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RELATIONSHIP MARKETING & SERVICE QUALITY

RELATIONSHIP MARKETING & SERVICE QUALITY. Marketing & Service Quality Module. RELATIONSHIP MARKETING. Focused on building long-term, profitable customer-relationship Build on premise that important accounts need focused and continuous attention

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RELATIONSHIP MARKETING & SERVICE QUALITY

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  1. RELATIONSHIP MARKETING & SERVICE QUALITY Marketing & Service Quality Module

  2. RELATIONSHIP MARKETING • Focused on building long-term, profitable customer-relationship • Build on premise that important accounts need focused and continuous attention • “Getting to know our customers better so we can meet their wants and needs better.”

  3. How do we build relationship with clients? • Basic Marketing • Reactive Marketing • Accountable Marketing • Proactive Marketing • Partnership Marketing

  4. Customer Satisfaction = fx { PERCEIVED PRODUCT PERFORMANCE} and {CLIENT’S EXPECTATION} • If PP > E, Clients are very satisfied • If PP = E, Clients are satisfied • If PP < E, Clients are very dissatisfied

  5. Tools in Tracking and Measuring Customer Satisfaction • Complaint and Suggestion Systems • Customer Satisfaction Surveys • Ghost Shopping • Lost Customer Analysis

  6. THE COST OF LOST CLIENTS • Define and measure drop-out rate • Distinguish the causes of customer reduction • Identify those that can be managed better • Estimate how much profit the bank loses when it loses customers • Spend to reduce the bank’s drop-out rate • LISTEN, LISTEN, LISTEN to Customers

  7. HOW MUCH IS A CLIENT’S WORTH? *Interest=2.5% / mo.; SC=3%; #Yrs. Loyal=1 (4 cycles);Margin=70%

  8. HOW MUCH IS A CLIENT’S WORTH? *Ave. portfolio=115 accts; Drop-out rate=15%

  9. THE NEED TO RETAIN CLIENTS • Acquiring customers can cost five times more than the costs in satisfying and retaining current clients. • An average company loses 10% of its clients every year. • A 5% points reduction in customer drop-out rate can increase profits by 25-85%, depending on the industry. • The customer profit rate tends to increase over the life of the retained customer. SOURCE: Selling: The Personal Force of Marketing

  10. The KEY to Customer Retention is Customer Satisfaction • Stays loyal longer (Customer Loyalty) • Buys more as the Bank introduces new products and upgrades existing products • Talks favorably about the Bank and its products • Pays less attention to competing brands and advertising and is less sensitive to price • Offers product or service ideas to the Bank • Cost less to serve repeat clients than new customers because transaction are routinized

  11. HIGH SERVICE QUALITY HIGHER REVENUES LOWER COST HIGH CUSTOMER SATISFACTION Correlation of Service Quality and Bank Profitability

  12. SERVICE QUALITY • SERVICE - is any act or performance that one party can offer to another that is essentially intangible and does not result to ownership of anything. • QUALITY – is the totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs.

  13. Dimension of Service Quality • Reliability • Assurance • Tangibles • Empathy • Responsiveness

  14. Questions to ask to check if we are effectively providing service quality to our clients • Do we strive to present a realistic picture of our service to customer? • Is performing the service “right the first time”, a top priority of our Bank? • Do we communicate effectively with customers? • Do we surprise customers during the service process? • Do our employees regard service problems as opportunities to impress customers or as annoyances? • Do we continuously evaluate and improve our performance against customers’ expectations?

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