chapter 4 Flashcards
customer-perceived value (CPV)
the difference between the prospective customer’s evaluation of all the costs and benefits of an offering and the perceived alternatives.
total customer benefit
the perceived monetary value of the bundle of economic, functional, and psychological benefits customers expect from a given market offering because of the product, service, people, and image.
total customer cost
the perceived bundle of costs customers expect to incur in evaluating, obtaining, using, and disposing of the given market offering, including monetary, time, energy, and psychological costs.
loyalty
a deeply held commitment to rebuy or re-patronise a preferred product or service in the future despite situational influences and marketing efforts having the potential to cause switching behaviour.
value proposition
the whole cluster of benefits the company promises to deliver. it is more than the core positioning of the offer.
value delivery system
includes all the experiences the customer will have on the way to obtaining and using the offering.
satisfaction
a person’s feelings of pleasure or disappointment that result from comparing a product or service’s performance to expectations. it is key to customer retention. the company must try to deliver a high level subject to also delivering acceptable levels to other stakeholders, given its total resources.
quality
the totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs.
conformance quality
delivering promised quality.
performance quality
good characteristics.
the 80-20 rule
80 or more of the company’s profits come from the top 20 percent of its customers.
profitable customer
a person, household, or company that over time yields a revenue stream exceeding by an acceptable amount the company’s cost stream for attracting, selling, and serving that customer.
customer profitability analysis (CPA)
best conducted with the tools of an accounting technique called activity-based costing (ABC) and tries to identify the real costs associated with serving each customer, that is, the costs of products and services based on the resources they consume.
customer lifetime value (CLV)
the net present value of the stream of future profits expected over the customers’ lifetime purchases. for example, CLV provides a formal quantitative framework for planning customer investment and helps marketers adopt a long-term perspective.
customer relationship management (CRM)
the process of carefully managing detailed information about individual customers and all customers’ ‘touch points’ to maximise loyalty.
customer value management (CVM)
describes the company’s optimisation of the value of its customer base.
customer touch point
any occasion in which a customer encounters the brand and product, from actual experience to personal or mass communications to casual observation.
personalising marketing
about making sure the brand and its marketing are as personally relevant as possible to as many customers as possible - a challenge, given that no two customers are identical.
permission marketing
the practice of marketing to consumers only after gaining their expressed permission.
customer churn/defection
losing customers who switch three times a year to find the best deal.
marketing funnel
identifies the percentage of the potential target market at each stage in the decision process, from merely aware to highly loyal.
conversion rates
the percentage of customers at one stage who move to the next.
customer relationship capital
satisfied customers.
customer base
the number and value of customers who will do business with the new firm when it is sold.
frequency programs (FPs)
designed to reward customers who buy frequently and in substantial amounts.
club membership programs
attract and keep those customers responsible for the largest portion of business.
brand community
a specialised community of consumers and employees whose identification and activities focus on the brand. a strong brand community results in a more loyal, committed customer base. characteristics: 1. sense of connection to the brand/company/product/community members 2. shared rituals/stories/traditions that help convey meaning 3. shared responsibility to the community and individual members.
