Asked by Nicholas Boren on Jul 08, 2024
Verified
Customer retention programs are based on what concept?
A) Customer excellence is the easiest macro strategy to follow.
B) Customer relationships should be viewed from a lifetime value perspective rather than on a transaction-by-transaction basis.
C) It is important to maximize profits in the first few months of a customer relationship.
D) Segmentation, targeting, and positioning analysis should not be rushed.
E) Firms must spend large amounts of money to retain customers.
Customer Retention Programs
Strategies and practices designed to keep customers engaged and continuing to purchase from a business over time.
Lifetime Value
The total net profit attributed to a customer over the entirety of their relationship with a company.
Transaction-by-Transaction Basis
Evaluating or managing each transaction individually rather than considering overall performance over time.
- Acknowledge the impact of consumer satisfaction and loyalty schemes on creating a durable competitive advantage.
Verified Answer
HL
Herber LoureiroJul 09, 2024
Final Answer :
B
Explanation :
Customer retention programs focus on building long-term relationships with customers and viewing their value from a lifetime perspective, rather than simply trying to maximize profits in the short-term. This approach acknowledges that retaining a customer and encouraging repeat business is often more cost-effective than acquiring a new customer.
Learning Objectives
- Acknowledge the impact of consumer satisfaction and loyalty schemes on creating a durable competitive advantage.