Connecting With Customer
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Transcript of Connecting With Customer
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CREATING CUSTOMER VALUE ,
SATISFACTIONAND LOYALTY
MARKETING MANAGMENT
CHAPTER 5
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TYPES OF ORGANISTIONS
PROFIT CENTERED ORGANISATION
CUSTOMER CENTERED ORGANIZATION
Top
manage-
ment
Middlemanagement
Frontline people
CUSTOMERS
CUSTOMERS
Frontline people
Middle
management
Top
Manage-
ment
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BENEFITS OF CUSTOMER CENTERED
ORGANIZATION
CUSTOMER ADVOCACY STRATEGY.
COMPETITIVE ADVANTAGE.
CUSTOMER FEEDBACK.
when comp USA permitted on its site for online searchesit found that 20,000 more customer visited the site in a
month with a 50% greater propensity to buy.
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FACTORS AFFECTING CUSTOMER CHOICE
CUSTOMER PERCEIVED VALUE-
Difference between the prospective customers evaluation of all the benefits
and all the cost of an offering and the perceived alternatives.
TOTAL CUSTOMER BENEFIT-
Perceived monetary value of the bundle of economic , functional and
psychological benefits customer expect from a given market offering
because of the products, services , personnel and image involved
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FACTORS AFFECTING CUSTOMER CHOICE
TOTAL CUSTOMER COST-
perceived bundle of costs customer expects to incur in evaluating,obtaing, using
and disposing of the given market offering including monetary, time ,energy , and
psychological costs.
CUSTOMER PERCEIVED VALUE IS BASED ON THE
DIFFERENCE BETWEEN WHAT THE CUSTOMER GETS
AND WHAT HE/SHE GIVES FOR DIFFERENT POSSIBLECHOICES
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DETERMINANTS OF CUSTOMER-PERCEIVED VALUE
Customer-
Perceivedvalue
Total
Customer
benefit
Total
Customer
cost
Product
benefitMonetary
cost
Services
benefit
Time
cost
Personnel
benefit
Energy
cost
Imagebenefit
Psychologicalcost
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BENEFITS OF CUSTOMER VALUE ANALYSIS
Identify the major attributes and benefits that customer value.
Assess the quantitative importance of different attributes and benefits.
Assess the company s and competitors performances on different
customer values against their rated importance.
Examine how customers in specific segment rate the companys
performance against a specific major competitor on an individual
attribute basis.
Monitor customer value over time.
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REASONS FOR WRONG CHOICE BY CUSTOMER
Customer Ignorance.
Short Term Goal( profit maximization).
Budget Related Issues.
Effect of Competitors.
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CUSTOMER LOYALTY-DELIVERY OF HIGH
CUSTOMER VALUE
A DEEPLY HELD COMMITMENT TO
REBUY OR A PREFERRED PRODUCT OR
SERVICE IN THE FUTURE DESPITE
SITUTIONAL INFLUENCESANDMARKETING EFFORTS HAVING
POTENTIAL TO CAUSE SWITCHING
BEHAVIOUR- OLIVER
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TECHNIQUES USED FOR MAXIMIZING CUSTOMER
LOYALITY
The value proposition consists of the whole
cluster of benefits the company promises to
deliver.
It is more then core positioning of the
offering.
TECHNIQUES USED FOR MAXIMIZING CUSTOMER
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TECHNIQUES USED FOR MAXIMIZING CUSTOMER
LOYALITY
The value delivery system includes all the
experiencing the customer will have on the
way to obtaining and using the offering which
help to deliver distinctive consumer value.
Volvos core positioning has been safety but
it also includes long lasting car and goodservices.
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CUSTOMER SATISFACTION AND EXPECTATIONS
Customer satisfaction is the persons feelings
of pleasure or disappointment that result
from comparing a products performance to
their expectations.
Depends on many factors viz price ,loyality
relationship , accessibility and availability of
product and others.
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CUSTOMER SATISFACTION AND EXPECTATIONS
Customer satisfaction is derived when itfulfills customers expectations.
Expectations result from past buying
experience,advices and marketers andcompetitors information and promises
Korean automaker kia found success in us
by launching low cost,high quality cars withenough reliability so that it could offer 10 yearwarranties
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MEASUREMENT TECHNIQUES OF CUSTOMER
SATISFACTION
There are different methods of measuring
customer satisfaction
Periodic surveys-
Track customer satisfaction directly.
Through questionnaire.
To clarify about repurchase intention andrespondents willingness to recommend to
others .
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MEASUREMENT TECHNIQUES OF CUSTOMER
SATISFACTION
Customer loss rate technique-
Measure customers those who are switching
to other brands suupliers or either stopped
buying.
Mystery shoppers technique-
Act as potential buyers and report on strong
and weak points experinced in buying the
product
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FACTORS INFLUENCING CUSTOMER
SATISFACTION
Customer complaints-
A sense of cutomer satisfaction by tallying
complaints.
Studies shows that customers are
dissatisfied with their purchases about 25%
of the time but only 5% complains.
95% feel complaining is not worth the effort
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WAYS TO TACKLE CONSUMER COMPLAINTS
Set up 7-day,24-hourtoll-free hotline (byphone ,fax,email)to receive and act oncustomer complaints
Contact the complaining customer as soonas possible
Accept responsibility of dissatisfaction
Use people who are empathicResolve customer complains swiftly and to
customer satisfaction
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IMPACT OF PRODUCT AND SERVICE QUALITY
QUALITY IS TOTALITY OF FEATURES ANDCHARACTERISTICS OF A PRODUCT ORSERVICE THAT BEAR ON ITS ABILITY TOSATISFY STATED NEEDS.
-AMERICAN SOCIETY FOR QUALITYCONTROL
Northwest Airlines came to last of all top airlinesin BOYH ACS INDEX AND JD POWER AND
ASSOCIATES CUSTOMER SATISFACTIONPOLL due to its service quality.
QUALITY is the key to value creation andcustomer satisfaction.
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DUTIES UNDER QUALITY MANAGEMNT
Recognizing correctly customer needs andrequirement.
Communicate customer expectations to product
designers Timely disposal of customers order.
Check all the instructions and technicalassistance are provided to customers.
Check level of after sales service satisfaction.
Ask for customer feedback.
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CUSTOMER LIFETIME VALUE (CLV)
It consists of profitable consumer which is a
person household or company that over time
yields a revenue stream that exceeds the
acceptable amount which is spend bycompany for attracting , selling and servicing
that customer
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CUSTOMER PROFITABILITY ANALYSIS
Activity based costing.
Revenue from customers.
Including cost of all the resources thatultimately , serves customers.
Considers customers portfolio.
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DIAGRAM
C1 C2 C3
P1 + + + High Profitable
Prodcut
P2 + Profitable
ProductP3 ---- ---- Unprofitable
Prodcut
P4 ---- Highly
Unprofitable
ProductHigh Profit
Customer
Mixed bag
Customer
Losing
Customer
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CUSTOMER RELATIONSHIP MANAGEMENT
Process of carefully managing detailedinformation about individual customers andall customers touch point(it is any
occasions on which customers encounters abrand and product) to maximize custom andloyalty.
Enables companies to provide excellent raretype customers service through effective useof individual account information.
Forms a major driver of companies
profitability.
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ONE-TO-ONE MARKETING
Under CRM it is mainly used in rural sectorsand the features are listed below :-
Identify your prospects and customers.
Differentiate customers in terms of their needsand their value to your company.
Interact with individual customers to improveyour knowledge about their individual needs and
to build stronger relationships. Customize products , service and messages to
each customers.
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ATTRACTING AND RETAINING CUSTOMERS
Reducing the rate of customers defection:-
Increasing the longevity of the customerrelationship .
Enhancing the growth potential of eachcustomers through shares of wallet(gift andaccessories given free).
Making low profit customers more profitableor terminating them .
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RETENTION DYNAMICS
Potentials
Prospects
First-time
customers
Repeat
customers
Clients
Members
Advocates
Partners
Disqualified
prospects
Inactive or
Ex-customers
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BUILDING LOYALTY
Interacting with customers in CRM the companyused on going mechanism that gives managersplugged in to frontline customers feedback.
Developing loyalty programs :- Frequency programs:- Design to provide
rewards to customers who buy frequently and insubstantial amount.
Club membership program :- these clubs areresponsible for those customers who are thelargest portion of business.
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CUSTOMER DATABASE AND DATABASE
MARKETING
Customer database is the organize collection of
comprehensive information of individual
customers or prospects that is current
accessible and actionable for search marketingpurposes.
Database marketing is the process of building ,
maintaining and using customer data base andother database (products, suppliers etc.) to
contact , transact and building customer
relationships.
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DATAWARE HOUSE AND DATA MINING
These data are collected by the companys contactcentre and organized into a data ware house wheremarketers can capture , query and analyze it to drawinferences about an individual customers needs and
responses . By Data mining marketing statisticians can extract
useful information about an individual , trends andsegments from the mass of data . It uses
sophisticated statistical and mathematical techniquessuch as cluster analysis , automatic interactiondetection , predictive modeling and neural networking.
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USES OF DATABASE
To identify prospects
To decide which customers should receive a
particular offer
To deepen customer loyalty
To reactivate customer purchases
To avoid serious customer mistakes
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BY:-
Amir Suhail
Amit Singh
Amrit Singh
Amulya SharmaAnkit Kumar Singh
Ankit Verma
Ankit Yadav
Akash Agnihotri
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