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Time-Life
Books: Managing Customer Affinity
Customer affinity is a combination of the relationship a customer
has with a firm and the expertise that the customer believes
the firm possesses. The concept of customer affinity flows from
the premise that a firm can apply its customer relationships
and customers' perceptions of its expertise to related products.
Time-Life Books is an example of a company that adeptly managed
customer affinity.
Federal Express: Marketing Strategy
to Influence Industry Thresholds for the Components of Customer
Equity™
Every industry has upper thresholds or maximum levels of acquisition,
retention, and offer response. If a firm spends an infinite
amount on acquisition spending, the maximum acquisition response
will be a number far less than one. The reason is that no matter
how much a firm spends, a large segment of customers will not
purchase the product or service. Further, there is a maximum
level for each component of Customer Equity™.
Federal Express understood the drivers of Customer Equity™
in its industry; with that knowledge it changed the industry's
maximum retention rate.
British Airways: Organizing
for Customer Equity™
Customer Equity™ management demands an organizational
structure that is built around the creation of, and capitalization
on, customer affinity. This structure must focus, across functions,
on the imperatives of knowing customers and their value and
of managing acquisition, retention, and add-on selling in an
integrated way. Once in place, these structural elements will
receive the reinforcement they need from the appropriate management
processes and systems. Consider this example of how British
Airways handled a situation in which they needed to supply supporting
tools to employees who were measured and rewarded for Customer
Equity™ creation. |
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