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B2B Marketing

Marketing Innovation – Turning Bad Profits Good

One of the best marketing innovation trends is gaining a lot of steam among companies – turning a bad profit into a good one. Bad profits can destroy a company’s market share, give them a spotty reputation, and destroy customer loyalty and make it difficult to get new customers due to bad press.

Obviously, bad profits need to be avoided, and many corporations are beginning to see that only good profits will give them long-term revenue and growth trends.

Defining Marketing Terms

Where marketing innovation is concerned, bad profits are defined as the things done by companies to gain short-term profits, and wind up destroying the relationships with their customers. Examples of bad profits include unfair pricing strategies, cuts in customer service availability or outsourcing, and lowering a product’s quality while raising the price. This certainly leads to disgruntled customers who will eagerly jump ship to another company that does not participate in such tactics.

Good profits, then, from a marketing innovation standpoint, are those tactics that concentrate on ways to make the customer “delighted” with their product or service, so much so that the customer not only becomes loyal, but they bring in new customers by promoting their favored companies’ products and services. They almost literally become part of the marketing department – just because they love the service or product they receive for their money.

The benefits of good profit are threefold:

  • They are longer lasting due to customer retention.
  • They build the company’s reputation.
  • They can gain the benefit of the doubt during a price hike.

Typically, companies that rely on bad profits for their growth will be greatly disappointed to see a steady decline in revenue, and those who rely on good profits will be as delighted as their customers are to see growth and great increases in revenue and market share. The direct correlation is astounding, and makes this marketing innovation worth looking into.

The NPS Connection

This marketing innovation trend is a sound one. It can be easily measured by the NPS (Net Promoter Score) from surveys of existing customers, and easily adjusted by measuring the relevant feedback from consumers on a product or service.

Companies with a high NPS correlate with good profits, while those who correlate with bad profits have low NPS. From there, it’s easy to glean more feedback from consumers as to why they would not recommend a product or service, and make adjustments accordingly.

Use a simple, 10-point Likert scale and tally appropriately to determine consumer satisfaction. Work from that point forward to increase the NPS and get those bad profits to transform to good.

The marketing innovation of the NPS score to differentiate good profits from bad can help any company improve its growth potential. It is well worth the research required in terms of long-term growth and ROI.

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