Chapter One Customer Focus and Managing Customer Loyalty

Chapter One Customer Focus and Managing Customer Loyalty

Customer Focus and Managing Customer Loyalty • • Customer focus and profitability Profit impact of customer retention Managing customer loyalty Market-based management and customer focus Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -2

Weak Customer Focus Figure 1 -1 Underwhelming Customer and Shareholders Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -3

Underwhelming Customers Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -4

Strong Customer Focus Figure 1 -2 Customer Focus, Customer Satisfaction, and Profitability Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -5

(CSI) A Key Marketing Metric What if a company gets an average score of 72? Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -6

(CS) A wide Angle View 83% 17% Past Behavior Sales and mkt. share is backward looking! Future performance Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -7

De-Averaging (CS) & (CP) Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -8

Customer Satisfaction • Measuring Customer Satisfaction – Customer Satisfaction Index (CSI) • Why is it important? – Directly correlated to profits – Leading indicator of operating performance • Impact of Dissatisfied Customers Figure 1 -5 De-averaging Customer Satisfaction and Customer Profitability Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -9

De-Averaging (CS/CP) v. 1 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -10

(CS) And Retention v. 1 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -11

Dissatisfaction & Customer Exit Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -12

Customer Satisfaction and Retention Figure 1 -6 Customer Satisfaction, Complaint Behavior, and Customer Retention • Why is customer retention important? • How does a firm retain customers? Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -13

Measuring Customer Retention Figure 1 -10 Customer Life Expectancy and Customer Retention Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -14

Net Promoter Score Figure 1 -13 Net Promoter Score Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -15

Customer Loyalty • Why is it important? – Customer Recommendations • Measuring Customer Loyalty – Customer Loyalty Score (CLS) Figure 1 -14 Customer Loyalty Score Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -16

Managing Customer Loyalty Figure 1 -15 Managing Customer Loyalty Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -17

Customer Focus and Marketing Knowledge Figure 1 -17 Customer Focus and Marketing Knowledge Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -18

Market-Based Management Figure 1 -18 Market-Based Management Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -19

Market-Based Management and Customer Focus • Voice of the Customer • Customer Performance • Customer Leadership Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -20

Review • • Customer focus and profitability Profit impact of customer retention Managing customer loyalty Market-based management and customer focus Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1 -21

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