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Article
Publication date: 2 December 2020

Peter Madzík and Arash Shahin

The purpose of this study is to present and explain a new customer segmentation approach inspired by failure mode and effect analysis (FMEA) which can help classify…

Abstract

Purpose

The purpose of this study is to present and explain a new customer segmentation approach inspired by failure mode and effect analysis (FMEA) which can help classify customers into more accurate segments.

Design/methodology/approach

The present study offers a look at the three most commonly used approaches to assessing customer loyalty:net promoter score, loyalty ladder and loyalty matrix. A survey on the quality of restaurant services compares the results of categorizing customers according to these three most frequently used approaches.

Findings

A new way of categorizing customers through loyalty priority number (LPN) is proposed. LPN was designed as a major segmentation criterion consisting of customer loyalty rate, frequency of purchase of products or services and value of purchases. Using the proposed approach allows to categorize customers into four more comprehensive groups: random, bronze, silver and gold – according to their loyalty and value to the organization.

Practical implications

Survey will bring a more accurate way of categorizing customers even in those sectors where transaction data are not available. More accurate customer categorization will enable organizations to use targeting tools more effectively and improve product positioning.

Originality/value

The most commonly used categorization approaches such as net promoter score, loyalty ladder or loyalty matrix offer relatively general information about customer groups. The present study combines the benefits of these approaches with the principles of FMEA. The case study not only made it possible to offer a view of the real application of the proposed approach but also made it possible to make a uniform comparison of the accuracy of customer categorization.

Details

International Journal of Quality & Reliability Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0265-671X

Keywords

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Book part
Publication date: 13 November 2017

Robert Kozielski, Michał Dziekoński, Jacek Pogorzelski and Grzegorz Urbanek

The term ‘strategy’ is one of the most frequently used terms in business, and its application in marketing is particularly common. Company strategy, market strategy…

Abstract

The term ‘strategy’ is one of the most frequently used terms in business, and its application in marketing is particularly common. Company strategy, market strategy, marketing strategy, sales strategy, promotion strategy, distribution strategy, low pricing strategy – it would take a long time to list all of them. Although this term is so commonly in use, its definition is not as straightforward and it can be interpreted in different ways. In comparison with tactical decisions, strategy is much more significant for an organisation as it brings long-lasting consequences. It is implemented by higher level managers on a regular basis, and it is based on external, often subjective information, so decisions – especially at the time they are made – are difficult to evaluate.

Taking into consideration the fact that strategy refers to a long-term rather than a short-term period, strategic decisions serve as the basis for undertaking operational activities. However, marketing refers to the market and the competition. It is possible to claim that marketing strategy is trying to find an answer to the question to which path an organisation should follow in order to achieve its goals and objectives. If, for example, a company has a goal to generate a profit of PLN 1 million by selling 100,000 pieces of a product, the market strategy should answer at least the following two questions:

  1. Who will be our target group, for example, who will purchase the 100,000 pieces of the product?

  2. Why is it us from whom a potential buyer should purchase the product?

Who will be our target group, for example, who will purchase the 100,000 pieces of the product?

Why is it us from whom a potential buyer should purchase the product?

The target market will be defined if a reply to the first question is provided. The second question identifies the foundations of competitive advantage. These two issues, that is, target market and competitive advantage are the strategic marketing issues. You cannot change your target group unexpectedly while competitive advantage is the basis for changing decisions regarding prices, promotions and sales.

This chapter describes the measures of marketing activities which refer to strategic aspects and testify a company’s market position – the measures of the performance of target groups and competitive advantage. Readers’ attention should be also focused on the indices that are less popular in Poland and, therefore, may be underestimated. It seems that some of them, for example, the index of marketing resources allocation and the marketing risk index, provide a lot of valuable information and, at the same time, make it possible to show the value of marketing investments. Their wider use in the near future is only a matter of time.

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Book part
Publication date: 30 July 2018

Abstract

Details

Marketing Management in Turkey
Type: Book
ISBN: 978-1-78714-558-0

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Article
Publication date: 2 August 2013

Lerzan Aksoy

This research aims to provide a synthesis of the normative prescriptions from the scientific literature as it relates to customer loyalty tracking and an evaluation of how…

Abstract

Purpose

This research aims to provide a synthesis of the normative prescriptions from the scientific literature as it relates to customer loyalty tracking and an evaluation of how close practice comes to these prescriptions. It offers a description of the landscape for how and why aspects of loyalty measurement and management converge and/or diverge.

Design/methodology/approach

Data is gathered through in‐depth telephone interviews with 92 senior level marketing managers across a variety of industries.

Findings

The overwhelming majority of firms view customer loyalty as a top strategic priority but only one in four has a formal definition of customer loyalty. Customer satisfaction and likelihood to recommend are the two most tracked measures. The findings also demonstrate that few firms are relatively sophisticated in their analytics capabilities and only half examine how loyalty influences business outcomes.

Research limitations/implications

The current study uses single respondent per firm.

Practical implications

The results provide compelling evidence that managers need to determine more consciously what customer loyalty means in the context of their business. Furthermore, firms could benefit from the use of more sophisticated and advanced modelling approaches which have the potential to uncover patterns in customer data and link with business results.

Originality/value

This is the first study in the scientific literature that investigates how close what managers are actually doing in practice comes to scientific prescriptions for tracking and engaging with customers in an effort to engender customer loyalty.

Details

Journal of Service Management, vol. 24 no. 4
Type: Research Article
ISSN: 1757-5818

Keywords

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Article
Publication date: 1 October 1997

David Pollitt

Prioritizing should be a company’s No. 1 virtue. In the absence of priority, companies flounder, and employees become distracted. This inevitably leads to missed…

Abstract

Prioritizing should be a company’s No. 1 virtue. In the absence of priority, companies flounder, and employees become distracted. This inevitably leads to missed deadlines, over‐extended budgets, and a resulting output different from what was originally intended. This is excruciatingly evident when implementing an information technology (IT) strategy. Few industries can compete with the heap of wasteful, incomplete, and underutilized projects IT has amassed over the past two decades. The core of the problem is not the technology, but a failure clearly to define priorities at all levels in a company.

Details

International Journal of Retail & Distribution Management, vol. 25 no. 10
Type: Research Article
ISSN: 0959-0552

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Article
Publication date: 1 June 1989

Chivas Regal

A new national survey has revealed that today's working Americans feel a marked change in priorities as the country heads into the century's final decade. In its…

Abstract

A new national survey has revealed that today's working Americans feel a marked change in priorities as the country heads into the century's final decade. In its exploration of American attitudes toward personal fulfilment, The Chivas Regal Report on Working Americans: Emerging Values for the 1990s find that the American workforce is placing less importance on financial success and more emphasis on family and community in its quest for personal happiness. The report is based on interviews with 1,001 working Americans, aged 25 to 49, who work full‐time outside the home. The interviews were conducted in October 1988 by Research & Forecasts Inc., and the report was commissioned by Chivas Regal, The House of Seagram.

Details

Management Research News, vol. 12 no. 6
Type: Research Article
ISSN: 0140-9174

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Book part
Publication date: 12 July 2006

Peter Schofield and Nicole Katics

Relationship marketing is widely accepted as the most successful way to build customer loyalty and competitive advantage in a mature, competitive market. The study…

Abstract

Relationship marketing is widely accepted as the most successful way to build customer loyalty and competitive advantage in a mature, competitive market. The study investigates customer loyalty programmes within the context of service quality in Swedish hotels using an online questionnaire survey. Five service quality factors were identified: technical, functional, environmental, technological convenience and technological product dimensions, which supports the Northern European service quality model with the addition of technological dimensions. Five loyalty programme factors were also established and factor scores were mainly undifferentiated on the basis of socio-demographic and behavioural variables. The implications of the results are discussed and recommendations for further research are made.

Details

Advances in Hospitality and Leisure
Type: Book
ISBN: 978-1-84950-396-9

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Article
Publication date: 18 November 2019

Maria Rybaczewska and Leigh Sparks

This paper aims to investigate place-based loyalty schemes and place marketing. It focuses on the practical issues of implementation and use as perceived by place managers…

Abstract

Purpose

This paper aims to investigate place-based loyalty schemes and place marketing. It focuses on the practical issues of implementation and use as perceived by place managers and businesses.

Design/methodology/approach

The investigation incorporated a three-stage procedure: focus group, quantitative data analysis and semi-structured interviews with place managers and business managers.

Findings

The study showed wide interest and potential for place based loyalty schemes, acknowledged by all stakeholder groups. The major concerns were practical issues such as complexity, security of data and costs of implementation (equally time/effort and money). The key finding is the need for simplicity to avoid competing desires and priorities.

Originality/value

Place marketing is claimed to be a priority for town and city managers. There is less agreement however on how to achieve effective place marketing. The authors show how different stakeholders have different views and how these need to be considered to obtain the benefits all agree are possible.

Details

Journal of Enterprising Communities: People and Places in the Global Economy, vol. 14 no. 1
Type: Research Article
ISSN: 1750-6204

Keywords

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Article
Publication date: 1 August 2002

Pawan Budhwar, Andy Crane, Annette Davies, Rick Delbridge, Tim Edwards, Mahmoud Ezzamel, Lloyd Harris, Emmanuel Ogbonna and Robyn Thomas

Wonders whether companies actually have employees best interests at heart across physical, mental and spiritual spheres. Posits that most organizations ignore their…

Abstract

Wonders whether companies actually have employees best interests at heart across physical, mental and spiritual spheres. Posits that most organizations ignore their workforce – not even, in many cases, describing workers as assets! Describes many studies to back up this claim in theis work based on the 2002 Employment Research Unit Annual Conference, in Cardiff, Wales.

Details

Management Research News, vol. 25 no. 8/9/10
Type: Research Article
ISSN: 0140-9174

Keywords

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Article
Publication date: 1 December 2003

Peter Koudal and Paul Wellener

Over the past two years, senior managers at several automotive companies have begun to implement a new business model called a digital loyalty network (DLN). The model…

Abstract

Over the past two years, senior managers at several automotive companies have begun to implement a new business model called a digital loyalty network (DLN). The model enables companies in any industry to continuously collect and monitor their customer, product and supply chain data and more precisely adjust engineering, production, distribution and sales/marketing activities to meet current and future demand. Moreover, they can use the same data to enhance their partnership with suppliers. For example, GM has put in place a number of components of a digital loyalty network, including the implementation of an integrated network connecting the company with suppliers, alliance partners, dealers and customers. GM has also adopted a new formula for managing the order‐to‐delivery process, has launched Web‐portals for customers and suppliers and continues to enhance and support its OnStar system, which allows drivers to communicate on the road with GM customer service representatives and vendors. Digital loyalty networks have three components: (1) Digital – the companies use sophisticated information technologies to manage information more effectively; (2) Loyalty – the system is designed to target, satisfy, and retain the most profitable customers and, in turn, use customer information and loyalty data to make the supply chain more efficient; (3) Networks – the information system links suppliers, producers and customers and is continuously updated. DLN companies use information technology resourcefully to increase the effectiveness of supply chain and customer relationship management initiatives. They develop a solid network of digitized information that ties together the value chain and creates loyalty and on both the front and back end of business operations. On the supply side, DLN companies continuously monitor customer value based on feedback about customer requirements, purchase history, and potential purchases and rely on digital technology to make certain their most valuable customers are kept satisfied. They do this by managing inventory through the supply chain so that the best customers are served first, and making certain short and long‐term capacity planning responds to these customer priorities. In addition to General Motors, Deloitte Research identified three other innovators in the automotive industry – Porsche, DaimlerChrysler and Renault/Nissan – that are developing certain aspects of a DLN.

Details

Strategy & Leadership, vol. 31 no. 6
Type: Research Article
ISSN: 1087-8572

Keywords

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