Measuring and Valuing Customer Relationships

Chapter 2: Strategic Measures

Executive Summary

The Context for Measurement Frameworks

Putting the Customer on the Agenda

Measurement and the Marketing Mix

The Growth of Modelling

The Need for Balance

The Balanced Scorecard

Linking Behaviour to Outcomes

The Drivers of Customer Performance Model

Input Measures

Distinguishing between Motivation and Behaviour

Adviser Interview: Rudy Oetting and Geri Gantman

Buying-sequence Models

Gaps in Cause-and-effect Models

Even Satisfied Customers Defect

Market Share and Repeat Buying

Customer Measurements

Case Report: Berry Consulting

Adviser Interview: Christine Restall

Measurement of Financial Outputs

Case Study: Boehringer-Ingelheim

Key Learning Points

Chapter 3: Measuring and Managing Customer Behaviour

Executive Summary

The Importance of Customer Behaviour

The Loyalty Bandwagon

Computers and Customer Behaviour

Measuring Penetration and Price

Including Competitors in Behavioural Research

Sources of Competitor Data

Loyalty vs Acquisition

Case Study: Disneyland Paris

Key Measures of Customer Behaviour

Models of Repeat Purchase

Key Measures of Competitive Purchases

Equivalence of Multi-brand Measures

Modelling Multi-brand Patterns Multi-brand Measures for Slow-moving Goods

Measuring Attrition and Allegiance

Is the Bucket Really Leaky?

Adviser Interview: Bob Kestnbaum

Key Measures of Consumer Price Promotion Response

Case Report: Tesco Clubcard

Key Measures for Changing Markets

Key Measures for Trade Customer Behaviour

Key Measures for Pre-purchase

Key Learning Points

Chapter 4: Measuring Customer Satisfaction That Drives Sales

Executive Summary

Customer Satisfaction as a Key Performance Indicator

The Origins of Satisfaction Measurement

Developing a Satisfaction Research Methodology

Formal Research gets Dumped

Who Should Carry Out and Manage Satisfaction Research?

Digging Deeper for the Payoff

Case Study: Hewlett-Packard

Abandoning Flawed Satisfaction Measures

The Problem with Satisfaction Research

Making Attributers Compatible

Case Study: Research International's SMART

Low-involvement Purchases and Products

A Different Buying-sequence Model

Planning to Buy the Brand

Expectations, Indifference and Tolerance

Exceeding a Consumer's Tolerance

Researching the Boundaries of Tolerance

Adviser Interview: Robert East

Expectation or Experience?

Dominant Expectations

Dominant Experiences

Key Learning Points

Chapter 5: Segmenting by Involvement and Emotional Response

Executive Summary

New Models of Research

Segmenting by Involvement

Case Report: The Conversion Model?

Segmenting Satisfaction by Involvement

Case Study: Financial Services Provider

Segmenting by Emotional Response

Defining Critical Performance Attributes

Determining the Feature List

A Standard Services Feature List - SERVQUAL

Consumer-defined Attributes

Standards of Comparison

Linking Satisfaction to Behaviour

Research Design - Some Cautionary Words

Integrating Satisfaction with In-house Data

Options for Managing Satisfaction

Case Study: Barclaycard

Improving the Experience

Managing the Expectations

Key Learning Points

Chapter 6: Building and Measuring the Brand Relationship

Executive Summary

Linking Brand and Satisfaction Perspectives

Measuring Brand Equity

Defining a Brand

Valuing a Brand

The Customer's Experiences and Expectations

Brand Valuation and Financial Outputs

Brands and Customer Profitability

Supporting Price Premium

Supporting Repeat Purchase

Encouraging Trial Purchase

Sustaining Distribution

Supporting New Products and Extensions

Key Brand Concepts

Brand as Identity

Brand as Differentiator

Brand Awareness

Searching for a Brand's Soul

Measuring Brand Strength

Young and Rubicam's Framework

Aaker's Framework

Interbrand's Framework

Measuring the Brand's Effect on Relationships

Taylor Nelson AGB's Brand Vision Approach

Case Study: BT Personal Communications Division

Branding and Segmentation

Segmentation by Category

Brand Segmentation by Customer Value

Geographic Brand Segmentation

Lifestyle Brand Segmentation

Brand Personality Segmentation

Organizational Associations Segmentation

Perceived Value and Perceived Quality Segmentation

Brand Leadership and Esteem Segmentation

Multiple Brand Identities and Segmentation

Adviser Interview: Garth Hallberg

Key Learning Points

Chapter 7: Financial Measures for the New Customer Relationship Manager

Executive Summary

Finance Gets to Grips with Marketing

Advertising and Promotions Budget Control

Setting A&SP Budgets

Justifying Sales Promotion

Justifying Advertising Budgets

Benefits in the Short and Long Term

Controlling Advertising Commitment

Product-range Profit Management

Direct Product Profitability (DPP)

Activity-based Costing (ABC)

Case Report: Sharwoods

ABC in ECR

Accounting for Pricing Decisions

Value Engineering and Target Costing

Accounting for Customer Profitability

The Bain Loyalty Model

Adviser Interview: Jagdish Sheth

Valuing the Brand

Economic Value-added Approach

Risk and Reward Investment Models

Strategic Portfolio Model

Key Learning Points

Chapter 8: Implementing Customer Relationship Management

Executive Summary

The Need for New Measures

Obliterating the Company Structure

Resistance to Change

The Pillars of Marketing Authority

Adviser Interview: Frank Abramson

Measuring Satisfaction, Benchmarking and Quality

Choosing the Best Measurement Tools

Approaching a Review

Case Study: Bass

Building the Framework

Organizational Effectiveness Models

Customer Behaviour Models

Adviser Interview: Gopal Iyer

Implementing Customer Satisfaction Measures

Competitor Benchmarking and Best Practice

Step-by-step Benchmarking

Chartered Institute of Marketing Benchmark

The PIMS Benchmark Method

From Measurement to Knowledge Management

What KMAT Tells You

Problems in Making the Change

Key Learning Points

Appendix: Business Intelligence Survey Findings

Use of Measurement Tools

Selection and Satisfaction With Tools

Usage of Customer Behaviour Tools

Usage of Customer Satisfaction Tools

References