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    Kotler 05

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    Nafees Hasan Chowdhury
    The document discusses creating long-term customer loyalty and relationships. It provides frameworks for analyzing customer value and satisfaction, measuring lifetime customer value, cultivating strong customer relationships through retention and database marketing, and developing a customer relationship management (CRM) strategy. Key aspects of loyalty include reducing customer defection rates, increasing customer longevity, enhancing spending with existing customers, and focusing efforts on high-value customers.

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    Kotler 05

    Uploaded by

    Nafees Hasan Chowdhury
    72 views16 pages
    The document discusses creating long-term customer loyalty and relationships. It provides frameworks for analyzing customer value and satisfaction, measuring lifetime customer value, cultivating strong customer relationships through retention and database marketing, and developing a customer relationship management (CRM) strategy. Key aspects of loyalty include reducing customer defection rates, increasing customer longevity, enhancing spending with existing customers, and focusing efforts on high-value customers.

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    The document discusses creating long-term customer loyalty and relationships. It provides frameworks for analyzing customer value and satisfaction, measuring lifetime customer value, cultivating strong customer relationships through retention and database marketing, and developing a customer relationship management (CRM) strategy. Key aspects of loyalty include reducing customer defection rates, increasing customer longevity, enhancing spending with existing customers, and focusing efforts on high-value customers.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    72 views16 pages

    Kotler 05

    Uploaded by

    Nafees Hasan Chowdhury
    The document discusses creating long-term customer loyalty and relationships. It provides frameworks for analyzing customer value and satisfaction, measuring lifetime customer value, cultivating strong customer relationships through retention and database marketing, and developing a customer relationship management (CRM) strategy. Key aspects of loyalty include reducing customer defection rates, increasing customer longevity, enhancing spending with existing customers, and focusing efforts on high-value customers.

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    © All Rights Reserved
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    Download as ppt, pdf, or txt
    of 16

    5

    Creating Long-Term Loyalty


    Relationships

    Marketing Management, 15th ed


    Chapter Questions
    • What are customer value, satisfaction, and
    loyalty, and how can companies deliver
    them?
    • What is the lifetime value of customers?
    • How can companies cultivate strong
    customer relationships?
    • How can companies both attract and retain
    customers?
    • What is database marketing?
    Figure 5.1 Organizational Charts
    Figure 5.2 Determinants of
    Customer Perceived Value

    Total customer benefit Total customer cost

    Product benefit Monetary cost

    Services benefit Time cost

    Personnel benefit Energy cost

    Image benefit Psychological cost


    Steps in a Customer Value Analysis

    • Identify major attributes and benefits


    that customers value
    • Assess the qualitative importance of
    different attributes and benefits
    • Assess the company’s and competitor’s
    performances on the different customer
    values against rated importance
    • Examine ratings of specific segments
    • Monitor customer values over time
    Top Brands in Customer Loyalty

    • Avis • Land’s End


    • Google • Coors
    • L.L. Bean • Hyatt
    • Samsung (mobile • Marriott
    phones) • Verizon
    • Yahoo! • KeySpan Energy
    • Canon (office • Miller Genuine Draft
    copiers) • Amazon
    Measuring Satisfaction

    Periodic Surveys

    Customer Loss Rate

    Mystery Shoppers

    Monitor competitive performance


    What is Quality?

    Quality is the totality of features and


    characteristics of a product or
    service that bear on its
    ability to satisfy
    stated or implied needs.
    Maximizing Customer Lifetime Value

    Customer
    Profitability

    Customer Lifetime
    Equity Value
    Figure 5.3 The 150-20 Rule
    Figure 5.4 Customer-Product
    Profitability Analysis
    Framework for CRM

    Identify prospects and customers

    Differentiate customers by needs


    and value to company

    Interact to improve knowledge

    Customize for each customer


    CRM Strategies

    Reduce the rate of defection

    Increase longevity

    Enhance “share of wallet”

    Terminate low-profit customers

    Focus more effort on high-profit


    customers
    Customer Retention

    • Acquisition of customers can cost five times


    more than retaining current customers.
    • The average customer loses 10% of its
    customers each year.
    • A 5% reduction to the customer defection
    rate can increase profits by 25% to 85%.
    • The customer profit rate increases over the
    life of a retained customer.
    Figure 5.5 The Customer
    Development Process
    Suspects

    Prospects Disqualified

    First-time Repeat
    customers customers Clients Members

    Partners
    Ex-customers
    Using the Database

    To identify prospects

    To target offers

    To deepen loyalty

    To reactivate customers

    To avoid mistakes

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