Customer value – cementing social bonds


Company personnel work on cementing social bonds with customers by individualizing and personalizing customer relationships. In essence, thoughtful companies turn their customers into clients. Donnelly, Berry, and Thompson draw this distinction:

Customers may be nameless to be institution; clients cannot be nameless.

Customers are served as part of the mass or as part of larger segments; clients are served on an individual basis. Customers are served by anyone who happens to be available; clients are served b the professional assigned to them.

E-commerce companies looking to attract and retain customers are discovering that personalization goes beyond creating customized information. For example, the Lands’ End Live Web site offers visitors the opportunities to talk with a customer service representative. Nordstrom takes a similar approach with its Web site to ensure that online buyers are as satisfied with the company’s customer service as the in-store visitors; and, with the click of a button, Eddie Bauer’s e-commerce site connects shoppers to customers service representatives (CSR) with a text-based chat features.

A 2001 survey of 3,500 Web shoppers found that 77 percent of online shoppers have at least once selected an item for purchase but failed to complete the transaction. Jupiter Media Matrix has reported that two-thirds of Web shoppers abandon shopping carts. Worse, only 1.8 percent of visits to online retailers lead to sales, compared with 5 percent of visits to department stores. Analysts attribute this behavior partly to a general absence of interactive customer service in e-commerce. Customers looking for help are often sent to a text help file rather than a live sales representative. This can be frustrating and may prompt a customer to exit the site without buying. Another benefit of providing live sales assistance is the ability to sell additional items. When a representative is involved in the sale, the average amount per order is typically higher.

Not all customer service features involve live personnel. Both
of them and offer prerecorded customer service information. Gap’s Web site includes a “zoom� feature, which shoppers can use to get a close look at every detail of a garment, from elastic waist-bands to fabric prints. Lands’ End Live allows customers to “try on� clothes online using virtual models based on measurements supplied by customers

Adding Structural Ties

The company may supply customers with special equipment or computer links that help customers manage orders, payroll, and inventory. A good example is McKesson Corporation, a leading pharmaceutical wholesaler, which invested millions of dollars in EDI capabilities to help independent pharmacies manage inventory, order-entry processes, and shelf space. Another example is Milliken & Company which provides proprietary software programs, marketing research, sales training, and sales leads to loyal customers.

Lester Wunderman, an astute observer of contemporary marketing thinks talk about “patronizing� customers misses the point. People can be loyal to country, family, and beliefs but less so to their toothpaste, soap, or even beer. The marketer’s aim should be to increase the consumer’s pro-activity to repurchase the company’s brand

Some suggestion for creating structural ties with the customer:

1. Create long-term contracts. A newspaper subscription replaces the need to buy a newspaper each day. A 20-year mortgage replaces the need to re-borrow the money each year. A home heating oil agreement assures continuous delivery without renewing the order.

2. Charge a lower price to consumers who buy larger supplies. Offer lower prices to people who agree to be supplied regularly with a certain brand of toothpaste, detergent, or beer.

3. Turn the product into long-term service. DaimlerChrysler could sell “miles of reliable transportation� instead of cars, with the consumer able to lease different cars at different times or for different occasions such as a station wagon for shopping and a convertible for the weekend. Gaines, the dog food company, could offer a Pet Care service that includes kennels, insurance, and veterinary care along with food.

The title of this article as well as the example given above are self-explanatory regarding establishing social bonds in marketing.