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Creating Customer Value,

Satisfaction & Loyalty

The only value your company will ever create is
the value that comes from customers the ones
you have now and the ones you will have in the
future. Businesses succeed by getting, keeping,
and growing customers. Customers are the only
reason you build factories, hire employees,
schedule meeting, etc. Without customers, you
dont have a business.

Don Peppers & Martha Rogers

New Concept-market development
Educate/persuade to buy
Personal Selling-Eurochamps
Word of mouth publicity relationship with
Gift of Smile customer confidence & trust
Superior brand experience- intenstive training
& retraining + customer feedback
Long term success commitment to building
Success of AquaGuard
Several Awards for best practices
Traditional Organization Vs. Modern Customer Centric Organization
Customer Perceived Value
Customers are:
Form value expectation & act on it
Buy from firm perceived to offer highest
customer delivered value, defined as

customer perceived value = total customer

benefits - total customer cost
Fig : Determinants of Perceived
Customer Value
Total customer benefit Total customer cost

Product benefit Monetary cost

Services benefit Time cost

Personnel benefit Energy cost

Image benefit Psychological cost

Customer perceived value (CPV) :difference
between prospective customers evaluation of all
benefits & costs of an offering & perceived

Total customer value-perceived monetary value of

the bundle of economic, functional & psychological
benefits expected from a market offering because of
product, service, service, people and image

Total customer cost Perceived bundle of costs to

obtain, use, maintain, own & dispose an offering,
including monetary, time, energy & psychological
How to Increase CPV?
Raising economic,social emotional benefits
Reducing one/more costs

Customer :Two value offering V1 & V2

Favour V1 if V1/v2>1

Favour V2 of V1/V2 < 1

Indifferent if V1=V2
Steps in Customer Value Analysis
1. Identify major attributes and benefits that customers
2. Assess the qualitative importance of different attributes
and benefits
3. Assess the companys and competitors performances on
the different customer values against rated importance
4. Examine ratings of specific segments
5. Monitor customer values over time
Delivering High Customer Value
The Customer value proposition consists of the
whole cluster of benefits the company promises
to deliver, it is more than the core positioning of
the offering.

The customer value-delivery system includes all

the experiences the customer will have on the
way to obtaining and using the offering
Total Customer Satisfaction
Persons feeling of pleasure or disappointment
that result from comparing a products
perceived performance to the expectations.


Expectations ?- marketers promises/past

buying experience/friends advice etc.

Expectations high/low
Tracking Customer Satisfaction
Companies can monitor the customer loss rate
and contact customers who have stopped buying
and learn why this happened.

Companies can hire mystery shoppers to pose a

potential buyers and report on strong and weak
points experienced in buying the companys and
competitors products.

In addition to tracking customer value

expectations and satisfaction, companies need to
monitor their competitors performance in these
areas as well.
Customer Loyalty
A deeply held commitment to re-buy or re-
patronize a preferred product or service in the
future despite situational influences and
marketing efforts having the potential to
cause switching behavior.
Top Brands in Customer Loyalty
Apple iPhone Google
Clairol Amazon
Samsung Bing
Mary Kay J.Crew
Grey Goose AT&T Wireless
Clinique Discover Card
Avis Verizon Wireless
Wal-Mart Cheerios
Product & Service Quality
Quality is the totality of features and
characteristics of a product or service that bear
on its ability to satisfy stated or implied needs.

Product and service quality -customer

satisfaction -company profitability

Quality is the key to value creation and customer

Conformance quality
Performance quality
Marketers Role in Delivering Quality

Correctly identifying customers needs and


Communicate customer expectations properly

to product designers

Be sure orders are filled correctly and on time

Provide customers with proper instructions,
training, and technical assistance

Stay in touch with customers after the sale

Gather customer ideas for improvements and

convey them to the appropriate departments
Provide customers with proper instructions,
training, and technical assistance
Stay in touch with customers after the sale
Gather customer ideas for improvements and
convey them to the appropriate departments