1. CUSTOMER RELATIONSHIP MANAGEMENT
MARKET RELATING
CUSTOMER RELATIONSHIP MANAGEMENT

2. Satisfaction Theory
Satisfaction is determined by comparing expectations to performance
When P > E, there is positive disconfirmation, or satisfaction
When E > P, there is negative disconfirmation, or dissatisfaction
Managerial implication?
Satisfaction-dissatisfaction continuum

3. What else do we know about satisfaction?

4. What’s the answer?

5. Lifetime Customer Value
Multiply a customer’s expected # of visits times the average amount of money spent per visit.
Deduct costs of acquiring and servicing.
Add in value of accounts the customer refers to you.
Discount the sum appropriately for the time period being analyzed.

6. How LT Relationships Pay Off
Price Premium
Referrals
Cost Savings
Revenue Growth
Base Profit
Acquisition
Cost 1 2 3 4 5 6 7

7. Building Relationships
What are successful relationships built on?
What kind of relationship will be most beneficial to firms?

8. Relationship Spectrum
Transactional
exchanges
Value-adding
exchanges
Collaborative
exchanges

9. Levels on Which Relationships are Formed
Consumer-Product
Bonds
Consumer-Brand
Bonds
Consumer-Consumer
Bonds
Consumer-Firm
Bonds

10. Who Needs CRM? III IV Airlines Packaged Goods Mfrs Pharmacies
Computer Systems Cos.
differentiated
Uniform Highly
CUSTOMER VALUATIONS II I
Gas Stations
Bookstores
CUSTOMER NEED
Highly
differentiated
Uniform

11. Devising a Relationship Strategy
Create a database
of customer knowledge

12. Analyze reasons for loyalty
Create a database
of customer knowledge
Analyze reasons for loyalty
and defection

13. Analyze reasons for loyalty
Create a database
of customer knowledge
Analyze reasons for loyalty
and defection
Select customers to
attract and retain

14. Design and implement programs focused on customer retention
Create a database
of customer knowledge
Analyze reasons for defection
and loyalty
Select customers to
target and retain
Design and implement programs
focused on customer retention

15. Monitor performance for continuous improvement
Create a database
of customer knowledge
Analyze reasons for loyalty
and defection
Select customers to
target and retain
Design and implement program
focused on customer retention
Monitor performance for
continuous improvement