Customer equity management : the impact of strategy drivers and customer data management on customer equity outcomes

This research contributes to the field of customer equity by examining how important the strategy drivers of consumption and customer data management are in contributing to the value of the customer asset. A mixed methods approach focused on one sector: the Australian accommodation hotels. From this research, a deeper understanding of how to theorise, conceptualise and practice customer equity management has been achieved.

Customer equity drivers and future sales

Research on linking operational marketing inputs to customer attitudes and customer behavior has been gaining significance concomitant with the growing recognition that customers are market-based assets. In response to this, researchers and practitioners have proposed several conceptual models. Despite recent advances in research, the results are still inconclusive as to the relationship between customer attitude and future sales. A reason for this could be due to the paucity of studies combining survey-based data with behavioral data to understand better the drivers of customer behavior. With that in mind, the authors investigate the effects of customer perceptions of key marketing actions on customer attitudes and actual customer behavior as reflected by future sales. The authors propose that customer perceptions of value, brand, and relationship—“customer equity drivers”—affect loyalty intentions and future sales. The results of the study, which is based on a sample of 5694 customers of a large European do-it-yourself retailer, suggest that customer equity drivers can significantly predict future sales, even after the authors control for the current sales level.

Customer value based entry decision in International markets the concept of International Added Customer Equity

Market entry decisions are some of a firm's most important long-term strategic choices. Still, the international marketing literature has not yet fully incorporated the idea of relationship marketing in general, and the customer value concept in particular, as a basis for market entry decisions. This article presents some conceptual ideas about a customer value based market selection model. The metric International Added Customer Equity (IACE), a straightforward decision criterion derived from the customer equity concept is presented as an additional decision criterion for export market selection and ultimately market entry.

Does the importance of value, brand and relationship equity for customer loyalty differ between Eastern and Western cultures?

The use of the customer equity framework as a focal marketing strategy to increase customer loyalty has emerged as an important topic. Despite a growing number of investigations, previous studies are limited by their strong U.S. and European orientations. Research into Western consumers cannot necessarily predict the behaviour of Eastern consumers though. Therefore, this study investigates whether the link between customer equity drivers (value equity, brand equity and relationship equity) and loyalty intentions is sensitive to the cultural environment. A sample of 1553 Chinese and 1085 Dutch consumers in the banking and supermarket industries reveals that all three customer equity drivers exert a greater impact in Western than in Eastern cultures. This study also shows that Eastern consumers in general have higher loyalty intentions than Western consumers. © 2013.

Profitable Customer Management: A Study in Retail Banking

The increasing focus of relationship marketing and customer relationship management (CRM) studies on issues of customer profitability has led to the emergence of an area of research on profitable customer management. Nevertheless, there is a notable lack of empirical research examining the current practices of firms specifically with regard to the profitable management of customer relationships according to the approaches suggested in theory. This thesis fills this research gap by exploring profitable customer management in the retail banking sector. Several topics are covered, including marketing metrics and accountability; challenges in the implementation of profitable customer management approaches in practice; analytic versus heuristic (‘rule of thumb’) decision making; and the modification of costly customer behavior in order to increase customer profitability, customer lifetime value (CLV), and customer equity, i.e. the financial value of the customer base. The thesis critically reviews the concept of customer equity and proposes a Customer Equity Scorecard, providing a starting point for a constructive dialog between marketing and finance concerning the development of appropriate metrics to measure marketing outcomes. Since customer management and measurement issues go hand in hand, profitable customer management is contingent on both marketing management skills and financial measurement skills. A clear gap between marketing theory and practice regarding profitable customer management is also identified. The findings show that key customer management aspects that have been proposed within the literature on profitable customer management for many years, are not being actively applied by the banks included in the research. Instead, several areas of customer management decision making are found to be influenced by heuristics. This dilemma for marketing accountability is addressed by emphasizing that CLV and customer equity, which are aggregate metrics, only provide certain indications regarding the relative value of customers and the approximate value of the customer base (or groups of customers), respectively. The value created by marketing manifests itself in the effect of marketing actions on customer perceptions, behavior, and ultimately the components of CLV, namely revenues, costs, risk, and retention, as well as additional components of customer equity, such as customer acquisition. The thesis also points out that although costs are a crucial component of CLV, they have largely been neglected in prior CRM research. Cost-cutting has often been viewed negatively in customer-focused marketing literature on service quality and customer profitability, but the case studies in this thesis demonstrate that reduced costs do not necessarily have to lead to lower service quality, customer retention, and customer-related revenues. Consequently, this thesis provides an expanded foundation upon which marketers can stake their claim for accountability. By focusing on the range of drivers and all of the components of CLV and customer equity, marketing has the potential to provide specific evidence concerning how various activities have affected the drivers and components of CLV within different groups of customers, and the implications for customer equity on a customer base level.

Customer repurchase intention: a general structural equation model

This paper develops a general service sector model of repurchase intention from the consumer theory literature. A key contribution of the structural equation model is the incorporation of customer perceptions of equity and value and customer brand preference into an integrated repurchase intention analysis. The model describes the extent to which customer repurchase intention is influenced by seven important factors – service quality, equity and value, customer satisfaction, past loyalty, expected switching cost and brand preference. The general model is applied to customers of comprehensive car insurance and personal superannuation services. The analysis finds that although perceived quality does not directly affect customer satisfaction, it does so indirectly via customer equity and value perceptions. The study also finds that past purchase loyalty is not directly related to customer satisfaction or current brand preference and that brand preference is an intervening factor between customer satisfaction and repurchase intention. The main factor influencing brand preference was perceived value with customer satisfaction and expected switching cost having less influence.

The immediate impact of coach succession events on season ticket holder attitudes

This study is the first to examine the immediate impact that succession events (e.g., removal and hiring) involving head coaches have on season ticket holder (STH) attitudes like satisfaction and renewal intentions. Grounded within a customer equity framework, large-scale survey data from cases of two professional sport teams is presented showing STH attitudes directly before and after major succession events. The data shows that appointing a new coach was met with increases in positive attitudes toward almost every aspect of the STH experience, where the case of removing a coach had no meaningful impact on attitudes. The findings of these cases reaffirm the view that coach succession is a multiple-phase process including distinct stages of removal and replacement. While it is the desire for improved on-field performance that often motivates coach succession, our findings suggest the impact of succession activities on fans is more wide ranging, with significant implications for marketers who manage fan relationships. In guiding the management of a team's fans, coach removal alone should not be relied upon to change attitudes or intentions toward a club. Appointing new leaders completes the cycle, increasing positive STH attitudes and, most importantly, giving an immediate lift to renewal likelihood.

Retorno do investimento em marketing por empresas de telefonia móvel: uma avaliação das operadoras do Estado de São Paulo

Este estudo no setor de telefonia celular adapta o modelo de investimento de marketing de Rust, Lemon & Zeithaml (2004) fornecendo um método de avaliação de investimento em áreas estratégicas de marketing (value, brand e relationship equity). Aplicado às operadoras de telefonia celular do estado de São Paulo (Vivo, Claro e TIM), o modelo permite calcular a probabilidade de um cliente mudar da operadora atual para uma concorrente, e verificar se a contribuição marginal advinda de uma ação mercadológica ultrapassa ou não seu custo de capital. Finalmente, através da aplicação do modelo obtém-se uma estimativa do customer equity atual das três operadoras de telefonia celular estudadas.

Asiakasarvon kehittäminen B2B-palveluyrityksessä

Yritysten välisen yhteistyön toimittajavalinta perustuu asiakasarvon määrittämiseen ja vertailuun. Tämä tutkimus tehtiin yritys A:lle asiakasarvon ymmärtämiseksi, kehittämiseksi ja asiakaspääoman kasvattamiseksi. Teoreettisesti keskeisiä käsiteltäviä teemoja ovat asiakasarvon luonti, toimittaminen ja kasvattaminen. Tutkimus on toteutettu pääasiassa kvalitatiivisesti teemahaastattelun kautta, jossa haastateltiin viittä yritys A:n asiakasyritystä. Tutkimus suunniteltiin yhdessä työn tilanneen yrityksen kanssa suhteessa aiempiin tutkimuksiin ja tavoitteisiin. Tutkimuksen tuloksissa havaittiin selviä vahvuuksia liittyen yritys A:n asiakasyritysten asiakasarvon teemoihin. Vahvuudet liittyivät muun muassa suoriin kustannuksiin, erillisiin lisäpalveluihin ja asiakaspalveluun. Kehitettävät teemat liittyivät pääasiassa työn suorittamiseen ja markkinointiin. Tulokset ovat käsitelty niin numeerisesti kuin tärkeimpinä teemoina. Asiakasarvoon ja –pääomaan liittyvistä teemoista esitetään lopuksi ratkaisuehdotus työn tilanneelle yritykselle, jota voidaan hyödyntää jatkossa ko. johtamisessa. Asiakasarvosta tulisi tehdä niin yrityskohtaisesti kuin tieteen kannalta lisää tutkimusta, sillä siinä on onnistuessaan merkittävä liiketoiminnallinen potentiaali.

Measuring the influence of customer-based store brand equity in the purchase intention

[EN] Store brands account for and important market share in the Spain and a further increase in expected in the next years due to the downturn. However, there is lack of research on store brand customer-based Brand Equity. This study attempts to propose an integrated model of Brand Equity in store or retailer brands, based on Aaker s well-known conceptual model. We propose a consumer-based model, including the main sources or dimensions of Brand Equity and considering the intention to purchase as a consequence. Based on a sample of 362 consumers and 5 store brands, structural equation modeling is used to test research hypotheses. The results obtained reveal that store brand awareness, loyalty along with store brand perceived quality have a significant influence on consumers intention to purchase store brands. Our study suggests that marketers and marketing managers from retailing companies should carefully consider the Brand Equity components when designing their brand strategies, and develop marketing activities in order to enhance their brands awareness.