On

Submitted To: Dr.Shubha Johari

Submitted By: Rameshwar Srivastava

(A) What are the reasons for losing customers? Product dissatisfaction Defect to competitor Employee attitude of indifference Poor professional image. Everything your marketing and advertising says reflects on your professionalism. Theres a shop in our town I drive past on the way to work. Dissatisfaction- The actual performance fell short of expectations

Relative Advantage- The customer perceives a higher benefit value associated with an alternative choice and believes it to be more gratifying. Conflict- A disagreement in which the customers and the companys views seem to be incompatible.

Loss of Trust The customer has no confidence that the organization can reliably fulfill its promises Cease to need the product or solution is no longer required

Novelty Seeking a need, due to satiation, or a drive, due to thrill seeking or an intellectual curiosity that causes people to choose variety over time.

(B) Discuss the retention strategy for dissatisfied customers.

Customer Retention is the activity that a selling organization undertakes in order to reduce customer defections. Successful customer retention starts with the first contact an organization has with a customer and continues throughout the entire lifetime of a relationship. A companys ability to attract and retain new customers, is not only related to its product or services, but strongly related to the way it services its existing customers and the reputation it creates within and across the marketplace. Customer retention is more than giving the customer what they expect; its about exceeding their expectations so that they become loyal advocates for your brand. Creating customer loyalty puts customer value rather than maximizing profits and shareholder value at the center of business strategy. The key differentiator in a competitive environment is more often than not the delivery of a consistently high standard of customer service.

Customer life cycle

Customer retention strategy- A plan identifying what basic retention objectives will be pursued and how they will be achieved in the time available is considered to be a customer retention strategy. Retention Strategies Welcome Reliability Responsiveness Recognition Personalization Reward Strategies

Customer retention can be done by following things.

Welcome A welcome strategy acknowledges the organizations appreciation for the initiation of a relationship or for the exchange. The welcome serves many purposes. The organizations appreciation for the initiation of a relationship Creating a delightful surprise, making a good first impression First touch: additional customer information Reassure the buyers that they have made the correct choices. Treat like a first date. Dont overdo it!

Reliability The organization can repeat the exchange time and time again with the same satisfying results. Keep promise Ensure consistent quality Continuous promotion is still the key. Responsiveness The organization shows customers it really cares about their needs and feelings. Loyal employees create loyal customers. Internal marketing. Customer-contacted employees should have the authority as well as the responsibility for date to date operational activities and CRM decision. Recognition Special attention or appreciation that identifies someone as having been known before. People respond to recognition. Recognition and appreciation help maintain and reinforce relationships. Personalization Use CRM system to tailor promotions and products to the specific customers. Offer engine: take customer data after it is analyzed and applies it to create the offer or message that is appropriate to the individual customer. Ex., My site, Click stream analysis, free ride, etc.

Access strategy Identify how customers will be able to interact with the organization. General contact, product return, technical report, service representative, change a mailing address Is the access quick and easy?

Communication In organization-initiated communication, organizations must consider the intended message, channel (medium), and receiver characteristics. In customer-initiated communication, consider the establishment of toll free calls, web sites, priority access for providing services and collecting customer data.

Reward strategies A retention strategy recognizes the need to reward customers for their loyalty by special treatment. Partnership Management Program Switching costs: financial penalty, time loss, psychological barrier Termination Penalty

Benefits of customer retention: Reduced costs for customer acquisition. Fostering greater interaction between business and customer. Having more delighted customer. Possibility of repeat business.

Challenges in retaining customers: Pricing Inconvenience Core service failure Service encounter failure Response to service failure Competition Ethical problems Involuntary switching