Shareholder Value: The Economic Times

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The word shareholder value is frequently used in the articles. The Economic Times gives a definition of shareholder value. It is the value delivered to shareholders by possessing shares of a company (The Economic Times(how to cite this source? In text/ reference)). Hiller (Hiller, Ross, Westerfield, Jaffe & Jordan, 2013) describes the shareholders value more precisely from a financial view. The shareholders equity is the remaining after the firm has paid its obligations. A firm owns two kinds of assets of short- and long terms. The main items of the short-term assets are cash and inventory, and the long-term assets are property, plant, and intangible property such as patent, trademarks, goodwill, brand equity and workforce. Contrary, the firm …show more content…

In Gruca and Rego’s article, it is said that traditionally, marketing activities elicit customer responses satisfying customers create an increasing loyalty, a receptivity to cross-selling and positive word-of-mouth advertising (Anderson,1996; Fornell, 1992; Fornel et al., 1996, as cited in Gruca & Rego, 2005). Firm enjoys such benefits of satisfied customers in the future when the customers come back to the next purchase and new customers are initiated the first purchase (Gruca & Rego, 2005). Srivatrava, Shervani and Fahey (1998; as cited in Gruca & Rego, 2005) studied a relationship between customer satisfaction and its impact on shareholder value. They state that the marketed-based assets such as loyalty and customer satisfaction create further value for customers, which generates improved performance in sales and market share. Therefore it results in an increase of shareholder value ultimately (Srivatrava et al.; as cited in Gruca & Rego, 2005). (Article …show more content…

They identify that the marketing phenomena exist in all core business processes of product development management, supply chain management and customer relationship management. Basically, the function of marketing is attracting and retaining customers (Srivastava et al., 1999). Marketing possesses the functions also as customer value creation and shareholder value creation (Day,1997; as cited in Srivastava, Shervani & Fahey, 1999). Moreover, marketing is an intellectual and operating discipline that influence whole business process to have each business process gets done. Hence marketing tasks have broad items of work. Even one of the business processes, for example, the customer relationship management includes a set of marketing tasks such as categorizing customer segment, understanding customer needs, advertising, promotion and offering service programs (Srivastava et al., 1999). (Article

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