Measuring and Managing the Benefits of Customer Retention

Das Narayandas

114 citations0/0 files storedJournal of Service Research

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Customer Service Quality and Loyalty Consumer Market Behavior and Pricing Customer churn and segmentation

Abstract

Past research on the benefits of customer retention (BCR) has been characterized by the lack of a psychometrically adequate criterion. Research has primarily operationalized the BCR by using only repurchase intent or a factor score of several measures including repurchase intent, word of mouth, and price tolerance. In the process, it has ignored the possibility of a hierarchical ordering of the BCR measures that would lead to a unidimensional and cumulative BCR scale. In this article, the authors investigate this issue using a set of intent measures developed based on past work in customer retention, customer loyalty, brand loyalty, and satisfaction. As hypothesized, support is foundfor a unidimensional and cumulative BCR scale. The authors also investigate howfirms can use BCR along with satisfaction to monitor and manage customers. They propose that vendors use a customer management strategy that is based on managing both satisfaction and BCR.

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References

1970Exit, Voice and Loyalty: Responses to Decline in Firms, Organizations, and States.1994Determinants of Long-Term Orientation in Buyer-Seller Relationships 1994Customer Loyalty: Toward an Integrated Conceptual Framework 1990Evaluating Service Encounters: The Effects of Physical Surroundings and Employee Responses 1996The American Customer Satisfaction Index: Nature, Purpose, and Findings 1993The Antecedents and Consequences of Customer Satisfaction for Firms 1994Customer Satisfaction, Market Share, and Profitability: Findings From Sweden 1992Relationships between Providers and Users of Market Research: The Dynamics of Trust within and between Organizations

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2000Relationship Marketing — Some Reflections on the State-of-the-Art of the Relational Concept 2011Customer Loyalty, Repurchase and Satisfaction: A Meta-Analytical Review 2004Links between organisational and customer variables in service delivery 2005A re‐assessment and refinement of RECOVSAT 2007Quality of past performance: Impact on consumers’ responses to service failure

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