Page 254 - DMGT522_SERVICES MANAGEMENT

Unit 11: Customer Loyalty

This data was incorporated in the nationwide launch that constituted Phase II. After ironing Notes
out any issues that arose in Phase I, Phase II was implemented, making for a successful
system that handles queries of corporate clients cost-effectively and satisfactorily.

In the future, ICICI Bank seeks to build online customer communities (similar to the
World Wide Web) in its banking service by responding to customers’ needs with new
technologies. By providing its customers more power to manage their account and money,
ICICI Bank expects to increase customer loyalty and obtain long-term mutual benefits
from its customers.
Question:
Analyse for ICICI Bank the drawbacks of overt dependence on IT for building customer
relationships. How much of permission marketing is required?
11.7 Summary

This unit attempts to give an overview of the functions in as simple manner as possible.

The studies of the services environment factors would include the political, economic,
socio-cultural, legal and technological, etc. This analysis would give the service manager
a guiding template for doing business.

Expectations make a customer perceive the received offer in a judgmental mode. This is
due to the intangibility factor of the service offer. Variance between the expected offer and
the service receipt will generate ‘problems’, dissatisfaction, etc.

A customer’s purchase decision of a particular service largely depends on his perceptions
of the service. Therefore, it is necessary for service organisations to conduct a research to
know the factors that influence customer perceptions.
Service organisations should understand that service encounters play a crucial role in
satisfying or dissatisfying customers. To increase the satisfaction level of customers during
service encounters, service organisations should innovate ways of delivering their service.

A service organisation should not only communicate its promises clearly but should also
ensure that it keeps its promises. This will create a positive image of the company in the
eyes of its customers.

CRM is a business strategy that goes beyond increasing transaction volume. Its objectives
are to increase profitability, revenue, and customer satisfaction. To achieve CRM, a
company-wide set of tools, technologies, and procedures promote the relationship with
the customer to increase sales.

It is more expensive to acquire customers than retain customers. But customer retention
becomes a challenge in the era of heightened competition and decreasing customer loyalty.
Various researches point out to the fact that customer acquisition is five to ten times more
expensive than customer retention.
Service profit model is based on seven theorems, which says that customer loyalty is
linked with customer satisfaction and employee loyalty with employee satisfaction. But it
has been criticised by some on the grounds that the relation between satisfaction and
loyalty is not always linear.

CRM is not an activity only within a marketing department. Rather it involves continuous
corporate change in culture and processes. The customer information collected is
transformed into corporate knowledge that leads to activities that take advantage of the
information and of market opportunities.

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