Building Customer Value, Satisfaction, and Loyalty

Successful are those who carefully manage their

customer base.

Traditional Vs. Modern

Customer

Frontline people

Customer

Frontline people

Middle managers

Middle managers

Top Manager

Top Manager

Managers who

believe are

profit centers

Managers at every

level tends to the

need

tend to be value maximizers, seeking superior alternatives

tend to be value maximizers, seeking superior alternatives

–

tend to be value maximizers, seeking superior alternatives

Customer-perceived value

–

tend to be value maximizers, seeking superior alternatives

Customer-perceived value

–

Raise by

Or

Total customer cost alsoinclude :

• Time

• Energy

• Psychological costs

• Usage

• Maintenance

• Disposal

• Ownership

• Product acquisition etc…

“ The real cost of anything is the toil and trouble of

acquiring it “ - Adam Smith

Total customer cost alsoinclude :

• Time

• Energy

• Psychological costs

• Usage

• Maintenance

• Disposal

• Ownership

• Product acquisition etc…

Mangers often conduct customer value analysis

Reveals the strengths and

weakness compared to Competitors

• Identify attributes customer value

• Assess the importance of different value

• Assess the company and competitor’s performance

• Examine how customer rates performance against competitor

• Monitor customer value

• Identify attributes customer value

• Assess the importance of different value

• Assess the company and competitor’s performance

• Examine how customer rates performance against competitor

• Monitor customer value

* Buyers operate under various constraints and analysis may fail !

Consumers have various levels of Loyalty…

“ Loyalty is a deeply held commitment to or a preferred product

or service in the future despite situational influences and marketing efforts having

potential to causes switching behavior. “- Oliver

Satisfaction is pleasureor disappointmentresulting from comparing product CPV to expectation

Investing more on customer Satisfaction,diverts fund from stakeholders, leaving them unhappy.

Satisfaction = Loyalty !Customer satisfaction is also linked to higher profits

Periodic surveys can track customer satisfaction…

Companies can hire “mystery shoppers”, who report on the strong and weak point in buying their product in market

Companies need to keep a check on the customer satisfaction…

Internet provides a means to share both bad and good word of mouth to the rest

of the world.

Interesting numbers:

25 would be dissatisfied

But only 1-2 complain

95 believe complaining is not worth the effort

The people who complain return back to be loyal customers, if complaint is

resolved quickly …

Out of 100 customers.

• Set up 24/7 toll-free hotline

• Resolve issues of the complaining customer

quickly

• Accept responsibility for customer’s

disappointment

• Use frontline people who are empathic

• Resolve complaints to customer’s satisfaction

Customer point of view :

Quality is the totality

of features of a

product or service

that bears on its

ability to satisfy

stated needs

Special thanks

• https://www.flickr.com/photos/danielygo/• https://www.flickr.com/photos/kimberlynmerrill/• https://www.flickr.com/photos/griddlecakes/• https://www.flickr.com/photos/darwinbell/• https://www.flickr.com/photos/whyld/• https://www.flickr.com/photos/59937401@N07/• https://www.flickr.com/photos/jurgenappelo/• https://www.flickr.com/photos/jvk/• https://www.flickr.com/photos/61278574@N06/

Thank you!

Created by :

Ashwin SasikumarGovt. Model Engineering College, Kochi

Prof. Sameer Mathur

IIM Lucknow

www.IIMinternship.com

During an internship under :