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Topics and Objectives:
Increasingly, businesses are thinking of customers - in addition to products and brands - as assets. Like products, customers too have a
lifecycle. Just as the Product Lifecyle is the foundation for Product Management, the Customer Lifecycle forms the foundation for Customer-Centric Marketing.
There are two short cases for today.e case focuses on the early stages of the customer lifecyle: prospecting and customer acquisition.
Part 1 - Readings:
Why Service Stinks, Business Week
A (rather opinionated) cover story article from Business Week lamenting poor service concludes that service is increasingly dependent on how valuable a customer you are. The article provides some eye-opening examples (both good and bad for the customer) highlighting examples of customer segmentation based on value.
Turn Customer Service in Customer Profitability,Management Review, 1994
- One of the earlier articles to argue that businesses should think of (and treat) their customers as assets.
Part 1 – Case: Custom Research, Inc. (A) (Harvard case 9-199-001)
Note: Feel free to skim (or skip entirely) Exhibit 2 on pages 7-14 unless you are particularly interested in seeing an example of a market
research study.
Case Preparation Questions: (prepare before class - in class you will break into groups to prepare a 5-minute team summry of your thoughts on
these questions)
- What did you learn from Exhibit 3?
- What did you learn from pages 19-22 that is not contained on page 18?
- Which customers do you think Custom Research should want to keep? How would you decide which customers to keep?
- What additional information would you like to have?
- How would you deal with any customers you don't want to keep?
- What would you do about potential new customers in the future based on your decisions
Part 2 - Readings:
The Customer Lifecycle
Marketers are all familiar with the Product Life Cycle - this note introduces the Customer Lifecycle which will serve as a unifying framework for
customer-centric marketing. As customers progress through the customer lifecycle, their profitability changes, firms accumulate more data on them and they are targeted with different marketing initiatives.
A Framework for Customer Relationship Marketing, California Management Review, 2001.
Part 2 - Case: The Independent Adviser for Vanguard Investors
Case Preparation Questions:
- Assess the results from the last prospecting effort.
If Dan could do it over again, which of the lists (AAA, BBB, etc.) would you advise him to mail to? Why?
Deliverable in class: I will ask each of you to check off which of the lists
(AAA,...) you would mail to if you could do it again.
- What should Dan do with regard to his next prospecting effort?
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