BUILDING CUSTOMER SATISFACTION, VALUE RETENTION

(1)

BUILDING

CUSTOMER

SATISFACTION,

VALUE &

RETENTION

(2)

SCOPE

A. CUSTOMER



CUSTOMER VALUE



CUSTOMER SATISFACTION



CUSTOMER LOYALTY



CUSTOMER LIFETIME VALUE



CUSTOMER EQUITY



_{CUSTOMER PRODUCT PROFITABILITY}



CUSTOMER RELATIONSHIP MANAGEMENT

(3)

B. CUSTOMER & BUSINESS MARKET



INFLUENCING MARKET



BUYING PROCESS



BUYING DECISION

(4)

Costumer Value

Value is a consumer

perception that after comparing the cost and price

with benefits that are received. If the consumer rate

product (brand) used to meet the needs and provide benefits

(5)

(6)

Costumer Satisfaction



Satisfaction is a person’s feelings of pleasure or

disappointment resulting from comparing a product’s

perceived

performance (

or outcome

) in relation to

(7)

Tools for measuring

Customers satisfaction

 Complaints and suggestions systems

 Customers satisfaction surveys

 Ghost shopping

(8)

Highly Satisfied Customers

• Stays Buyer Longer

• Buys More

• Talks Favorably about Products

• Offers Ideas

(9)

COSTUMER NEEDS

• Factors related to the product - Quality Products

- Product form - Reliability

Factors associated with the service - Warranties

- Response and how to solve

Factors associated with the purchase of - Employee Experience

(10)

(11)

Value equity: What the customer assesses the value of the product or service provided by the company to be;

Brand equity: What the customer assesses

the value of the brand is, above its objective value;

Retention equity: The tendency of the

customer to stick with the brand even when it is priced higher than an otherwise equal

product;

There are

three drivers (factors)

(12)

Profitability &

Quality concepts

 A

profitable customer

is a person,household or company that over time yields a revenue stream that exceeds by an acceptable amount the company’s cost stream of attracting, selling and servicing that customer

(13)

• INFLUENCING FACTORS

• BUYING PROCESS

• BUYING DECISION

(14)

- To make other goods and services

- To resell to other business users or to consumers

- To conduct the organization’s operations

The business market consists of all individuals and organizations that buy goods and services for one or more of the following purposes:

(15)

A. Multiple Buying Influences – the Buying Center

(16)

(17)

(18)

What results are you looking for?

• Define measurement of market potential • Determination of market characteristics • Market share analysis

• Sales analysis • Business trends

Refine opportunities to pursue and “how”

• Market segmentation and niche markets

• Features and benefits required for market success

(19)

(20)

(21)

(22)

(23)

(24)

Customer Relationships Management

*Customer Relationship Management is the

establishment, development, maintenance and

optimization of long-term mutually valuable

relationships between consumers and

(25)

Why do Market Research

 Knowledge is King

 Learn from others…you will have plenty of your own lessons

 Find “strategic” competitive advantages

 What are your barriers of entry? What are the competitors?

 Develop competitive differential opportunities

 Why are you better? How can you be the best?

 Understanding of core competencies and core rigidities

 Develop pricing models

 Targeted alliances/partnerships that extend reach

 Create the product roadmap

 Features, benefits to fit customer/consumer need

 Support the creation of the company/product/service vision

 Feed the machine with information

(26)

Market Research is

the Critical component

to any business plan



Know the self



Know the customer



Know the market



Know the industry



Know the government

(27)

Types of market research

 Exploratory research

 Review of literature (pubs, online, mags)

 Discussion with experts, officials, friends and family

 Study of competitors or case studies in similar industries

 Descriptive research

 Targeted at specific question or hypothesis

 Surveys/questionnaires

 random sample from a relevant population  Focus groups

 Industry or product specific (usually expensive)

 Use your network! As a student…ask for help from a

targeted CEO

 Experimental research

 Looking for cause and effect (i.e. pharma research)

 Watching a user group “use” the product

(28)

Targeted research topics and why?



Advertising research

 Motivation research

 Ad effectiveness



Business Economics and

Corporate research

 Forecasting

 Business Trends

 Pricing studies

 Acquisition/merger research



Product research

 Product acceptance or potential

 Competitive product studies

 Testing of existing products

 Packaging design, etc.



Sales and Market

research

 Market potential

 Market share analysis

 Market characteristics

 Sales Analysis

 Distribution sales channel studies

 Test marketing/focus groups

 Promotional research and studies



Financial research

(29)

Competitive research

 Direct competition – important

 Indirect competition – critically important

 What to look for..

 Map their strategy

 Differentiate your offering

 Find pricing advantages

 Develop barriers to entry

 How to fill the “whole” need for

customer/consumer

 Financial stability

 Market share and focus on new markets

(30)

Short term advantages



Refined tactics for customer reach



Measurement of market potential



Market characteristics



Market share



_{New product acceptance}



_{Produce evaluation}

Improvements

(31)

Long range advantages



Planning, goal setting, developing strategies



Understanding business trends



Global market opportunities



Forecasting growth



_{Management uses MR to reduce errors in decision}

marketing, expand sales and locate new

opportunities



_{Uninformed decisions can be failures}

(32)

Primary Market Research

 Surveys

 Telephone, mail, in-person, (email)

 Focus groups

 Random sampling of population

 Scientific approach for primary market research

 Define the problem

 Don’t confuse problems w/a symptom

 Analyze the situation

 What do you already have and what do you need  Use secondary data

 Refine the “specific problem”

(33)

Secondary Market research tools

 The internet

 Competitive research

 White papers

 Press releases (statistics”  Industry tradeshows

 School databases

 Industry analysts

 Gartner Group

 IDS

 Internal records (sales, etc)

 Libraries

 Government

 SIC codes/Industry codes

 Demographics

 Commercial firms (competitors, partners, “like” companies)

 Press releases, conferences, tradeshows

(34)

Decisions driven by market research



Overall company vision



Product or service positioning



Product or service innovations/extensions



Investment in marketing at segments of market

Understanding of potential distribution channels



Branding



Credibility

(35)

Bibliography

 Berger, Paul D. and Nada I. Nasr (1998), "Customer lifetime value: Marketing models and applications," Journal of Interactive Marketing, 12 (1), 17 - 30

 Department of marketing & Decision sciences, San Jose State University, presentation Part 22-Identifying and Selecting Markets

 Pfeifer, Phillip E., Haskins, Mark E., and Conroy, Robert M. (2005), "Customer Lifetime Value,

Customer Profitability, and the Treatment of Acquisition Spending," Journal of Managerial Issues, 17 (1), 11-25

 Rust, Roland T.; Lemon, Katherine N.; Zeithaml, Valarie A.: Return on Marketing: Using Customer Equity to Focus Marketing Strategy, Journal of Marketing 68(1), 2004, 109-127