Customer Focus and Managing Customer Loyalty Chapter One M arket-Based Management, 4 th edition

1-2 Customer Focus and Managing Customer Loyalty Chapter One Market orientation and customer focus The importance of customer satisfaction, retention, and loyalty Building a measure of customer loyalty Customer relationship management Marketing knowledge

1-3 Weak Customer Focus

1-4 Strong Customer Focus Insert figure 1.2 here

1-5 Customer Satisfaction Measuring Customer Satisfaction –Customer Satisfaction Index (CSI) Why is it important? –Directly correlated to profits –Leading indicator of operating performance Impact of Dissatisfied Customers

1-6 Why is customer retention important? –Cost of replacing/maintaining customers –Lifetime value of a customer How does a firm retain customers? –Encouraging complaints Customer Satisfaction and Retention

1-7 Measuring Customer Retention

1-8 Customer Loyalty Why is it important? –Customer Recommendations Measuring Customer Loyalty –Customer Loyalty Index (CLI)

1-9 Customer Relationship Management Why is CRM important? –Not all customers are desirable Goal of CRM –Build Customer Loyalty Classification of Customers –High Potentials –Top Performers –Non Profits –Underachievers New Customer vs. Win-Back Customer

1-10 Customer Relationship Management

1-11 Marketing Orientation Three Pillars of Marketing Orientation: Customer Focus Competitor Orientation Team Approach Three Drivers of Marketing Orientation: Marketing Knowledge Marketing Leadership Employee Satisfaction

1-12 Marketing Orientation and Marketing Knowledge

1-13 Marketing Excellence Survey

1-14 Takeaways / Review Customer Focus Market Orientation Customer Satisfaction Customer Retention Customer Loyalty Key Performance Metrics –Profit impacts of retention, exit, and satisfaction Customer Relationship Management (CRM) Marketing Knowledge Exercises –Marketing Performance Tools

1-15 Marketing Performance Tools Customer Satisfaction and Customer Profitability

1-16 Marketing Performance Tools Customer Retention and Customer Loyalty

1-17 Marketing Performance Tools Lifetime Value of a Customer