The document discusses the importance of building customer value, satisfaction, and loyalty for businesses. It notes that successful companies carefully manage their customer base. Total customer cost includes both monetary and non-monetary factors like time, effort, and psychological costs. Managers should conduct customer value analysis to understand customer perceptions and how a company compares to competitors. Customer satisfaction is linked to loyalty, but investing too much in satisfaction could leave other stakeholders unhappy. Periodic surveys can track satisfaction levels, and companies need to address complaints quickly to maintain loyal customers. The overall goal is to deliver quality that meets customers' needs and expectations.

1. Building Customer Value,
Satisfaction, and Loyalty

2. Successful are those
who carefully manage their
customerbase.

3. Traditional Vs. Modern
Customer
Frontline people
Customer
Frontline people
Middle managers
Middle managers
Top
Manager
Top
Manager
Managers who
believe
are
profit centers
Managers at every
level tends to the
need

4. tend to be value
maximizers, seeking superior alternatives

5. tend to be value
maximizers, seeking superior alternatives
–

6. tend to be value
maximizers, seeking superior alternatives
Customer-perceived value
–

7. tend to be value
maximizers, seeking superior alternatives
Customer-perceived value
–
Raise by
Or

8. Total customer cost also
include :
• Time
• Energy
• Psychological costs
• Usage
• Maintenance
• Disposal
• Ownership
• Product acquisition etc…

9. “ The real cost of anything is
the toil and trouble of
acquiring it “
- Adam Smith
Total customer cost also
include :
• Time
• Energy
• Psychological costs
• Usage
• Maintenance
• Disposal
• Ownership
• Product acquisition etc…

10. Mangers often
conduct
customer
value
analysis
Reveals the
strengths and
weakness compared to
Competitors

11. • Identify attributes customer value
• Assess the importance of different value
• Assess the company and competitor’s performance
• Examine how customer rates performance against competitor
• Monitor customer value

12. • Identify attributes customer value
• Assess the importance of different value
• Assess the company and competitor’s performance
• Examine how customer rates performance against competitor
• Monitor customer value
* Buyers operate under various constraints and analysis may fail !

13. Consumers have
various levels of
Loyalty…
“ Loyalty is a deeply held commitment to
or a preferred product
or service in the future despite situational
influences and marketing efforts having
potential to causes switching behavior. “
- Oliver

15. Satisfaction is pleasure
or disappointment
resulting from comparing
product CPV to
expectation

16. Investing more on
customer Satisfaction,
diverts fund from
stakeholders, leaving
them unhappy.

17. Satisfaction = Loyalty !
Customer satisfaction is also linked to higher profits

18. Periodic
surveys can
track customer
satisfaction…
Companies can hire “mystery shoppers”, who
report on the strong and weak point in buying
their product in market

19. Companies
need to keep a
check on the
customer
satisfaction…
Internet provides a
means to share both
bad and good word
of mouth to the rest
of the world.

20. Interesting numbers:
25 would be dissatisfied
But only 1-2 complain
95 believe complaining is
not worth the effort
The people who complain
return back to be loyal
customers, if complaint is
resolved quickly …
Out of 100 customers.

21. • Set up 24/7 toll-free hotline
• Resolve issues of the complaining customer
quickly
• Accept responsibility for customer’s
disappointment
• Use frontline people who are empathic
• Resolve complaints to customer’s satisfaction

22. Customer point of view :
Quality is the totality
of features of a
product or service
that bears on its
ability to satisfy
stated needs

23. Special thanks
• https://www.flickr.com/photos/danielygo/
• https://www.flickr.com/photos/kimberlynmerrill/
• https://www.flickr.com/photos/griddlecakes/
• https://www.flickr.com/photos/darwinbell/
• https://www.flickr.com/photos/whyld/
• https://www.flickr.com/photos/59937401@N07/
• https://www.flickr.com/photos/jurgenappelo/
• https://www.flickr.com/photos/jvk/
• https://www.flickr.com/photos/61278574@N06/

24. Thank you!

25. Created by :
Ashwin Sasikumar
Govt. Model Engineering College, Kochi
Prof. Sameer Mathur
IIM Lucknow
www.IIMinternship.com
During an internship under :