Building Customer Value, Satisfaction, Loyalty Flashcards
Modern Organization Chart = Customer-Driven Approach
Customer influences…
- frontline people
- middle management
- top management
Customer-perceived value (CPV) - Definition
The difference between the prospective customers’ evaluation of all the benefits and costs of an offering and the perceived alternatives.
- for choice processes
- for delivering high customer value
- for loyalty
Total customer benefit vs. total customer cost
Total Customer Benefit – Total Customer Cost = Customer Perceived Value
CVP - Total customer costs
- Energy cost
- Psychological cost
- Time cost
- Monetary cost
What influences the value perception of a product?
Ownership and possession
(if you don’t own a car, you think it is very special and valuable. As soon as you possess it, it “loses” it’s meaning to you.)
CVP - Total customer benefit
- prodcut benefit
- Services benefit
- Personnel benefit
- Image benefit
Customer Value Analysis - Steps
- Identify the major attributes and benefits that customers value
- Assess the quantitative importance of the different attributes and benefits
- Assess the company’s and competitors’ performances on the different customer values against their rated importance
- Examine how customers in a specific segment rate the company’s performance against a specific major competitor on an individual attribute or benefit basis
- Monitor customer values over time
CVA - Total customer satisfaction
A person’s feelings of pleasure or disappointment that result from comparing a product or service’s perceived performance (or outcome) to expectations
CVA - Monitoring satisfaction
Many companies are systematically measuring how well they treat customers, identifying the factors shaping satisfaction, and changing operations and marketing as a result
o Periodic surveys, customer loss rate, mystery shoppers, J. D. Power’s satisfaction ratings
CVA - Product and service 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
o Conformance quality vs. performance quality
o Impact of quality
Why you don’t use the word “quality” in marketing
Quality is highly relative and depends on individual view. It is not professional to use this description
Maximizing Customer Lifetime Value
Through customer profitability analysis in form of activity-based costing (ABC)
Customer-Product Profitability Analysis
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Customer Lifetime Value (CLV)
The net present value of the stream of future profits expected over the customer’s lifetime purchases
