Read the summary and the most important questions on Relationship Equity W5 KC5

• 1 Relationship Equity

• What is Relationship Equity? As we learned in Week 3.

  The tendency of a customer to stick with a brand despite their subjective and objective assessment of the brand. (drivers: Loyalty programs, Recognition, Community Programs, Affinity Programs and Knowledge Programs).

• What is the shift that is taking place in marketing and that is leading to relationships becoming more important than transactions?

  From transaction & product driven to Relationship & value driven.

• What is a result of the approach of companies when they try to focus on the relationships more instead of mass marketing?

  Companies want to have bigger brand portfolios to smaller groups of people.

• What are the 3 goals of a Marketing Strategy?

  1. Getting customers (acquisition); 
     
  2. Keeping customers (retention); 
  3. Growing customers (up-sell/cross-sell).
     

• 2 The Success Numbers

• With the focus changing from Mass Marketing to Marketing Relationships, a shift is also taking place from Market Share to Wallet Share. What does Wallet Share mean?

  It is the shift from the idea: 'how many people can I attract in the market' towards: how much of the target groups budget in the category is spent on me rather than my competitors. This is a measure of loyalty.

• 3 Relationship Effects

• What are the 2 Relationship Effects that are a result of Customer Loyalty?

  1. Keeping an exiting customer diminishes costs over time; 
     
  2. Relationships lead to an increase in revenue when the customer comes back for additional sales, when you increase your portfolio.
     

• 4 Relationship Dimensions

• What are the 2 Relationship Dimensions that measure the Relationship Strength?

  1. Behaviour: repurchase, encounters and usage;
     
  2. Attitude: the perceptions and attitude that a customer has towards a particular product or service.
     

• Loyalty Grid: Relationship Types, explain the 2 types of Loyalty.

  Behavioural Loyalty: when the behavioural side is strong or weak; 
  Attitudinal Loyalty: when the underlying attitudes, the commitment that is created, is low or high.

• Shortly discuss the different types of loyalty.

  Transactional relationships: sporadically; 
  True loyalty: high repeated behaviour and strong feeling; 
  Spurious loyalty: high repeat in behaviour but not originating from commitment - 2 year contract mobile phone provider/supermarket; 
  High commitment: latent loyalty - people are loyal and have high commitment but for example want variety. 

• 5 Watson ea 2015

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• What do Watson ea 2015 study in their metastudy, of all studies done regarding loyalty measuring and relationship strength, based on existing research?

  They ask the question whether it matters how loyalty is measured.