Page 112 - DMGT308_CUSTOMER_RELATIONSHIP_MANAGEMENT

Unit 4: Customer Retention, Acquisition and Expectation

 At each successive level, the potential for sustained competitive advantage is also increased. Notes
 Firms should realize the benefits of effective CRM and invest sizable funds and time to
make it appropriate and working.

4.5 Keywords

Customer Acquisition Cost: It is the cost associated with convincing a consumer to buy your
product or service, including research, marketing, and advertising costs.

Customer Delight: Customer delight occurs when the customer’s perception of their experience
of doing business with you exceeds their expectation.
Customer Retention: It is the activity that the selling organization undertakes to reduce customer
account defections.
Fear, Uncertainty and Doubts (FUD): Fear, Uncertainty and Doubts, is a marketing strategy.
FUD is generally a strategic attempt to influence perception by disseminating negative and
dubious or false information. An individual firm, for example, might use FUD to invite
unfavourable opinions and speculation about a competitor’s product; to increase the general
estimation of switching costs among current customers; or to maintain leverage over a current
business partner who could potentially become a rival. The term originated to describe
disinformation tactics in the computer hardware industry but has since been used more broadly.
FUD is a manifestation of the appeal to fear.
GAMP: Global Account Management Programs
Prospect List: A prospect list is simply a list of customers that have been selected because they
are likely to be interested in your products or services.
Response Behaviour: The responses that come in as a result of a marketing campaign are called
response behaviour.

4.6 Review Questions

1. What do you mean by customer retention strategy?
2. Describe the keys of customer retention.
3. Write short note on emotional bonding.
4. Explain the benefits of customer involvement in product/service development.
5. Define customer acquisition. Discuss the reason for customer acquisition.

6. Describe, in detail, various strategies for customer acquisition.
7. Describe the methodologies and systems to manage customer prospects and inquiries,
generally generated by a variety of marketing techniques.

8. What do you understand by the term customer retention? Discuss its importance.
9. Discuss the strategies of customer retention.
10. What are the costs and difficulties of customer retention programs? How will you overcome
these hurdles?

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