Showing papers on "Customer relationship management published in 2009"

Review: Application of data mining techniques in customer relationship management: A literature review and classification

Abstract: Despite the importance of data mining techniques to customer relationship management (CRM), there is a lack of a comprehensive literature review and a classification scheme for it. This is the first identifiable academic literature review of the application of data mining techniques to CRM. It provides an academic database of literature between the period of 2000-2006 covering 24 journals and proposes a classification scheme to classify the articles. Nine hundred articles were identified and reviewed for their direct relevance to applying data mining techniques to CRM. Eighty-seven articles were subsequently selected, reviewed and classified. Each of the 87 selected papers was categorized on four CRM dimensions (Customer Identification, Customer Attraction, Customer Retention and Customer Development) and seven data mining functions (Association, Classification, Clustering, Forecasting, Regression, Sequence Discovery and Visualization). Papers were further classified into nine sub-categories of CRM elements under different data mining techniques based on the major focus of each paper. The review and classification process was independently verified. Findings of this paper indicate that the research area of customer retention received most research attention. Of these, most are related to one-to-one marketing and loyalty programs respectively. On the other hand, classification and association models are the two commonly used models for data mining in CRM. Our analysis provides a roadmap to guide future research and facilitate knowledge accumulation and creation concerning the application of data mining techniques in CRM.

The Role of Customer Gratitude in Relationship Marketing

Abstract: Most theories of relationship marketing emphasize the role of trust and commitment in affecting performance outcomes; however, a recent meta-analysis indicates that other mediating mechanisms are at work. Data from two studies—a laboratory experiment and a dyadic longitudinal field survey—demonstrate that gratitude also mediates the influence of a seller's relationship marketing investments on performance outcomes. Specifically, relationship marketing investments generate short-term feelings of gratitude that drive long-lasting performance benefits based on gratitude-related reciprocal behaviors. The authors identify a set of managerially relevant factors and test their power to alter customer perceptions of relationship marketing investments to increase customer gratitude, which can make relationship marketing programs more effective. Overall, the research empirically demonstrates that gratitude plays an important role in understanding how relationship marketing investments increase purchase int...

Classifying the segmentation of customer value via RFM model and RS theory

Abstract: Data mining is a powerful new technique to help companies mining the patterns and trends in their customers data, then to drive improved customer relationships, and it is one of well-known tools given to customer relationship management (CRM). However, there are some drawbacks for data mining tool, such as neural networks has long training times and genetic algorithm is brute computing method. This study proposes a new procedure, joining quantitative value of RFM attributes and K-means algorithm into rough set theory (RS theory), to extract meaning rules, and it can effectively improve these drawbacks. Three purposes involved in this study in the following: (1) discretize continuous attributes to enhance the rough sets algorithm; (2) cluster customer value as output (customer loyalty) that is partitioned into 3, 5 and 7 classes based on subjective view, then see which class is the best in accuracy rate; and (3) find out the characteristic of customer in order to strengthen CRM. A practical collected C-company dataset in Taiwan's electronic industry is employed in empirical case study to illustrate the proposed procedure. Referring to [Hughes, A. M. (1994). Strategic database marketing. Chicago: Probus Publishing Company], this study firstly utilizes RFM model to yield quantitative value as input attributes; next, uses K-means algorithm to cluster customer value; finally, employs rough sets (the LEM2 algorithm) to mine classification rules that help enterprises driving an excellent CRM. In analysis of the empirical results, the proposed procedure outperforms the methods listed in terms of accuracy rate regardless of 3, 5 and 7 classes on output, and generates understandable decision rules.

Exploring Customer Loyalty Following Service Recovery: The Mediating Effects of Trust and Emotions

Abstract: Existing research shows that loyalty is a function of customer perceptions of trust following service recovery. The authors propose a cognitive appraisal model that portrays trust and emotions as key mediators in the relationship between perceived justice and customer loyalty. A structural equation model was used to test the conceptual model. The findings support the conjecture that emotions and trust have important mediating roles during the service recovery process. Furthermore, while existing research has focused primarily on negative emotion, the authors' model adopts a two-dimensional view of emotion (positive and negative emotions), and the results support the inclusion of both dimensions. Overall, the empirical support for the proposed model has important managerial implications for effective relationship management. By understanding the important mediating roles of trust and emotion, service employees can deliver more effective service recovery strategies and thereby enhance customer loyalty.

Service, services and products: rethinking operations strategy

Abstract: Purpose – This paper proposes a new approach to operations and supply strategy in the light of recent developments in the analysis of the respective roles of products and services in delivering benefits to customers.Design/methodology/approach – Reviews and synthesises concepts from operations management (OM), marketing, economics and related areas. Examples of product and service combinations are considered, drawing attention to the ways in which services may be distinguished from products. An institutional basis for defining services is favoured over IHIP. A corollary of this is how services are made tradable: the modularity theory of the firm is used to do this. The paper then outlines, considers and compares various approaches to the combination of products and services: “service‐dominant logic”, support services, product‐service systems, systems integration, performance‐based logistics, bundling and, finally, the notion of “the offering”.Findings – It is found that the notion of the business model is...

Making Sales Technology Effective

Abstract: Firms invest billions of dollars in sales technologies (STs; e.g., customer relationship management, sales automation tools) to improve sales force effectiveness and efficiency. However, the results expected from ST investments are often not achieved. This article proposes relationship-forging tasks that are critical to the link between ST use and key aspects of salesperson performance (i.e., a salesperson's relationship-building performance with customers and administrative performance). The authors evaluate relationship-forging tasks in the context of a model that considers the antecedents and consequences of three different uses of ST: accessing, analyzing, and communicating information. In general, the results of a field study, which is analyzed using block-recursive structural equation modeling, support the relationship-forging theory and show that relationship-forging tasks predict 57% of the variance in a salesperson's relationship-building performance with customers. The findings also support hypotheses that using ST either to analyze or to communicate information has mediated positive effects on a salesperson's relationship-building performance with customers. However, a salesperson's use of ST to analyze information has negative influences on administrative performance, creating an unexpected trade-off for sales and marketing managers.

Strategic Marketing Management

Abstract: This third edition of Strategic Marketing Management confirms it as the classic textbook on the subject. Its step- by- step approach provides comprehensive coverage of the five key strategic stages: * Where are we now? - Strategic and marketing analysis * Where do we want to be? - Strategic direction and strategy formulation * How might we get there? - Strategic choice * Which way is best? - Strategic evaluation * How can we ensure arrival? - Strategic implementation and control This new revised and updated third edition has completely new chapters on 'The Nature and Role of Competitive Advantage' and 'The Strategic Management of the Expanded Marketing Mix', and extensive new material covering: * The changing role of marketing * Approaches to analysing marketing capability * E-marketing * Branding * Customer relationship management * Relationship management myopia * The decline of loyalty The book retains the key features that make it essential reading for all those studying the management of marketing - a strong emphasis on implementation, up to date mini cases, and questions and summaries in each chapter to reinforce key points. Widely known as the most authoritative, successful and influential text in the sector, the new edition remains an irreplaceable resource for undergraduate and graduate students of business and marketing, and students of the CIM Diploma.

The Impact of Technological and Organizational Implementation of CRM on Customer Acquisition, Maintenance, and Retention

Abstract: In recent years, customer relationship management (CRM) has been a topic of the utmost importance for scholars and managers. Despite the evidence provided by numerous empirical studies, many companies that have implemented CRM systems report unsatisfactory levels of improvement. This study analyzes what influence companies can expect CRM implementation to have on performance and how they can leverage its impact. The authors propose a conceptual model that investigates the link between technological and organizational implementations, as well as the implementations' interactions with management and employee support and CRM process-related performance. By measuring CRM performance in terms of initiating, maintaining, and retaining customer relationships, the study provides a detailed picture of what CRM implementations are capable of achieving. The results of the empirical study, conducted across four industries and ten European countries, indicate that CRM implementations do not impact performance regarding all aspects of the CRM process alike, and that they do have an impact only if adequately supported by respective company stakeholders.

The Impact of Customer Relationship Management Implementation on Cost and Profit Efficiencies: Evidence from the U.S. Commercial Banking Industry:

Abstract: The impact of customer relationship management (CRM) implementation on firm performance is an issue of considerable debate. This study examines the impact of CRM implementation on two metrics of firm performance⎯operational (cost) efficiency and the ability of firms to generate profits (profit efficiency)⎯using a large sample of U.S. commercial banks. The authors use stochastic frontier analysis to estimate cost and profit efficiencies and employ hierarchical linear modeling to assess the effect of CRM implementation on cost and profit efficiencies. They find that CRM implementation is associated with a decline in cost efficiency but an increase in profit efficiency. A firm-level factor, CRM commitment, reduces the negative effect of CRM implementation on cost efficiency. The authors also find that two adoption-related factors, time of adoption and time since adoption, influence the relationship between CRM implementation and cost and profit efficiencies. Early adopters benefit less from CRM implementation than late adopters. However, time since adoption improves the performance of firms that implement CRM. By demonstrating the different ways CRM implementation influences cost and profit measures, the study provides valuable insights to CRM researchers and managers.

The nature and effectiveness of collaboration between firms, their customers and suppliers: a supply chain perspective

Abstract: Purpose – The purpose of this paper is to investigate a model of collaboration based on the notion of firms having strong working relationships with their suppliers and customers. Whilst issues associated with collaborative relationships between firms and their trading partners are a key theme currently being addressed in the supply chain management literature, there appears to be a lack of clear guidelines as to how such capability can be developed in a practical sense.Design/methodology/approach – Data from 418 Australian manufacturing plants are used to test the model. Two key constructs, customer relationship and supplier involvement, are developed. For predictive validity purposes, these constructs are regressed against firm performance construct.Findings – Results of structural equation modeling analysis show, inter alia, that there is some support for this collaboration model, with both collaboration‐based constructs influencing performance.Originality/value – The results provide an insight into ho...

Customer relationship management as a business process

Abstract: Purpose – Increasingly, customer relationship management (CRM) is being viewed as a strategic, process‐oriented, cross‐functional, value‐creating for buyer and seller, and a means of achieving superior financial performance However, there is a need for a more holistic view of cross‐functional as it relates to CRM The purpose of this paper is to describe a macro level cross‐functional view of CRM and provide a structure for managing business‐to‐business relationships to co‐create value and increase shareholder valueDesign/methodology/approach – In order to identify the sub‐processes of CRM at the strategic and operational levels as well as the activities that comprise each sub‐process, focus group sessions were conducted with executives from a range of industries The focus groups were supplemented with visits to companies identified in the focus groups as having the most advanced CRM practicesFindings – The research resulted in a framework that managers can use to implement a cross‐functional, cross‐f

Sales Technology Orientation, Information Effectiveness, and Sales Performance

Abstract: Sales managers need a practical means for evaluating returns from investments in sales technology implementations (including sales automation and sales-based customer relationship management systems). This research proposes a behavioral process-model approach that can be applied to evaluate sales technology implementations. We develop and test the model with data collected from the sales force of a major consumer packaged goods company. The results indicate that a salesperson's technology orientation has a direct impact on internal role performance and it affects performance with customers through a double-mediated mechanism involving the effective use of information and smart selling behaviors (planning and adaptive selling). Sales managers can influence sales technology orientation by providing better internal technology support, considering technology orientation along with customer's approval of technology in account assignments, and understanding the probability of negative effects through a salesperson's experience. In our sample, salesperson experience correlates with age, suggesting a "generation gap" effect on sales technology orientation.

The Diffusion of Services

Abstract: Many of the products introduced during the past two decades have been services rather than goods. An important influence on the growth and long-term profits of these services is customer attrition, which can occur at the category level (disadoption) or between firms (churn). However, the literature has rarely modeled how services penetrate a market and has not evaluated the effect of attrition on growth. The authors combine diffusion modeling with a customer relationship approach to investigate the influence of attrition on growth in service markets. In particular, the authors model the effects of disadoption and churn on evolution of a category and on growth of individual firms in a competitive environment. The authors show how neglecting disadoption can bias parameter estimation and, especially, market potential. They also derive an expression for the customer equity of a growing service firm and apply it to valuation of firms operating in competitive industries. The results for six of seven fi...

The value of B2B relationships

Abstract: – The purpose of the paper is to contribute to the knowledge of how relationship value, trust, commitment, satisfaction and loyalty intentions are defined and relate to each other It explores these relationships in the business‐to‐business (B2B) context by analysing manufacturing companies regarding to their main supplier, – After the literature review and several in‐depth interviews, a method of empirical analysis consisting of quantitative intervention with an ad hoc survey using a structured questionnaire has been developed Structural equations modeling is used to contrast the hypotheses on the links between the constructs analysed, – Confirmatory factor analysis provided satisfactory results With regard to the direct effects of the relationship value, the three relationships being considered were verified: relationship value has a positive influence on trust, commitment and satisfaction towards the supplier Also, and as already contrasted in previous studies, trust has a direct, positive effect on commitment In addition, and regarding to loyalty antecedents, data did not confirm that greater trust would increase loyalty but commitment did, leading to the conclusion that the effect of trust on loyalty is only indirect through the effect it has on commitment Loyalty was also positively affected by satisfaction with the supplier, – Limitations of this paper open lines for future research First, it considers that future research could include other variables affecting long‐term relationships Second, longitudinal studies could serve to enrich the results and illustrate the complexity of the direction in the links among the variables and take into account dynamics Third, a customer's perspective in the perception of value has been adopted in this paper Finally, relationship value has been operationalised as reflective and a formative approach could be adopted Implications for managers are in line with the detected importance of satisfaction and commitment as key factors because of their impact on intention to continue and expand business with the supplier Moreover, manufacturers should recognize the role of assessing and building relationship value with their partners as it has an impact – direct or indirect – on intentions to stay in the relationship, – In comparison, far less research has been done in the area of relationship value This paper emphasizes the role of perceived relationship value in relationship B2B marketing studies providing a model and contributing to relationship management

The Reinforcing Effects of Loyalty Program Partnerships and Core Service Usage: A Longitudinal Analysis

Abstract: In this research, the authors develop a dynamic model of cross-buying across loyalty program partnerships and test the model using data from a European airline. They identify a reinforcing mechanism that operates when loyalty program partnerships are operating effectively. The results suggest that customer usage of (and satisfaction with) the core service influences customer cross-buying from loyalty program partners. The cross-buying behavior then reinforces the customer's relationship with the core service, as cross-buying positively influences future purchases of the core service. Furthermore, the authors find that these reinforcing effects are influenced by the type of cross-buying service (partner) being considered. This dynamic reinforcement mechanism has not been shown in prior research. These findings have implications for understanding and management of loyalty programs and brand partnerships; valuating return on investments in improvements in product quality, service quality, and customer satisf...

Benefits of quantile regression for the analysis of customer lifetime value in a contractual setting: An application in financial services

Abstract: The move towards a customer-centred approach to marketing, coupled with the increasing availability of customer transaction data, has led to an interest in understanding and estimating customer lifetime value (CLV). Several authors point out that, when evaluating customer profitability, profitable customers are rare compared to the unprofitable ones. In spite of this, most authors fail to recognize the implications of these skewed distributions on the performance of models they use. In this study, we propose analyzing CLV by means of quantile regression. In a financial services application, we show that this technique provides management more in-depth insights into the effects of the covariates that are missed with linear regression. Moreover, we show that in the common situation where interest is in a top-customer segment, quantile regression outperforms linear regression. The method also has the ability of constructing prediction intervals. Combining the CLV point estimate with the prediction intervals leads to a new segmentation scheme that is the first to account for uncertainty in the predictions. This segmentation is ideally suited for managing the portfolio of customers.

Customer Relationship Management: A Strategic Perspective

Abstract: Over the last decade and a half Customer Relationship Management (CRM) has developed into an area of major significance. However, there is considerable confusion in the academic and managerial literature about what is meant by CRM and how if differs from relationship marketing. Further, despite heavy investment by organizations in CRM, there is extensive reporting of CRM’s failure to achieve anticipated results in the literature. This article reviews the conceptual differences between CRM and relationship marketing and defines these terms. It argues that, in many organizations, CRM failures have occurred through a lack of strategic focus. Key strategic issues are identified. A CRM Strategy Matrix is presented which considers the strategic context of companies and the implications for the development of their CRM strategies. Four alternative approaches towards building customer relationships are identified and migration paths between them are reviewed. Implications for implementing CRM strategy and future research are discussed.

The social role of financial companies as a determinant of consumer behaviour

Abstract: Purpose – The present study aims to analyze the influence of ethical and philanthropic responsibility of a financial entity on consumer behaviour. Specifically, it aims to analyze relationships among these dimensions and diverse constructs, such as the relationship satisfaction, trust, identification with the firm, business performance, relational outcomes and loyalty.Design/methodology/approach – The benefits of corporate social responsibility as a marketing tool are analyzed in a real context, directly asking the user for his/her perceptions about the financial entities. A personal survey for users was carried out, obtaining 789 valid responses. In order to comply with the aims of this research a model of structural equations was developed.Findings – It is seen that the relationship satisfaction, trust and identification with the entity are the main determinants of loyalty, while the ethical and social dimensions have an indirect effect. The ethical behaviour influences the perceived commercial performa...

The adoption of techno‐relationship innovations: A framework for electronic customer relationship management

Abstract: Purpose – The purpose of this paper is to develop a comprehensive research framework for understanding the adoption of techno‐relationship innovations. The second purpose is to examine the factors influencing the adoption of electronic customer relationship management (eCRM) applications.Design/methodology/approach – Existing adoption models were discussed and merged. Twenty potential determinant factors were proposed and a survey was conducted using a self‐administered questionnaire. Data were collected from 508 manufacturing small and medium manufacturing enterprises (SMEs) in Thailand. Hypotheses were tested using discriminant analysis.Findings – The research framework was validated. Seventeen factors have the ability to discriminate between eCRM adopters and non‐adopters. However, multivariate statistical analysis suggests that 12 factors have acceptable discriminate power and should be given priority. The top five influential factors are compatibility, industry pressure, customer pressure, subjective...

CRM literature: conceptual and functional insights by keyword analysis

Abstract: Purpose – The purpose of this paper is to review the literature on customer relationship management (CRM) to obtain a comprehensive framework of mutually exclusive CRM research areas and sub‐areas free of all potentially disruptive factors (plethora of CRM definitions, personal judgments, etc.).Design/methodology/approach – The keywords reported in 396 CRM articles published during the period 2000‐2006 are used to uncover first a great number of detailed keyword sub‐groups and, by subject summation, the CRM‐related research areas. This classification scheme is considered unbiased, in contrast with any direct classification of articles alone among CRM research areas fixed in advance.Findings – An up‐to‐date conceptual and functional CRM framework emerges, consisting of a total of nine distinct research areas having their own weights, importance and popularity among the research community. Newly emerging CRM research areas are self‐identified as attracting the interest of the researchers and managers.Origin...