Page 233 - DMGT522_SERVICES MANAGEMENT

Services Management Hitesh Jhanji, Lovely Professional University

Notes Unit 11: Customer Loyalty

CONTENTS
Objectives
Introduction

11.1 Influencing Customer Perceptions and Expectations
11.2 Relationship Marketing: Ladder of Customer Loyalty
11.3 Customer Retention through Relationship Marketing
11.4 The Service-profit Chain Model

11.5 Customer Loyalty
11.6 Components of CRM
11.7 Summary
11.8 Keywords

11.9 Review Questions
11.10 Further Readings

Objectives

After studying this unit, you will be able to:
Analyse how customer perceptions and expectations are managed through marketing
research
Analyse the concept of customer relationship management in services
Elaborate the concept of Customer Loyalty

Explain the components of CRM
Introduction

“Every great business is built on friendship.”
— JC Penney
The above findings give a clear message. The service firm tends to lose a lot of potential customers
at the very first stage of customer acquisition itself, by not making that all-important second
phone call or the second house call. If customer acquisition has been proved to be more expensive
than customer retention, then in order to build a profitable customer base an all-out effort
should be made by the service provider to optimise the cost, expense and effort of customer
creation.
More about the customer market: This consists of a service firm’s present and potential customer.
It is definitely the main reason for the existence of the firm. They consume and experience the
firm’s different service offers and generate the revenue for it to be a profitable proposition. They
are the target of the service firm’s communication, service process and delivery.

The customer is the main compelling feature for focusing the activities of the service marketer.
The service marketer should concentrate on the service transaction process – less with the intent
to hook the customer and turn the encounter into a successful sales transaction and more with a

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