Marketing Strategy and Competitive Positioning pdf ebook

Existing customer base
A major asset for many companies is their existing customer base. Particularly where a com-
pany is dealing with repeat business, in consumer and industrial markets, the existence of a 
core of satisfied customers can offer significant opportunities for further development. The 
development of the direct marketing industry (accounting for around half of all marketing 
expenditure in the USA) is symptomatic of this notion. Where customers are satisfied with 
previous company offerings, they are more likely to react positively to new offers. Hence, 
where (good) relationships exist with customers, these can be nurtured by managers to 
develop markets and serve as a barrier to competitive entry.
The converse is also true. Where a customer has been dissatisfied with a product or ser-
vice, they may not only be negative towards new offers, but also may act as ‘well poisoners’ 
in relating their experiences to other potential customers. There is an old marketing adage: 
‘Each satisfied customer will tell three others; each dissatisfied customer will tell 33!’ Of 
course, in the digital and social media world this is more like 33,000, thus compounding 
problems at an almost exponential rate.
The issue of customer retention and customer loyalty has become extremely important 
(and we will consider this in more detail in Chapter 14).
Technological skills
The type and level of technology employed by the organisation can be a further asset. Tech-
nological superiority can aid cost reduction and/or improve product quality. For example, 
the spectacular growth of a company such as Amersham plc (now part of GE Healthcare), 
a company focused on high-technology medical products, was largely based on its ability 
to stay ahead of competitors in terms of new product development, but also its capability 
of distributing highly toxic and radioactive substances safely throughout the world. In the 
automotive industry, German manufacturers BMW, Audi and Mercedes-Benz have positioned 

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themselves at the high-quality end of the market, through superior design, technical engineer-
ing excellence and comprehensive quality controls. The underlying ethos of this position was 
encapsulated in the famous Audi slogan ‘Vorsprung durch Technik’ (leading through technol-
ogy), emphasising the German/engineering heritage of the cars (country-of-origin effect).