning department also keeps a track of the timeline so that time to time we can determine whether we are on track with the strategic plan or not.

4) Tactics –  Where planning happens at the topmost level, tactics are the street smart, short term plans you implement to attract customers, beat your competitors, increase sales, provide a better value for your customers or for any other short term objective which needs to be achieved. Giving an offer such as “Buy 1, get 1 free” is a sales tactic. Lessening the price of your product during festival time is a promotional tactic. Several such tactics can be implemented by the company to make sure that it is inline with the planning done in the earlier stage. Some industries, such as FMCG and consumer durable, mainly survive on time to time tactics that the implement. Due to the competitive nature of these industries, smart tactics ar absolutely necessary to achieve good revenues and for customer acquisition.

Discuss the functions of market research

Marketing research is "the process or set of processes that links the consumers, customers, and end users to the marketer through information — information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection process, analyzes the results, and communicates the findings and their implications.

The five main functions of marketing research (MR) are:

1. Description,
2. Evaluation,
3. Explanation,
4. Prediction, and
5. Aid in decision making.

Now let's discuss these prominent functions of marketing research.

1. Description : Marketing research gives full description about the consumers. It describes their age, sex, education, income, etc. It also gives a description about the competitors and the market situation. This description is used to take marketing decisions and solve marketing problems.
2. Evaluation : Marketing research helps to evaluate the company's performance. It helps to evaluate the company's production and marketing policies. It finds out the customer reaction to the quality of the product, price, packaging, advertising, sales, promotions' techniques, etc. If the consumer reactions are bad, then the company must change its policies. It also compares the company's policies with the competitors' policies.
3. Explanation : Marketing research gives explanations (answers) for all the marketing problems. For example, it answers in detail, why are the sales falling, why are the retailers giving negative reaction, etc. It gives all the causes or reasons for the problem. It also tells how to solve the problem.
4. Prediction : Marketing research also gives predictions. Predictions mean to forecast or guess about the future. It gives a prediction about the future sales, future market opportunities, future risks, future marketing environment, future consumer behavior, etc. All the prediction may not be correct. However, these predictions help the company to make future plans and policies. It helps to take advantage of future opportunities. It also helps to avoid future risks.
5. Aid in decision making : Marketing research helps the marketing manager to take decisions. It provides all the concerned data, which is necessary to take decisions. Decision making means to select a course of action from two or more alternatives. Decision making requires up-to-date and correct data. MR helps the marketing manager to take decisions. It provides all the data, which is necessary to take decisions. It also provides alternative course of action. It gives the merits and demerits of each course of action. It also helps the marketing manager to choose the best course of action. It helps the marketing manager in all aspects of distribution, selection of sales promotion techniques, selection of media for advertising, etc. So, MR helps to take quick and correct marketing decisions. It also helps to implement the marketing decisions.

Marketing management is a demand management-Evaluate this comment..(May 2011)

 Marketing Management As Demand Management

Marketers are skilled in stimulating demand for a company’s products. But this is too limited view of tasks marketers performs. Just as production and logistics professionals are responsible for “supply management: marketers are responsible for “Demand management.”

 Marketing Managers undertake the following 3 responsibilities in order to meet the organizational objectives;

1.      To influence the level of demand

2.      To influence the timing of demand and

3.      To influence the composition of demand.

 

In accomplishing these responsibilities, it is useful for marketing managers to identify different states of demand and the corresponding tasks facing them, which is given below;

 1.      Negative  demand

A market is in a state of negative demand if a major part of the market dislikes the product and may even pay a price to avoid it.

 Ex; vaccinations, dental works, vasectomies etc,

The marketing task is to analyze why the market dislikes the product and whether a marketing program consisting of product redesign, lower prices and more positive promotion can change beliefs and attitudes. 

Marketing is the delivery of standard of living to society-Expalin the Justification of this Comment (May 2011)

 The role of marketing is to facilitate exchanges. Its essence is to create greater contentment and satisfaction by recognizing the preference structures of both parties and crafting the basis for exchanges. Marketing’s value to society is that it creates more efficient and effective interaction between and among individuals and organizations.

Marketing is endemic to society. Whenever there is an exchange or an attempted exchange of something of value for something else of value, the marketing process is at work. The process of marketing pre-dates written history, where individuals bartered goods and services in exchange for other goods and services to produce a more satisfying life than one they could produce for themselves.

Five conditions must be met for an exchange to take place:                                   

1.There are at least two parties.         
2.Each party has something that might be of value to the other party.         
3.Each party is capable of communication and delivery.      
4.Each party is free to accept or reject the offer.       
5.Each party believes it is appropriate or desirable to deal with the other party.      

These five conditions are inherent in ancient markets, where farmers and craftsmen brought their produce and wares to a central market. So too it applies to today’s flea markets, garage sales and ebay transactions. It also applies to the sophisticated supply chains necessary to stock a Wal-Mart store or build a missile system for the military.

Marketing is pervasive in all human endeavors. Most human interaction requires an understanding of the other party’s perspective in order to have a productive relationship. Therefore the principles of marketing are applied in both for-profit and not-for-profit settings, including the marketing of places, causes, events, organizations, and persons. For simplicity of presentation in this book, we will refer to the parties in the exchanges as buyers and sellers to represent a commercial transaction between a producer and a customer, 

Discuss the importance of strategic planning in the development of Bangladesh Banking Services (June’13).

 Importance of strategic planning in the development of Bangladesh Banking Services: Strategic planning is the most important key for solving strategic tasks; it is the process of developing, controlling and maintaining a strategic balance between organizational goals and resources in the market environment. A strategic plan is a set of activities that are geared towards an organizations growth and success. Strategic management refers to the art of business planning at the highest possible level implemented by the company's leader or leaders and is focused on building a solid underlying foundation for a company.

 Simply put, a strategic plan is the formalized road map that describes how your company executes the chosen strategy. A plan spells out where an organization is going over the next year or more and how it’s going to get there. Typically, the plan is organization-wide or focused on a major function, such as a division or a department.

 A strategic plan is a management tool that serves the purpose of helping an organization do a better job, because a plan focuses the energy, resources, and time of everyone in the organization in the same direction.

 If you’re thinking, “Hey, I’ve got this great book on business plans, so I’ll just use that to form my strategic plan,” be aware that strategic plans and business plans aren’t the same concepts.

 A strategic plan is a management tool that C-level managers need to master and is for established businesses and business owners who are serious about growth. It also does the following:

 Helps build your competitive advantage

2. Communicates your strategy to staff
3. Prioritizes your financial needs
4. Provides focus and direction to move from plan to action

 A business plan, on the other hand, is a planning tool for new businesses, projects, or entrepreneurs who are serious about starting a business. A business plan

1. Helps define the purpose of your business
2. Helps plan human resources and operational needs
3. Is critical if you’re seeking funding
4. Assesses business opportunities
5. Provides structure to ideas

Key components of strategic planning:

 Vision: Outlines what the organization wants to be, or how it wants the world in which it operates to be (an "idealized" view of the world). It is a long-term view and concentrates on the future. It can be emotive and is a source of inspiration.

For example, a charity working with the poor might have a vision statement which reads "A World without Poverty."

 Mission: Defines the fundamental purpose of an organization or an enterprise, succinctly describing why it exists and what it does to achieve its vision.

For example, the charity above might have a mission statement as "providing jobs for the homeless and unemployed".

 Values: Beliefs that are shared among the stakeholders of an organization. Values drive an organization's culture and priorities and provide a framework in which decisions are made. For example, "Knowledge and skills are the keys to success" or "give man bread and feed him for a day, but teach him to farm and feed him for life". These example maxims may set the priorities of self-sufficiency over shelter.

 Strategy: Strategy, narrowly defined, means "the art of the general" -a combination of the ends (goals) for which the firm is striving and the means (policies) by which it is seeking to get there. A strategy is sometimes called a roadmap - which is the path chosen to plow towards the end vision. The most important part of implementing the strategy is ensuring the company is going in the right direction - defined as towards the end vision.

So, we can say that strategic planning in the development of need for any organization not only Bangladesh Banking Services.

Marketing control is the process of measuring and evaluating the results of marketing strategies and plans and taking corrective actions to ensure that objectives are achieved. Discuss

 Because many surprises occur during the implementation of marketing plans, the marketing department must practice constant marketing control. Marketing control involves evaluating the results of marketing strategies and plans and taking corrective actions to ensure that objectives are attained. Marketing control involves four steps. Management first sets specific marketing goals. It then measures its performance in the market place and evaluates the causes of any differences between expected and actual performance. Finally Management takes corrective actions to close the gaps between its goals and performance. This may require changing action programs or even changing the goals

Operating control involves checking ongoing performance against the annual plan and taking corrective action when necessary. Its purpose is to ensure that the company achieves sales, profits and other goals set out in its annual plan. It also involves determining profitability of different products, territories, markets and channels.

Strategic Control involves looking at whether the company’s basic strategies are well matched to its opportunities. Marketing strategies and programs can quickly become outdated and each company should periodically reassess its overall approach to the market place. A major tool for such strategic control is a marketing audit. The marketing audit is a comprehensive, systematic, independent and periodic examination of a company’s environment, objectives, strategies and activities to determine problem areas and opportunities. The audit provides good input for a plan of action to improve the company’s marketing performance.

The marketing audit covers all major marketing areas of a business, not just a few trouble spots. It assesses the marketing environment, marketing strategies marketing organization, marketing systems, marketing mix and marketing productivity and profitability. The audit is normally conducted by an objective and experienced outside party. The findings may come as surprise- and sometimes as a shock to management. Management then decides which actions make sense and how and when to implement them.

Market Environment

The market environment is a marketing term and refers to factors and forces that affect a firm’s ability to build and maintain successful relationships with customers. Three levels of the environment are 3: Micro (internal) environment - small forces within the company that affect its ability to serve its customers. Meso environment – the industry in which a company operates and the industry’s market(s). Macro (national) environment - larger societal forces that affect the microenvironment.^[1]

The Marketing Environment

Elements of the environment. The marketing environment involves factors that, for the most part, are beyond the control of the company. Thus, the company must adapt to these factors. It is important to observe how the environment changes so that a firm can adapt its strategies appropriately. Consider these environmental forces:

• Competition: Competitors often “creep” in and threaten to take away markets from firms. For example, Japanese auto manufacturers became a serious threat to American car makers in the late 1970s and early 1980s. Similarly, the Lotus Corporation, maker of one of the first commercially successful spreadsheets, soon faced competition from other software firms. Note that while competition may be frustrating for the firm, it is good for consumers. (In fact, we will come back to this point when we consider the legal environment).Note that competition today is increasingly global in scope. It is important to recognize that competition can happen at different “levels.” At the brand level, two firms compete in providing a very similar product or service. Coca Cola and Pepsi, for example, compete for the cola drink market, and United and American Airlines compete for the passenger air transportation market. Firms also face less direct—but frequently very serious—competition at the product level. For example, cola drinks compete against bottled water. Products or services can serve as substitutes for each other even though they are very different in form. Teleconferencing facilities, for example, are very different from airline passenger transportation, but both can “bring together” people for a “meeting.” At the budget level, different products or services provide very different benefits, but buyers have to make choices as to what they will buy when they cannot afford—or are unwilling to spend on—both. For example, a family may decide between buying a new car or a high definition television set. The family may also have to choose between going on a foreign vacation or remodeling its kitchen. Firms, too, may have to make choices. The firm has the cash flow either to remodel its offices or install a more energy efficient climate control system; or the firm can choose either to invest in new product development or in a promotional campaign to increase awareness of its brand among consumers.
• Economics. Two economic forces strongly affect firms and their customers:
• Economic Cycles. Some firms in particular are extremely vulnerable to changes in the economy. Consumers tend to put off buying a new car, going out to eat, or building new homes in bad times. In contrast, in good times, firms serving those needs may have difficulty keeping up with demand. One important point to realize is that different industries are affected to different degrees by changes in the economy. Although families can cut down on the quality of the food they buy—going with lower priced brands, for example—there are limits to the savings that can be made without greatly affecting the living standard of the family. On the other hand, it is often much easier to put off the purchase of a new car for a year or hold off on remodeling the family home. If need be, firms can keep the current computers—even though they are getting a bit slow—when sales are down. The economy goes through cycles. In the late 1990s, the U.S. economy was quite strong, and many luxury goods were sold. Currently, the economy fluctuates between increasing strength, stagnation, or slight decline. Many firms face consequences of economic downturns. Car makers, for example, have seen declining profit margins (and even losses) as they have had to cut prices and offer low interest rates on financing. Generally, in good economic times, there is a great deal of demand, but this introduces a fear of possible inflation. In the U.S., the Federal Reserve will then try to prevent the economy from “overheating.” This is usually done by raising interest rates. This makes businesses less willing to invest, and as a result, people tend to make less money. During a recession, unemployment tends to rise, causing consumers to spend less. This may result in a “bad circle,” with more people losing their jobs due to lowered demands. Some businesses, however, may take this opportunity to invest in growth now that things can be bought more cheaply.

Inflation. Over time, most economies experience some level of inflation. Therefore, it is useful to explicitly state whether a reference to money over time involves the actual dollar (or other currency) amount exchanged at any point (e.g., one dollar spent in 1960 and one dollar in 2007) or an “inflation adjusted” figure that “anchors” a given amount of money to the value of that money at some point in time. Suppose, for example, that cumulative inflation between 1960 and 2007 has been 1,000%--that is, on the average, it costs ten times as much to buy the same thing in 2007 as it did 47 years earlier. If the cumulative inflation between 1960 and 1984 had been 500%, we could talk about one 1984 dollar being worth fifty 1960 cents or two 2007 dollars. It is important to note that inflation is uneven. Some goods and services—such as health care and college tuition—are currently increasing in cost much higher than the average rate of inflation. Prices of computers, actually decline both in absolute numbers (e.g., an average computer cost $1,000 one year and then goes for $800 two years later) and in terms of the value for money paid once an adjustment has been made for the improvement in quality. That is, two years later, the computer has not only declined in price by 20%, but it may also be 30% better (based on an index of speed and other performance factors). In that case, then, there has actually been, over the period, a net deflation of 38.5% for the category.

A bank must be customer centered to succeed-Discuss

 The business of financial services is transforming before our eyes. Traditional banking and insurance products have become commoditized. As each day passes, consumers demand increasingly personalized products and services. Social and mobile channels continue to overthrow traditional communication methods. To survive and grow in this complex environment, financial institutions must do three things:

1. Attract and retain the best customers
2. Grow wallet share
3. Deliver top-notch customer experience across all channels and touch points

The finance industry is traditionally either product centric or account centric. However, to succeed in the future, financial institutions must become customer centric. Becoming customer-centric requires changes to your people, process, technology, and culture. You must offer the right product or service to the right customer, at the right time, via the right channel. To achive this, you must ensure alignment between business and technology leaders. It will require targeted investments to grow the business, particularly the need to modernize legacy systems.

To become customer-centric, business executives are investing in Big Data and in legacy modernization initiatives. These investments are helping Marketing, Sales and Support organizations to:

• Improve conversion rates on new marketing campaigns on cross-sell and up-sell activities
• Measure customer sentiment on particular marketing and sales promotions or on the financial institution as a whole
• Improve sales productivity ratios by targeting the right customers with the right product at the right time
• Identify key indicators that determine and predict profitable and unprofitable customers
• Deliver an omni-channel experience across all lines of business, devices, and locations

At Informatic, we want to help you succeed. We want you to maximize the value in these investments. For this reason, we’ve written a new eBook titled: “Potential Unlocked – Improving revenue and customer experience in financial services”. In the eBook, you will learn:

• The role customer information plays in taking customer experience to the next level
• Best practices for shifting account-centric operations to customer-centric operations
• Common barriers and pitfalls to avoid
• Key considerations and best practices for success
• Strategies and experiences from best-in-class companies

Describe the four steps that lead management and the firm through the strategic planning process

 The strategic plan will serve as a guide for allocation of the firm's resources. It will allow the firm to plan its lawyer activity more productively, i.e., the time spent on fee producing work, practice development and image enhancement, management of administrative and substantive activities, recruiting, etc. The strategic plan will also enable attorneys to appraise the results of their efforts. The strategic planning process is usually undertaken in the following four phases: (1) Self Assessment, (2) Analysis of Data Base, (3) Draft Objectives for Presentation to Partners, and (4) Implementation of the Plan.

Phase 1: Self Assessment

This phase involves the managing partner, management committee or strategic planning committee to survey all or a representative number of lawyers through personal interviews, questionnaires or a combination of both to obtain their perceptions about internal and external trends that will have an effect on the firm. Examples of issues that are usually addressed during the self assessment follow:

1. The philosophy, objectives and plans currently guiding the firm

2. The firm's culture

3. The form and effectiveness of firm governance, organization and administration

4. How effectively the firm's growth has been managed

5. Partner/associate relationships, i.e., the ratio of associates to partners, classes of partners and associates, criteria for admission to partnership, communications among and between partners and associates, retirement planning, etc.

6. Firm economics, i.e., partner satisfaction with gross revenue and net profit, individual net income, hourly and billing expectation from partners and associates, etc.

7. Areas of practice management, i.e., does the firm deliver legal services in a quality, timely and profitable manner?

8. Firm resources and capabilities, i.e., strengths and weaknesses, as related to resources, reputation, services and legal market position.

9. Client perceptions and partner willingness and ability to sell legal services, etc.

10. An assessment of the legal market environment, including size, synergism, trends, competition, client behavior, etc.

11. A forecast of the political, social and economic forces of change that will effect the firm and its clients.

Phase 2: Analysis of Data Base

This phase of the process involves analyzing the data base to highlight those key internal and external factors affecting the firm. Planners should be especially interested in obtaining partners' perceptions about the following:

1. Firm Strengths

2. Firm Weaknesses

3. Competitive Advantages

4. Competitive Disadvantages

5. Number of full time lawyers - both partners and associates and their ages

6. Administrative personnel

7. Main sources of clients and income from principal clients over the past three to five years and important changes that would effect client volume favorably or unfavorably

8. Inventory of unbilled time, accounts receivable, costs advanced

9. Billable and non-billable hours

10. Health problems or personal idiosyncrasies of partners

11. Anticipated tangs in the partner compliment, i.e., retirement, withdrawal, etc.

Phase 3: Draft Objectives for Presentation to Partners

This phase includes drafting objectives for presentation to the partners in each of the areas studied. The following is an abbreviated presentation of marketing plan objectives and strategies prepared for one of the author's mid-size law firm clients.

Illustrative Marketing Plan Objectives:

1. To serve well, efficiently, economically, and fully the firm's existing clients (This objective, properly carried out, is probably the most important).

2. Growth - Does the firm wish to grow? An objective of most marketing plans is to increase the number of quality clients served by the firm in targeted industries and practice areas.

3. To identify and market whatever strengths or unique services the particular law firm may have to offer including, for example:

(a) The firm's ability to handle complex and multi-dimensional problems

(b) The firm's expertise in one or more substantive areas of the law

(c) For a firm with branch offices, the ability to better serve clients through one or more offices

4. To increase the firm's exposure in the marketplace.

Illustrative Marketing Strategies:

1. To implement a marketing plan

2. To analyze the market or markets where the firm practices

3. To identify substantive areas of practice where the firm is weak or understaffed an act to correct the situation

4. To determine which of the firm's strengths should be brought to the attention of existing and prospective clients in the markets where the firm practices

5. To identify a specific number of prospective new clients and assigning responsibility to specific lawyers to deal with the prospects, directly or indirectly

6. To meet with each major existing client and determine:

(a) Whether the client is satisfied with the firm's representation
(b) How the firm might improve from the client's perspective
(c) What other services might be performed (In this regard, some firms have developed client evaluation questionnaires).

7. To analyze the mailing list for firm announcements and determine whether it should be expanded or modified

8. To identify a specified number of potential referral sources and inform them about the firm

9. To identify seminars (including CLE, trade association, and client seminars) in which the firm's attorneys should participate and/or which the firm should sponsor

10. To develop and make effective use of a firm resume. In this regard, the firm may employ a general firm resume, together with resumes for its individual lawyers, its specialty groups, and its branch offices, the use of which is tailored to the perceived interest or needs of a particular client or prospective client

11. To identify and encourage participation in appropriate service, political, social, alumni/ae and similar organizations, where individual lawyer participation would be beneficial

12. To organize internal programs to keep the lawyers in the firm informed about marketing activities

13. To publish informational memoranda and pamphlets on new areas of law

14. Longer term strategies for accomplishments over three, four or five years

15. Periodic reviews of the effectiveness of the marketing plan should be scheduled and the plan should be revised in light of experience

Phase 4: Implementation of the Plan

The pay off for strategic planning is in the implementation of the plan. This is frequently the most difficult part of the strategic planning process. It is recommended that the plan be implemented through the firm's existing organizational structure, i.e., the managing partner, the strategic planning committee, heads of substantive practice areas and branch offices as required. Individual partners should be assigned responsibility and held accountable for the satisfactory implementation of each phase of the plan in accordance with an agreed upon timetable. Partners responsible for the implementation phase should report to the managing partner, strategic planning committee or other group designated to oversee the planning process. Problems and/or progress should be reviewed and assessments made to determine the most appropriate strategies to be followed. Status reports should be provided to the other partners on progress and/or problems in each phase of the plan in order to keep them apprised about the planning activities.

The implementation must be monitored to assess how effectively the plan is being implemented and corrective action must be taken as required.

Conclusion

Strategic planning is a dynamic process. If conceived properly and implemented effectively, the strategic planning process will provide information required for determining immediate and longer term goals and objectives.

What are the different ways that banks can follow to distribute their products directly

 Direct marketing consists of direct communications with carefully targeted individual consumers to obtain an immediate response. Interactivity is essential to this process.

Major forms of direct marketing are summarized below:

i. Face-to-Face Selling

ii. Telemarketing

iii. Direct-Mail Marketing

iv. Catalog Marketing

v. Online Marketing and Electronic Commerce

i. Face-to-Face Selling

The original and oldest form of direct marketing is the sales. Today, many companies’ still use salespersons or representatives to reach their prospects, develop them into customers, build lasting relationships, and grow the business.

ii. Telemarketing

In telemarketing telephone is used to sell directly to consumers. Two general types of telemarketing include:1). Outbound telephone marketing to sell directly to consumers.2). Inbound toll-free 800 numbers to receive orders from television and radio ads, direct mail, or catalogs. 900 numbers are used to sell consumers’ information, entertainment, or the opportunity to voice an opinion on a pay-per-call basis. Many customers appreciate the offers they receive by telephone, however, because of the recent explosion in unsolicited telephone marketing, lawmakers are responding with efforts to control unsolicited telemarketing during certain hours of the day. Most telemarketers support some form of legislation.

iii. Direct-Mail Marketing

Direct mail marketing involves sending an offer, announcement, reminder, or other item to person at a particular address. Direct mail is well suited to direct, one-to-one communication.

Advantages include:

1). High target-market selection

2). Personalized.

3). Flexible.

4). Allows easy measurement of results.

Even though the cost per thousand can be high, the people who reached through direct marketing are better prospects than those who reached with other media.

New forms of direct mail include:

1). Fax mail.

2). E-mail.

3). Voice mail.

iv. Catalog Marketing

Catalog marketing involves selling through catalogs mailed to a selected list of customers or made available in stores. A catalog is a printed, bound piece of at least eight pages, selling multiple products, and offering a direct ordering mechanism. Some stores offer a complete line of goods through their catalogs. Most direct retailers have put their catalogs on the World Wide Web. Web catalogs are passive and must be marketed themselves.

v. Online Marketing and Electronic Commerce

Online marketing is conducted through interactive online computer systems, which link consumers with sellers electronically. There are two types of online channels:

1). Commercial online services offer information and marketing services to subscribers who pay a monthly fee. The best known is America Online.

2). The commercial online services are now being overtaken by the Internet as the primary online marketing channel. The Internet is a vast and burgeoning global web of computer networks. The World Wide Web is a popular meeting place for consumer and business commerce.

Elaborate the problems of marketing administration in bank. (Dec 12)

Ans: For any market economy, banks are a key element. The role of banks is to take the excess capital from those that have it and to give it to use to those that need it. For services rendered, real-world bank collects fees and interest.

The success of a bank depends on the bank's ability to build good relationships with customers and partners.

For this reason, banks often hire managers and / or administrators who are responsible specifically for managing relationships with clients.

Responsibilities

A bank administrator must know how to work with the public, must be organized, quick to assimilate the rules and active. He is also responsible for increasing or maintaining bank deposits. This may mean developing programs that use incentives to increase the number of bank customers or developing programs that encourage new customers to invest in the bank. Bank administrators work closely with the bank president and marketing team in developing these programs. Bank manager may also work on other aspects of the bank's growth, such as loan department, investment advisors, or even mortgage and finance divisions of the bank.

Resolving customer complaints and their problems is also the bank manager's responsibility. Good communication skills and ability to calmly resolve conflicts is essential to a bank manager. Sometimes, the bank manager may be involved in legal issues relating to the dismissal of employees for theft and other issues, although this is not a common occurrence.

Handling customer complaints and issues is also the responsibility of the bank manager. Bank administrators are responsible for establishing relationships with other institutions with which the bank needs to be in permanent relationships. Given the increasing automation of banking services, bank-relations managers are now based more on price, the provision of loans and bundling services in packages at reduced prices in order to attract customers, according to association of professional financial sector of the bank.

Working conditions

A bank administrator spends a great deal of time available in the office, to handle the administrative side, the team he leads and customers. He can occasionally go through areas with offices, lobby for cash register and interact with staff and customers. Although the bank can work for fewer hours than traditional work week, he has to work at home frequently to solve any problem occurred in the evening or on weekends.

Typically, bank administrators exceed the daily work program, working overtime and leave the office looking for new clients and opportunities to promote services offered by the bank.

In certain circumstances, bank administrators can meet with customers at irregular periods such as late at night or on weekends, depending on the client's situation.

Skills

A Masters in Business Administration is often necessary to become a bank administrator. They often need prior experience in banking and must have a thorough understanding of products and services offered by banking institution. Many rented their bank managers who specialize in certain types of customers such as legal clients. These managers must have the skills necessary to be a successful sales representative, such as negotiation skills and interpersonal skills. They must have very good communication skills to be able to explain to the customer or to the other institution what solutions the bank can offer.