3. Who is the customer?

Question 1

What are the characteristic segments of a private individual?

Answer 1

1. Demographics; age, gender, cultural background, income & occupation.
2. Motivational factors; why does the consumer want to buy the product? E.G car insurance, mandatory.
3. Usage; based on frequency they use a product. E.G usage of claims, multiple claimant has different expectations to one who has never made a claim.
4. Vulnerable customers; FCA identified into groups; old, young ,mentally ill, low numeracy & literacy skill. - Careful as broad - not all are vulnerable.

Question 2

What are the segments of a business?

Answer 2

Size, most important & frequently used to break down the segments of a business.

1. Sole proprietors, microbusiness (no more than two employees) & small businesses behave in similar way to private individuals in terms of decision making & expectations.
2. Large firms; more likely to have insurance and/or risk manager who are knowledgeable about insurance & expect claims to be managed in professional & business like manner.

Question 3

Why has care to be exercised when using term small business?

Answer 3

Has different definitions in terms of the size of the business

Question 4

How does companies house define small business and medium business?

Answer 4

• Small < 50 people
• Medium < 250 employees

Question 5

What are groups more frequently recognised as?

Answer 5

• B2B context
• Because firm typically has many people involved in decision of purchase.
• Typically through a hierarchical reporting line
• B2C can be used as not all individual, partners family etc.

Question 6

What is B2B

Answer 6

Business to business

Question 7

What is B2C

Answer 7

Business to consumer

Question 8

Why are employees of the firm important?

Answer 8

1. Often overlooked
2. Poor internal service = poor external service to customers

Question 9

What did Karl Albrecht write about the importance of the internal customer? (5)

Answer 9

1. Identify & prioritise your internal customer
2. Identify their needs
3. Identify which needs are most crucial
4. Verify 2 & 3, amend if necessary
5. Conduct research to measure performance

Question 10

Who are the other stakeholders? (8)

Answer 10

• Anyone with interest or concern in a company.
  EG:
• Government
• Professional bodies
• Shareholders
• Suppliers
• Unions
• Communities
• Customers