The text defines marketing as managing profitable relationships, and later in Chapter 1 talks about measuring the value of customers with the idea that some customers are not worth keeping. In your...

Marketing Management
The text defines marketing as managing profitable relationships, and later in Chapter 1 talks about measuring the value of customers with the idea that some customers are not worth keeping. In your view what are the pros and cons of using this approach?
Solution:
As per the American Marketing Association, Marketing can be termed as an activity which focuses on creating, communicating, delivering and exchanging different offerings which benefits the organization as well as the stakeholders and society. The success of the organization greatly depends on the marketing ability of the organization. There has been different orientation of marketing which was followed by the companies across the globe. Initially the organizations focused greatly on the product, the company worked on product orientation. The product concept focused on adding different features in the product with a strong focus on quality, performance and innovative features of the product which will help in attracting more and more consumers, but now the focus of the organizations have changed to consumers i.e. the organizations work on consumer oriented concept in which the companies focuses on designing their products and services as per the need and requirement of the consumers. This is the concept that is being followed by the major organizations, example Hollywood movies focuses on providing entertainment to the consumers rather than making a movie. The organizations focus on building strong strategies so as to attract more and more consumers so as to increase the profitability of the company. The marketing concept revolves around the customers, the value of the customers is very important as it helps in analyzing the worth of the customers as it is generally said that the 80% of the firm’s profits comes from 20% of the consumers, with the analysis of the customer the company is able to analyze the lifetime worth of the consumers and their value to the firm. By analyzing the value of the customer the firm is able to increase its value by boosting the number, scope and duration of the value enhancing customer relationship.
If we look at the product life cycle, what are your options in the decline stage? Explain each.
Solution:
Decline stage is the stage when the sales of the company start dropping. Products in this stage uses more financial as well as management resources than its expected future worth. The two main strategies that can be used by the organization under the decline stage is Deletion i.e. to drop the particular product from the product line of the company. This is a difficult step as it is difficult for the company to drop the product completely as the product is still left with some residual consumers. The second strategy harvesting where the firm focus to reduce the marketing costs, in this case the company will not be focusing on its sales and advertisement, the company will have a strong focus on maintaining the ability to meet the requests and demand of the consumers.
Also in the product life cycle, do you see any correlation between the Boston Consulting group model of product management (Stars, Cash Cows, Rising Stars, etc.) Explain.
Solution:
BCG model typically helps the big organization where business can be segmented in the various strategic business units (SBU). This model helps organization to allocate the resources to their SBU as per the segment they fall in the below BCG chart. They are segmented in four categories dogs, Question mark, Stars and cash cows.
Dogs – Dogs are the segment of model where companies have low market share and growth rate. They don’t either generate or take up large resource of the company. This can be considered as the...