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Strategic Management Document Essay

4227 words - 17 pages

Critical Appraisal of the strategic decisions taken in relation to customer retention in Sereno Spa
Customer retention management-ahmed and buttle
David clayton smith-34
Do It All’s loyalty programe – and its impact on customer retention
David Clayton-Smith
Managing Service Quality
Volume 6 · Number 5 · 1996 · 33–37

Stauss et al
Alan Jones
BYLINE: By Daniel McGinn And Terry Greene Sterling
You can succeed during this recession if you have a well thought out plan and a bit of persistence. When things are a little tougher, it simply separates out those who are prepared to work harder and more creatively.
Customers are your personal recession buster - but only if you ...view middle of the document...

Customers desire to spend is greatly reduced
2. Your ability to spend on customers is reduced

Enhance customer loyalty: Three things u hav to do for the customer:
Reichheld’s core propositions is that building and sustaining customer loyalty require a three pronged approach:
1. Retaining employees
2. Retaining investors
3. Retaining customers
From the service marketing perspective, the way to retain customers is to improve customer service quality and satisfaction( Berry and parashuraman, 1991, Zeithaml and Bitner, 1996, p.176)
From a general management perspective, DeSouza(1992), Rosenberg and Czepiel(1984) and Reichheld(1996) advocates retention measurement and the implementation of measures of preventing customers from defecting by learning from former customers, analysing complaints and service data, and identifying and raising barriers to customers’ switching. They also advocate an analysis of the firm’s customer portfolio with a view of creating a specified balance of them which may include first time buyers, repeat buyers, switched away from return, and last time buyers, and reorganising the firm for customer retention. Reichheld, 1996, holds that disloyal employees are not likely able to build an inventory of loyal customers and disloyal investors do not support long term relationship programmes.

Strategies for customers:
Paying for continuity and not just conquests, this may involve using vouchers to discriminate and reward customers that re buy.
Designing special programmes to attract and hold the most valuable customers.
Strategies for employees:
Recruiting staff carefully, staff who will maintain and improve the character and integrity of the firm.
Designing career paths for maximum productivity: do not rotate the managers as that would destroy the relationships that they have developed with managers and customers.
Introduce a concept of partnership which aligns the company’s interests with the employees.
Look for causes of employees dissatisfaction- thru exit interviews
Bonus cards: the more you spend, the more you get back – with a £5 voucher being given for each £100
spent. The levels of membership, purchases and administration costs have exceeded our initial expectations. Seeing whether we do actually have loyal customers and establishing the value and long-term benefits of a loyalty scheme to both our customers and ourselves.

1. Communications
2. Value : treat customers as human partners not object of sale, The tangible effects of companies commitment to retaining customers were first published by Dawkins and Reichheld (1990) who claimed that higher retention rate leads to higher net present value of customers.

3. Service: Service is free. Pile it on. For staff retention, practice the art of
servant leadership: “my customer is anyone who isn’t me.”
* Preserve core revenue- be careful of where u cut the costs: Your first responsibility in tough times...

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