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Discuss the importance of loyal customers (King Customer) to the organisation.

Management gurus have coined terms like “King Consumer”, “Lead Consumer”, “Super Consumer” for the customer who is obsessed with an organisations offering. They are not only heavy users of the product of an organisation but also have a certain attitude towards the product. They are also known as “High passion fans”.

Eddie Yoon in his book “Super Consumers” states that lead consumers are only 10% of the total consumers but account for 30%-70% of the sales.

Most of the times we see die-hard fans of a certain brand, or super consumers for certain brands like Apple Products, Harley-Davidson, and Royal Enfield.

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How to connect with Super Consumers/ Lead Consumers/ King Consumers?

Some organisations ignore super consumers as weird obsessives which is a big mistake they make. If an organisation forges a good relationship with its loyal consumers they propel the business by getting more new customers and also share valuable feedback which helps making improvements to the product as well as associated services like delivery, promotions, etc. associated with the product. This benefits the organisation by keeping the competitors at bay, increase in market share, and increase in profits.

The major task with an organisation is to identify these super consumers. An organisation should invest in information systems so that it can store data on the existing customers, lost customers and new customers. Channels of communication should always be kept open with the customers.

From the organisations end efforts should be made to stay in touch with its customers. This helps in identifying the super customers from the new customers. It can be as simple as asking a customer to fill a form when they visit the store or a direct mail sent to customers. Customers can even be called to ask them simple questions –

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Explain the importance of retaining customers.

In this information age, almost all the organisations believe that customer is always right. The ones who don’t value customers cease to exist in the long run.

Today’s customer is spoiled by the number of options available in the market from different organisations. The customers are smarter because of the information available to compare different products. It is difficult to please a customer. They have many substitute products available at competitive prices and quality. Customers have access to reviews of products on internet from the different users of the products. As a result today’s customer has become more demanding.

Studies have proved that a business fails if it doesn’t maintain good relations with their existing customers. As the customers are demanding, the organisation cannot give a good product to them. It has constantly strive to give an excellent product.The firm cannot survive by making a sale to a customer. It has to forge a relationship with the customer to ensure that there are repeated sales from him/ her. The long-lasting relationship is beneficial for both the organisation as well as the customer. The organisations work doesn’t ends ate just manufacturing a good product, it has to invest is processes to ensure the products easy availability, delivery, after sales service, replacements, etc.

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Explain customer value, customer satisfaction, and customer profitability.

Customer value is the amount of benefits that a customer gets from buying a product. If the benefits received or experienced are high as compared to the cost of the product, we say Customer Value is high. For example, in recent years, there have been new entrants in the mobile market where companies like Xiomi, LeEco, Micromax, Vivo, etc. offer the same benefits that a premium device from a reputable brand like Samsung offers but at a lower price. Similarly Motorola entered the Indian market with its Moto G models by promising better benefits at a lower price.

Customer value is the difference between-
i) the value that a customer gains from owning and using the product, and
ii) the costs of obtaining the product.

Customer value doesn’t ends at delivering a high quality product but it is a continuous process and includes after sales services associated with the product. These are warranties, free repairing for a certain period, easy access to service centres, buy back options for an upgraded product, efficient delivery of different services, etc.

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What is Customer Relationship Management (CRM)?

A study at MIT’s Sloan school of management has found that 80% of the scientific breakthroughs came from the loyal customers rather than the manufacturers.

Studies have proved that a business fails if it doesn’t maintain good relations with their existing customers. An organisation cannot survive in the competitive environment by doing a good job. It has to strive continuously to do an excellent job and provide value to customers better than the competitors. The firm cannot survive by making a sale to a customer. It has to forge a relationship with the customer to ensure that there are repeated sales from him/ her. The long-lasting relationship is beneficial for both the organisation as well as the customer.

Maintaining good relations with the existing customers is important for continued success of a business. One satisfied customer will bring more customers to the business and one unhappy customer will take away many customers along with him.

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What are the benefits of Customer Relationship Management?

Most of the organisations are investing in customer relationship management systems to forge a long term relationship with customers. The purpose of CRM is to encourage use of technology to study its customers and deliver maximum value to them.

• CRM helps understand the needs and wants of customers. This information is utilised to create an offering better than the previous one as well as better than the competitors.

• Increased efficiency through automation. CRM utilises various systems to maintain records of customers.

• Identifies customers who can be converted as loyal customers. By understanding the issues as well as suggestions of the customers, the management brings improvements on the inputs. When a customer feels valued it gives them a sense of satisfaction and they continue giving business to the organisation.

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Explain the importance as well as the steps that an organisation should take for retaining existing customers and attracting new customers.

Attracting New Customers –
An organisation invests in promotion activities to influence buyers in a target market. Leads are identified through various in-store promotions where buyers are asked to fill a small form, or through surveys, trade shows, online site visits, etc. Once the prospective buyers are identified they are reached through direct marketing (mails, emails, and telephone) as well as personal selling.

A buyer before making a purchase does information search and looks for alternatives to fulfill his/her need and want. Many times, customers check the organisations websites or ecommerce sites and explore various products and read their reviews by other customers. The organisations should track the site visits by these buyers and should proactively reach out to them either by asking them to share their email id or attractive offers on the site itself (pop-ups like 10% discount, coupons, etc.) To make a maximum impact at this stage and influence buyers to buy their product, organisations invest in advertising and other promotion tools which highlight the quality and attributes of the product. The job of the sales people is to match the needs and wants of the prospective buyers with the different attributes of the product – features, additional benefits, price, etc.

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Discuss Total Quality Management (TQM) and the steps for implementing Total Quality Management.

Total Quality Management is an approach of the management to provide long-term customer satisfaction where all the members of the organisation contribute towards improving processes, products, and associated services.

Today’s customer is spoiled by the choices available in the market. The customer will not buy a product of average quality when a product from a different organisation is available in the market which is of high quality. To ensure survival as well as success, organisations don’t have any choice but to adopt Total Quality Management.

TQM ensures high customer value and satisfaction.
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