differences between old market and new market
Answers
In the old Marketing Economy, companies organize themselves by way of product units. Thus a company may for instance set up a business unit to manage their washing machines, dryers, refrigerators and stoves. Though this makes sense, it makes more sense to also add marketing groups that address the needs of different customer groups such as households and building contractors who buy differently. This would mean a switch from being product-centered to being customer-segmented centered
The Old Marketing Economy also focuses on Profitable transactions other than customer lifetime value. Companies normally focus on individual transactions with the aim of making a profit on each transaction. New economy companies add a focus on estimating individual customer lifetime value and designing their market offerings and prices to make a profit over the customer's lifetime. New economy companies will sometimes underprice to gain new customers and be generous in its pricing and services to existing customers with an eye toward retaining them for the long run.
Mention can also be made of the Financial Scorecard focus of the Old Marketing Economy. Most senior managers in the old marketing economy will judge the company's performance by financial results as reflected on the profit and loss statement and the balance sheet. Top management in the new economy will however, in addition to the financial scorecard, examine the marketing scorecard to interpret what is happening to market share (not just sales revenue), customer loss rate, customer satisfaction, product quality relative to competitors, and other measures. They recognize that changes in marketing indicators predict changes in financial results. Modern day marketing should focus seriously on customer retention, and this implies giving great customer services. This is the because the new marketing economy has become such that it is very easy to lose customers and thus get out of business. The factors characterizing the new economy places lots of emphasis on the consumer. Consider what consumers have today that they didn't have yesterday:
1. A Substantial Increase in Buying Power: Buyers today are only a click away from comparing competitor prices and product attributes. They can get answers on the internet in a matter of seconds. They don't need to drive to stores, parks, wait on line and hold discussions with salespeople. They have the comfort of doing all that through the internet
2. A Greater Variety of Available Goods and Services: Today, a person can order almost anything over the internet: furniture, washing machines, Books, etc. Moreover buyers can order these goods from anywhere in the world which helps people living in countries with very limited local offerings to achieve great savings. It also means that buyers in countries with high prices can reduce their costs by ordering in countries with lower prices