Lecture Marketing management: Chapter 5 - Phillip Kotler, Kevin Lane Keller

Phillip

Kevin Lane

Kotler • Keller
Marketing Management • 14e


a
h
C

5
r
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p

Creating Long-term Loyalty


Discussion Questions
1. What are customer value, satisfaction,
and loyalty, and how can companies
deliver them?
2. What is the lifetime value of customers,
and how can marketers maximize it?
3. How can companies attract and retain the
right customers and cultivate strong
customer relationships?
4. What are the pros and cons of database

marketing?
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Slide 3 of 34


Customer Value, Satisfaction, and
Loyalty
Holistic Marketing
ã Inform
ã Engage
ã Energize

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F .1
5

Traditional Organization vs.
Customer-Oriented
Organization

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Customer Perceived Value
Customerperceived
Value

Economi
c

Evaluating
Obtaining

Functiona
l

Using
Psychologic
al

Disposing
Total Customer
Benefit

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Total Customer
Cost

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F .2
5

Determinants
of Customer
Perceived
Value
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Customerperceived
value
Total
customer
benefit

Total
customer
cost

Product
benefit

Monetary
cost

Services
benefit

Time
cost

Personal
benefit

Energy
cost

Image
benefit

Psychological
cost
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Value Concepts - Caterpillar
Profit

Price

$6,00
0

Worth to
farmer:
$20,000

$20,00
0

Customer
Value
-0-

5,000 19,000

$1,000

4,000 18,000

2,000

3,000 17,000

3,000

2,000 16,000

4,000

1,000 15,000

5,000

-0- 14,000

6,000

Cost to produce:
$14,000
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Slide 8 of 34


Choice Processes and
Implications
Friends with
salesperson

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Lowest
purchase price
wins.

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d
e
in

f
e
D

Customer Loyalty

“A deeply held commitment to rebuy
or repatronize a preferred product or
service in the future despite
situational influences and marketing
efforts having the potential to cause
switching behavior.”
-- Oliver


Value Proposition
Volvo
Core positioning:
ã Safety

Other benefits:
ã Good performance
ã Design
ã Environmentally
friendly

Copyright â 2012 Pearson Education, Inc. Publishing as Prentice Hall

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d
e
in
f
e
D

Satisfaction
A person’s feelings of pleasure
or disappointment that result
from comparing a product’s
perceived performance to (or
outcome) to expectations.


Customer Satisfaction

Expectations

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Slide 13 of 34


Customer Expectations
Previous purchases
Friends
advice
Marketers’ / competitors

Expectation
s

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Slide 14 of 34


Monitoring Satisfaction
Influence of
Customer
Satisfaction

Measuremen
t
Techniques

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Customer
Complaint
s

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Measurement Techniques
Customer Loss
Rate
Surveys

Mystery Shopper
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Slide 16 of 34


Influence of Customer
Satisfaction

Customer
satisfaction

Speed of
communication

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Slide 17 of 34


Customer Complaints
5%

54% - 70%
Buy again if
resolved

95%

Complain

25%
Dissatisfi
ed

Tell 5
people

If resolved quickly

95%
Stop buying

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Tell 11
people

Slide 18 of 34


Product and Service Quality
Performance

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Conformance

Slide 19 of 34

Maximizing Customer Lifetime
Value

20% of
Customer
s

80% of
Profits

Customers
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Slide 20 of 34


Customer Profitability

Customer Profitability
Analysis
Profitable

Unprofitabl
e
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Customer Lifetime Value

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d
e
in
f
e
D

A Profitable Customer

A person, household, or company
that over time yields a revenue
stream exceeding by an acceptable
amount the company’s cost stream
for attracting, selling, and serving
that customer.


e
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F .3
5

Customer-Product
Profitability Analysis

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

Slide 23 of 34


Cultivating Customer
Relationships
Customer Information
ã Differentiate
ã Customize
ã Personalize
ã Share

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Slide 24 of 34


Customer Relationship Management
(CRM)

Personalizing
Marketing
Customer
Empowerment
Customer Reviews &
Recommendations
Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

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