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G4_[CO]-Ch5-Added value (Own loyalty program (Thanks in kind, Save best…
G4_[CO]-Ch5-Added value
Own loyalty program
Thanks in kind
Save best thank you
Don’t say thank you too quickly or slowly
Say that you’re going to say thank you
Say thank you in a way that builds your business
Compete for loyalty
Allow competitors have loyal customers
Say thank you even if monopoly
Say thank you to your suppliers
Imitation
Win-lose +lose-win=Lose-lose
Win-win+win-win=win-win
Captive Market
Tennessee legislature has concluded
the prisons run by
private enterprise
a growing phenomenon
CCA
managed to save cost
Added Value of a Relationship
how to provide high quality at low cost
dont't have much added value
don't make much money
Creating Loyalty
to some extent relationships are automatic
Free Riders
Divided Loyalty
American Airlines:AA advantage frequent-flyer program
Who Wins and Who Loses?
limiting supply
pros
may give you cachet
may provide free publicity
gets you a bigger slice of the pie
may lead customers to buy your slower-moving products while waiting for the shortage to end
cons
may cost you a relationship and thereby future sales
creates ill will
shrinks the pie-costs you sales today
leave a hole in the market, inviting entry
Added Value in a Competitive World
Trade-offs
Trans World Airlines(TWS)
before
TWA was bankruptcy
trade-off
remove 10~40℅ to have more legroom
the real cost is the lost of revenue of someone who would pay for that taken seat
after
win-win situation
TWS
customers sanctification soared
leg up on the competition
have the right to raise price
customers
have more legroom with lower price
other airlines
TWS won't start price war
Trade-ons
virtuous circle
first
your cost rise by more than the perceived quality improvement
then
more customers will come
finally
your cost might even lower than at the outset
Added value of a monopoly
"One strong company and the rest weak"
Power Play
Nintendo's inventory management policy
Hit the jackpot by developing Mario
Monthly magazine, Nintendo Power
Without Nintendo, No video-game
The antitrust Challenge
Investigate allegations
Several areas of concern
Security chip
Licensing agreements
The Virtuous Circle
The cheap hardware
Positive feedback loop
Severe shortages
Software was key
Monopoly Money
Without monopoly, no game
The ace of Diamonds
As for demand,more stable
Beyond supply and demand
One player owning the supply and being able to control it
Nintendo Power
Set in motion a virtuous circle
Famicom (Family Computer)
Home video game industry was back in business
Outboxed
Andy decided a big saving
Polymatic turned to its competitor
Loss of Computing Power
IBM's error
pursuing the outsourcing and open-architecture policies
Changing added value
Whether and How to limit the added values
have some added values of your own
improve quality at low incremental cost
relationship with customers and suppliers
with relationship
something unique
without relationship
commodity
Pumping profit
spaghetti test
antistrategy
