Introduction
Research Objective
The aim of the research is to provide an explanatory study into the aspects/attributes that customers consider relevant in deciding whether to continue with the current service provider or to switch to an alternative provider or to switch off completely.
Literature Review
Customer loyalty is viewed as the strength of the relationship between an individual’s relative attitude and repeat patronage. The relationship is seen as mediated by social norms and situational factors. Cognitive, affective, and conative antecedents of relative attitude are identified as contributing to loyalty, along with motivational, perceptual, and behavioral consequences (Dick and Basu, 1994). In the customer-centered business, survival remains to the degree that customer satisfaction is met. Previous research studies have shows that the repurchase intent was the main benefit of customer retention. However, some had identified multiple benefits like repurchase intent, price tolerance, willingness to recommend etc. In reaching retention, vendors should manage satisfaction and consequences of customer loyalty. Customer loyalty and satisfaction are integral part of customer retention process. Customer retention is a primary measure of loyalty. There is a positive relationship between changes in satisfaction and share of wallet. In particular, the initial satisfaction level and the conditional percentage of change in satisfaction significantly correspond to changes in share of wallet. Income and length of the relationship negatively moderate this relationship. Loyalty and retention although positively moderate with share of wallet it is necessary to examine the cost of maintaining the particular customer.
In competitive business environment where there is an on-going/continues desire for a particular product or services, organizations focus their strategies not only on acquiring customers, but also keeping them as long as possible and encouraging them to increase purchase frequency by developing lasting relationships . Relationship marketing recognizes long-term value to the company of keeping customers. Customer Relationship Marketing is defined by Stone et al (2000) as the use of a wide range of marketing, sales, communication, service and customer care approaches to:
-
Identify the company’s named individual customers
-
Create a relationship between the company and its customers that stretches over many transactions
-
Manage that relationship to the benefit of the customers and the company
Bose (2002) defines customer relationship marketing as involving the integration of technology and business processes in satisfying the needs of the customers. According to Swift (2001), CRM can be defined as an enterprise approach to understanding and influencing customer behavior through meaningful communications in order to improve customer acquisition, customer development and customer loyalty. He added that CRM must be integrated into everything a company does and must involve the entire company.
Primarily the aim of CRM is to build loyal customer relationships, where the organization can anticipate the needs of the customers, use information to personalize relationships, and encourage the customers to further their business relationship with the organization by earning their confidence and trust. CRM emphasizes three essential ingredients of customer relationships.
1. Customer Acquisition – identifying the profitable customers and creating strategies to attract them.
2. Customer Development – delivery of customer needs, wants and requirements when, how and where they want them to optimize profits and revenue.
3. Customer Retention – building and sustaining customer loyalty.
Research Methodology
The researcher will employ both quantitative and qualitative approaches to data gathering. The researcher will make use of a survey and a focus group. A survey gathers data at a particular point in time with the intention of describing the nature of existing conditions can be compared, or determining the relationship that exist between specific events. Survey research according to Hutchinson (2004) can be defined most simply as a means of gathering information, usually through self-report using questionnaires or interviews (p. 285). The attraction of a survey lie in its appeal to generazability or universality within given parameters, its ability to make statements which are supported by large data banks and its ability to establish the degree of confidence which can be placed in a set of findings (Cohen et al., 2000, p. 171). The popularity of survey research is due in large to its utility on countless research situations. Surveys are used for such diverse purposes as needs assessment, program evaluation, attitude measurement, political opinion polling, and policy analysis, as well as for simple descriptions of behaviors, activities, and population characteristics. The scope of surveys can range from large-scale national surveys to smaller surveys confined to a single neighborhood, classroom, or organization. Another strength is its applicability on situations where direct manipulations of variables is either unfeasible to unethical (Hutchinson, 2004, p. 286). Surveys are best suited for descriptive research. Companies undertake surveys to learn about people’s knowledge, beliefs, preferences, and satisfaction, and to measure these magnitudes in the general population (Kotler 2000).
0 comments:
Post a Comment