Chapter 1 Consumer Behavior Part 2
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Customer Value , Satisfaction, Trust & Retention The Impact of New Technology on Marketing A Simplified Model of Consumer Decision Making Successful Relationships , Customer Profitability-Focused Marketing
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Chapter 1 Consumer Behavior Part 2
- 1. Consumer Behavior, Ninth Edition Schiffman & Kanuk Session 2 Consumer Behavior Prepared By Prof. Nishant Agrawal
- 2. Session Outline • Customer Value , Satisfaction, Trust & Retention • The Impact of New Technology on Marketing • A Simplified Model of Consumer Decision Making
- 4. Successful Relationships • Customer Value • Customer Satisfaction • Customer Retention • Defined as the ratio between the customer’s perceived benefits (economic & functional) & the resources (time, effort) used to obtain those benefits • Perceived value is relative & subjective • Developing a value proposition is critical. Ex. Hotel Value, Satisfaction, and Retention
- 5. Discussion Question • How does McDonald’s create value for the consumer? Ex. Apple • How do they communicate this value?
- 6. Successful Relationships • Customer Value • Customer Satisfaction • Customer Retention • The individual's perception of the performance of the product or service in relation to his or her expectations. • Customer whose experience fall down below expectation will be dissatisfied. Vice versa ( Ex. Cold fries served at McD ) Value, Satisfaction, and Retention
- 7. Successful Relationships • Customer Value • Customer Satisfaction • Customer Retention • The objective of providing value is to retain highly satisfied customers. • Loyal customers are key They buy more products They are less price sensitive They pay less attention to competitors’ advertising Servicing them is cheaper They spread positive word of mouth Value, Satisfaction, and Retention
- 8. Customer Profitability-Focused Marketing Tier 1: Platinum Tier 2: Gold Tier 3: Iron Tier 4: Lead
- 9. Customer Pyramid Platinum • Customers who are not price sensitive • Who are willing to try new offering Gold • Customers who are more price sensitive • Ask for discount, likely to buy from several providers Iron • Customer who do not merit special treatment Lead • Customer who cost the company because they claim more attention & Spread negative word of mouth
- 10. Traditional Marketing Concept Vs. Value and Retention Focused Marketing Traditional Marketing Concept Value and Retention Focused Marketing Make only what you can sell instead of trying to sell what you make Use technology that enables customers to customize what you make Do not focus on the product; focus on the need that it satisfies Focus on the product’s perceived value, as well as the need that it satisfies Market products and services that match customers’ needs better than competitors’ offerings Utilize an understanding of customer needs to develop offerings that customers perceive as more valuable than competitors’ offerings
- 11. Impact of Digital / New Technologies • Consumers have more power than ever before • Consumers have more power and access to information • Marketers can gather more information about consumers • The exchange between marketer and customers is interactive and instantaneous and goes beyond the PC. • Marketers must offer more products and services
- 12. A Simplified Model of Consumer Decision Making – Figure 1-1
- 13. Overview of Chapter 1 • Overview of Consumer Behavior • The Marketing Concept • The Marketing Mix and Relationships • Customer Value , Satisfaction, Trust & Retention • The Impact of New Technology on Marketing • A Simplified Model of Consumer Decision Making
- 14. End of Session “It does not matter how slowly you go as long as you do not stop”
Editor's Notes
- It is more expensive to secure new customer than to keep existing ones.