Customer Service and Marketing

Customer service is often viewed as the primary interface between logistics and marketing. Discuss the nature of this interface and how it might be changing. You can use your own company or one you know of as an example.

book supply chain management: A logistics perspective, 11th edition By: Langley, C. John/Novack, Robert A./ Gibson, Brian for referencing. 

Deno Peer review 1

Traditionally, customer service is the direct link between logistics and marketing. This is because customer service encompasses the support a customer has throughout the buying process. The buying process starts before a purchase is made and lasts long after the customer has purchased the item. Customer services can include information about the product, its delivery, and even its return/ replacement down the road. Although marketing can sell a product, and customer service can walk a customer through the process, it is up to logistics to make sure the product ends up in the hands of the customer. "As much as 60% of desirable customer service attributes can be directly attributed to logistics (Innis & LaLonde, 1994). These include fill rates, frequency of delivery, and supply chain visibility (Innis & LaLonde, 1994). Researchers have consistently discovered that customer service is highly dependent on logistics." (Sarder 2020)

In the 4P's of Marketing, "Place" is completely reliant on logistics. It represents how to customer will get the product, which is a primary goal of logistics. Because of this relationship, Customer Service is the primary interface between the two. "This relationship manifests itself in this perspective through the “place” dimension of the marketing mix, which is often used synonymously with channel-of-distribution decisions and the associated customer service levels provided."(Coyle 2018)

In recent years the relationship between marketing and logistics has become even more intertwined. Marketers have discovered the importance of fast delivery and consumers are beginning to expect fast delivery. In order to accommodate fast delivery, marketers must be more understanding of logistics than ever before. This trend can be reflected in customer service with the question of. "When is my package going to arrive" Becoming one of the most asked questions in customer service. Additionally, people have higher expectations of customer service and tend to reward higher quality customer service with brand loyalty which can lead to upwards of a 66% increase in business. (Andrea, 2020)

references

Coyle, C., Langley, J., Novack, R., & Gibson, B. (n.d.). Supply chain management 10th edition (10th ed., Vol. 1).

Sarder, M. (2021a). Logistics customer services. Logistics Transportation Systems, 197–217. https://doi.org/10.1016/B978-0-12-815974-3.00008-3

Sarder, M. (2021b). Logistics customer services. Logistics Transportation Systems, 197–217. https://doi.org/10.1016/B978-0-12-815974-3.00008-3

What do customers want? – 37 customer service statistics. (n.d.). SmallBizGenius. Retrieved 9 February 2022, from https://www.smallbizgenius.net/by-the-numbers/customer-service-statistics/

Kat Peer review 2

Customer service is the driving force between logistics and marketing. Companies need to anticipate the wants and needs of consumers to market effectively. The finished product and customer service are the foundation when planning logistics for the company. For example, make-to-stock (MTS) products can be produced in vast quantities, but the possibility of quality could potentially suffer, resulting in negative customer experience. According to Langley et. al. (2021) “One should not forget that while MTS may be cheaper from a total cost of manufacturing standpoint, the method may sacrifice customer service, responsiveness, and variety.” Logistics and marketing have evolved from a mass production system of like MTS to a pull system involving customization in products. This changes the way companies developed, produce and stock products. According to Langley et. al (2021), “Many organizations have advanced from forecast-driven production strategies to demand-driven approaches. These companies strive to be lean, flexible, or adaptive; wait for customers to pull products to the market; and rely on much smaller stockpiles of inventory.” (p178). Take the hair care company Prose’ for example. Prose’ is a fully customizable hair care line that allows its consumers to enter specific information regarding their hair type, hair needs and hair desires. This customization is demanded by the consumer and pulled from the company. The company operates by a “no one size fits all” approach which is tailored to the consumers.

references

Jr, L. C. J., Novack, R. A., Gibson, B. J., & Coyle, J. J. (2021). Supply Chain Management: A logistics perspective. Cengage

Abigayle peer review 3

Customer service has an important role as the interface between logistics and marketing. A business’s reputation can be harmed “If the logistics system, particularly outbound logistics, is not functioning properly and a customer does not receive a delivery as promised, the organization could lose both current and future revenue” (Coyle et al., 2016, p. 251). The nature of the interface between logistics and marketing is changing as “logistics today is taking on a more dynamic role in influencing customer service levels as well as in impacting an organization’s financial position” (Coyle et al., 2016, p. 251).

Walmart is one company that has “used logistics and customer service to reduce product prices, increase product availability, and reduce lead times to customers” (Coyle et al., 2016, p. 251). They have focused on increasing fulfillment capacity, supply chain automation, and technology, which have allowed them to expand ecommerce while reducing shipping time and cost (Banker, 2021). They have also implemented an “Omnichannel” strategy, which they define “as a customer-centric experience that seamlessly integrates ecommerce and retail stores into an offering that saves time for consumer” (Banker, 2021). This omnichannel approach has benefited both the customer and Walmart as “their digital transformation – spending on ecommerce and supply chain technologies, combined with new investments in supply chain infrastructure – represented 72% of their strategic capital expenditure in the US for their 2020 and 2021 fiscal years” (Banker, 2021).

References

Banker, S. (2021, April 23). Walmart’s Massive Investment In A Supply Chain Transformation. Forbes. https://www.forbes.com/sites/stevebanker/2021/04/23/walmarts-massive-investment-in-a-supply-chain-transformation/?sh=50f8a6b4340e

Coyle, J. J., Langley, J. C., Novack, R. A., & Gibson, B. (2016). Supply Chain Management: A Logistics Perspective (10th ed.) [E-book]. Cengage Learning.