Creating Competitive Advantages Through New Value Creation: A Reverse Logistics Perspective

Jayaraman, Vaidyanathan; Yadong Luo
May 2007
Academy of Management Perspectives;May2007, Vol. 21 Issue 2, p56
Academic Journal
Conventional wisdom in value chain strategy assumes a one-directional flow of primary activities, starting from inbound logistics to operations, outbound logistics, marketing and sales, and finally to service. Our recent study, extensive discussions with executives, and on-site visits suggest that this wisdom may not be complete for certain industries or products. Customers on average return about 6% of everything they buy. Companies need to view this as an opportunity to give this returns pile a new lease of life. Yet many companies are not used to thinking that the things they expel such as products, waste, and resources actually have value. In fact, few retailers and suppliers capture the wealth of information that is locked inside a box that has been returned to the warehouse. Elevating the returns process to a new marketing opportunity builds a loyal customer base and also attracts new ones. In this paper, we present a redefined value chain strategy that entails a closed-loop system for industries in which reverse chain activities (reuse, repair, refurbishing, recycling, remanufacturing, or redesign of returned products from the end user) may create additional competitive advantages for the firm. Firms that do not recognize the importance of an effective reverse logistics strategy as part of their value chain risk damaging customer relations and may seriously jeopardize their brand image and reputation. A good reverse logistics program can be a differentiator and provides a means of gaining market advantage. In our perspective, a redefined value chain should be a part of the overall business strategy for manufacturers or retailers who handle product returns.


Related Articles

  • Time to check in with your customers. Behe, Bidget // GMPRO - Greenhouse Management & Production;Nov2009, Vol. 29 Issue 11, p28 

    The article offers helpful pointers in reconnecting with customers to increase sales and hurdle the challenge of the economic times. Five categories of customers and how to deal with them to increase sales and profitability include the champions, the solid customers and the emerging customers....

  • "Heart Appeal" in Grocery Advertising. Lunding, Franklin J. // Journal of Marketing;Oct59, Vol. 24 Issue 2, p74 

    It is difficult, particularly in mass retailing, to convince shoppers to open their pocketbooks and make their purchases from displays. This article discusses what can be done in advertising to attract and build steady customers.

  • Three seconds to market your message to prospect. Murtagh, Joe // Hudson Valley Business Journal;11/28/2005, Vol. 16 Issue 23, p21 

    In this article, the author offers tips for successful and result-oriented marketing. With the development in information technology, the people have become less patient with marketing. The author views that only by answering the four questions customers always ask can one's organization make...

  • Address negative image issues as a priority. Lamons, Bob // Marketing News;4/15/2004, Vol. 38 Issue 7, p7 

    Emphasizes the importance of brand imaging in businesses. Association between brand images and customer expectations; Ways for companies in addressing the negative image of the company; Need for companies to have a realistic mission statement.

  • Being Rational on Emotional Benefits. Babej, Marc // Brandweek;10/3/2005, Vol. 46 Issue 35, p16 

    Presents insights on the importance of expressing emotional connection with consumers to product marketing. Metaphorical implications of emotional benefits; Background on the Orthodox branding's categorical demand for emotional connection; Factors to consider in achieving marketing success.

  • WHO ARE THESE PEOPLE? SHOULD I CARE? Goree, Mike // Marketing Management Association Annual Conference Proceedings;2009, p8 

    The underlying assumption of this presentation is that we as a profession espouse the uber-concept of "relationship marketing" in almost all of our classes. What we say may take different turns, but I bet we all say something about customer satisfaction being better when there is a relationship...

  • MODELLING OF THE PROCESS FOR PROVIDING SATISFACTION OF CUSTOMER REQUIREMENTS. Bešic, Cariša; Đorđević, Dejan; Ćoćkalo, Dragan // TTEM- Technics Technologies Education Management;Sep2009, Vol. 4 Issue 2, p144 

    Success of a company depends on understanding the needs of the market and on harmonizing the company's possibilities with market's needs and requirements. Modern business environment is dynamic and characterized by frequent changes. In such conditions, the understanding of market's requirements,...

  • When everyone is good, you need a new strategy. Paley, Norton // Marketing News;4/29/1991, Vol. 25 Issue 9, p12 

    This article presents a marketing strategy to get closer to customers. Make clients the center of all activity. Identify the problems of a customer and provide solutions. Help them to achieve their goals. Define consumer markets according to age, sex, income, education and profession. Carry out...

  • EXPERIENTIAL MARKETING. Gamage, Ken // Marketing (00253650);Oct2014 Supplement Media Digest, p62 

    The article focuses on experiential marketing which gives consumers the freedom to make their own judgments about the product or service. Topics discussed include the common forms of experiential marketing, setting the goals for the said marketing strategy, and the challenges on measuring the...


Read the Article


Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics