Transcript Customer Satisfaction

Building Customer
Relationship
Customer Value
Total Customer
Value
(Product
,Services,
Personnel &
Image Value
Minus
Total Customer Cost
( Monetary ,Time ,
Energy & Psychic
Costs
Equals
Customer Delivered
Value
( Profit to the
Consumer
Customer Satisfaction
Customer Satisfaction with a purchase depends upon
product’s performance relative to buyer expectation.
Expectations are based on customer’s past experiences,
the opinions of friends & associates & marketer &
competitor information and promises
Dilemma of Expectation
Setting low expectations may not attract
enough buyers while too high expectations
may lead to buyer dissatisfaction
Measuring Satisfaction
Periodic surveys
 Customer loss rate
 Mystery shoppers

5-5
Framework for CRM
Identify prospects and customers
 Differentiate customers by needs and
value to company
 Interact to improve knowledge
 Customize for each customer

5-6
CRM Strategies
Reduce rate of defection
 Increase longevity
 Terminate low-profit customers
 Focus more effort on high-profit
customers

5-7
Reducing Customer Defection





Define and measure retention rate
Distinguish causes of customer attrition
Estimate profit loss associated with loss
of customers
Assess cost to reduce defection rate
Gather customer feedback
5-8
Levels of Relationship
Basic :
Salesperson sells but doesn’t follow up.
Reactive :
Salesperson sells & encourages customer to call
whenever required.
Accountable :
The sales person calls customer after sometime of
sale & ensures smooth running of product.
Levels of Relationship
Proactive :
The salesperson calls the customer from time to time with
suggestions about improvement in product
Partnership:
The company continuously works with customer & with
other customers to discover ways to deliver better value.
Steps in relationship
marketing Program
(a)
Identify the key customers meriting
management.
relationship
Choose the good customers & designate them for
relationship management.
(b) Assign a skilled Relationship Manager
Steps in relationship
marketing program
( c ) Develop a clear job description for
relationship managers:
Describe their reporting relationships , objectives
,responsibilities & evaluation criteria.
( d ) Have each relationship manager develop
annual & long range customer relationship
plans.
(e) Appoint an overall manager to
supervise the relationship managers.
Building Loyalty

Affinity programs:

A marketing effort sponsored by
an organization that solicits
responses from individuals who
share common interests and
activities
Frequent-buyer and Frequent-user
Programs


Frequency marketing: frequentbuyer or user marketing programs that
reward customers with cash, rebates,
merchandise, or other premiums
Can loyalty be built?
Long term contract is a better solution: like subscription
Tools That Aid Relationship
Marketing

Electronic Data Interchange (EDI)

Vendor Managed Inventory (VMI)

Database Marketing
Electronic Data Interchange
Electronic Data Interchange (EDI)
involves computer-to-computer
exchanges of invoices, orders, and
other business documents
 EDI is rapidly gaining popularity
because it allows firms to reduce their
cost and to improve their efficiency and
competitiveness

Vendor-Managed Inventory

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Vendor-Managed Inventory
(VMI): is an inventory-management
system in which the seller–based on
existing agreement with a buyer–
determines how much of a product is
needed
New supplies are then automatically
shipped to the buyer