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Open Access
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 customers into…

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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. 38 no. 8
Type: Research Article
ISSN: 0265-671X

Keywords

Article
Publication date: 19 July 2021

Clotildo Padillo Jr, Noella Go, Pacco Manreal, Samuel Samson, Brian Galli, Kafferine Yamagishi, Michael Angelo Promentilla and Lanndon Ocampo

Despite the growing trend for single-dish restaurants in the Philippines, understanding customer loyalty for this subsector is scarce in the current literature. To address such a…

Abstract

Purpose

Despite the growing trend for single-dish restaurants in the Philippines, understanding customer loyalty for this subsector is scarce in the current literature. To address such a gap, this paper aims to identify attributes and their sub-attributes that contribute to customer loyalty for single-dish restaurants.

Design/methodology/approach

Using the analytic hierarchy process, the priorities of these attributes in achieving customer loyalty were generated from a group of expert decision-makers. A representative case study in the Philippines with an emerging market trend for single-dish restaurants was conducted.

Findings

Findings show that “value” is the most crucial attribute in achieving customer loyalty, followed by “food” and “service” attributes, which are straightforward implications of single-dish restaurants. More strikingly, the “atmosphere” attribute ranks last in the priority list, which may mean that customers consider fancy environments with less priority when dining in these types of restaurants. In the priority sub-attributes, “dining experience” and “tastiness” came up on top of the list, with the “music” attribute ranking last. These findings are crucial inputs to inform the design of strategies that would enhance the customer base.

Originality/value

This study reports the first attempt to rigorously analyze single-dish restaurants, which gain little attention in the current literature, yet an emerging type of restaurant, especially in developing economies. With significant differences in many aspects of mainstream restaurants, customer loyalty attributes may be different. This paper determines the list of priority attributes and sub-attributes of customer loyalty for Philippine single-dish restaurants. Identifying these priority attributes contributes to the extant literature by offering valuable insights for relevant decision-makers in gaining competitive advantage within their market niches.

Details

Journal of Modelling in Management, vol. 17 no. 4
Type: Research Article
ISSN: 1746-5664

Keywords

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 close…

7314

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

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

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 exploration of…

98

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

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 workforce …

62001

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

Article
Publication date: 27 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 and…

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

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 enables…

3264

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

Article
Publication date: 3 October 2016

Emma Hall, Wayne Binney and Julian Vieceli

Operatic events are an important sector of the performing arts industry and are currently facing the challenges of decreasing demand and price-based competition from other sectors…

1703

Abstract

Purpose

Operatic events are an important sector of the performing arts industry and are currently facing the challenges of decreasing demand and price-based competition from other sectors of the performing arts industry. It is posited that adding value and ensuring satisfaction may enhance consumer loyalty, and therefore, the likelihood of sales and continued subscriptions may be increased. The purpose of this paper is to examine bundling as a marketing management technique for opera companies and hypothesises that offering attractive “package deals” that bundle various benefits with the seat ticket may increase participation and loyalty.

Design/methodology/approach

A discrete choice experiment with opera patrons is used to evaluate the application of bundling to improve increased demand and loyalty.

Findings

It is concluded that offering bundles creates a greater likelihood of customer satisfaction and favourable behavioural intentions, which may lead to increased loyalty. Participants expressed strong support for value-added elements. Such package deals included a variety of elements: opportunity for a visit backstage to meet the cast, informative introductions to operas and facilitated parking options. Consumers’ level of overall willingness to purchase a bundle was altered based on the attributes that made up that bundle. The findings of this research confirm that the theory of bundling can be applied to arts marketing and provides support for the development of bundling strategies to enhance opera attendance.

Research limitations/implications

It is recognised that the research needs to be tested in different countries in order to know the extent to which the findings of this study can be generalised. Additionally, future research could use other statistical methods such as regression and structural equation modelling to holistically model behaviour. Finally, as well as testing customer-stated intentions, the model also needs to be tested with actual patronage behaviour following the development and application of bundling strategies. Future research could also consider how bundling and other aspects relating to opera attendance could be used as part of the branding strategy associated with opera attendance; in particular how to develop, increase and maintain loyalty and therefore brand resonance in opera attendees.

Practical implications

The findings have useful implications for event organisers and policymakers and suggest bundling strategies that could be utilised. It is has been found that loyalty can be enhanced by adding value and ensuring satisfaction, and therefore, increase the likelihood of sales and repeat purchase.

Social implications

Opera represents a significant cultural heritage and is a valuable component of the performing arts, both historically and currently. Opera is a form of art whose survival is threatened by an increasingly diminished audience whose average age is steadily increasing. This decrease in audience attendance has led to radical changes in the management and marketing of opera houses, where theaters have moved increasingly towards a business-oriented model where improved branding and bundling strategies can be utilised.

Originality/value

This makes a theoretical contribution by advancing performing arts research and furthering the notion that bundling can increase the likelihood of opera attendance, satisfaction, ongoing loyalty, and also addresses a managerial need of an arts marketing organisation.

Details

Arts and the Market, vol. 6 no. 2
Type: Research Article
ISSN: 2056-4945

Keywords

Article
Publication date: 1 October 2005

Andrew Banasiewicz

The paper aims to review and critique the current state of loyalty program planning and analytics, highlighting a number of process and methodological deficiencies.

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Abstract

Purpose

The paper aims to review and critique the current state of loyalty program planning and analytics, highlighting a number of process and methodological deficiencies.

Design/methodology/approach

A general loyalty program planning approach is outlined, designed to build a foundation for a profitable loyalty initiative.

Findings

The paper demonstrates the importance of robust customer insights to program planning and its ongoing management; it also challenges the accuracy of the conventional buyer loyalty measurement approach. In particular, the paper highlights the flaws of the dichotomous loyalty classification which makes often unreasonable category purchase requirements assumptions.

Originality/value

The alternative to the loyal customers vs brand switchers buyer categorization is offered, which allows customers to be single‐brand loyal, multi‐brand loyal or brand switchers. An explicit brand buyer loyalty categorization is presented, built around explicit differentiation between repurchase exclusivity and brand loyalty.

Details

Journal of Consumer Marketing, vol. 22 no. 6
Type: Research Article
ISSN: 0736-3761

Keywords

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