My Project Work,
CHAPTER ONE
1.0 INTRODUCTION
1.1 Background
Organisations, both private and public, in today’s dynamic marketplace and market space are increasingly leaving antiquated marketing philosophies and strategies to the adoption of more customer-driven initiatives that seek to understand, attract, retain and build intimate long term relationship with profitable customers (Kotler, 2006; Gronroos, C 1994; Paradise-Tornow, 1991; Narver and Slater, 1990). This paradigm shift has undoubtedly led to the growing interest in customer relations, management initiatives that aim at ensuring customer identification and interactions, customisation and personalisation that unreservedly lead to customer satisfaction, retention and profitability, among other things (Thompson, 2004; Gronroos et al., 1996; Xu et al, 2002; Dyche, 2001; Ryals & Knox, 2001; Stone, 2000). Organisations are therefore increasingly being more customer-centric and are much interested not just in acquiring new customers, but more importantly, retaining existing customers. This is perhaps because it costs more to attract new customers than to retain existing ones. It is believed that the average business spends six (6) times more to attract new customers than to retain old customers. Again it is more profitable retaining an old customer who is more likely to re-purchase or re-use a company’s products/services and recommend them to others.
Customer retention is, therefore, basically a product of customer loyalty and value which in turn is a function of the level of customer satisfaction or dissatisfaction (Reichheld, 1996). Customer satisfaction is central to the customer-centric paradigm shift, and has gained much attention from scholars and practitioners as it has become one of the cardinal means for achieving quality improvement programmes, and one of the crucial foci of strategic marketing management in business organisations that have long-term perspective for growth. This is because of the intriguing
1.0 INTRODUCTION
1.1 Background
Organisations, both private and public, in today’s dynamic marketplace and market space are increasingly leaving antiquated marketing philosophies and strategies to the adoption of more customer-driven initiatives that seek to understand, attract, retain and build intimate long term relationship with profitable customers (Kotler, 2006; Gronroos, C 1994; Paradise-Tornow, 1991; Narver and Slater, 1990). This paradigm shift has undoubtedly led to the growing interest in customer relations, management initiatives that aim at ensuring customer identification and interactions, customisation and personalisation that unreservedly lead to customer satisfaction, retention and profitability, among other things (Thompson, 2004; Gronroos et al., 1996; Xu et al, 2002; Dyche, 2001; Ryals & Knox, 2001; Stone, 2000). Organisations are therefore increasingly being more customer-centric and are much interested not just in acquiring new customers, but more importantly, retaining existing customers. This is perhaps because it costs more to attract new customers than to retain existing ones. It is believed that the average business spends six (6) times more to attract new customers than to retain old customers. Again it is more profitable retaining an old customer who is more likely to re-purchase or re-use a company’s products/services and recommend them to others.
Customer retention is, therefore, basically a product of customer loyalty and value which in turn is a function of the level of customer satisfaction or dissatisfaction (Reichheld, 1996). Customer satisfaction is central to the customer-centric paradigm shift, and has gained much attention from scholars and practitioners as it has become one of the cardinal means for achieving quality improvement programmes, and one of the crucial foci of strategic marketing management in business organisations that have long-term perspective for growth. This is because of the intriguing
References: 1 Anderson, E. W., Fornell, C. and Lehmann, D. R (1994) “Customer Satisfaction, Market Share and Profitability: Findings from Sweden,” Journal of Marketing, 58(3), 5366. 2 Danaher P 5 MTN Regional Office, Wa; www.yellowpages.com 6 National Telecommunication Policy (Republic of Ghana p13.), ( www.nca.org.gh): retrieve on June 3rd, 2011 7 Oliver, R. L (1980) “A cognitive model of the antecedents and consequence of customer Satisfaction”. Journal of Marketing Research, 17, November, pp 460-469 8 Singh, J 9 Vavra, T.G. (1997) Improving Your Measurement of Customer Satisfaction: A Guide to Creating, Conducting, Analyzing, and Reporting Customer Satisfaction Measurement Programs, ASQ Quality Press. 10 (http://www.controlyourimpact.com/2008/03/disadvantages-of-mobile-phones/phones/): retrieved on June 1st, 2011 11 www.nca.org.gh) on June 1st, 2011 12 (http;//en.wikipedia.org/wiki/marketingmix): retrieved on 21st May, 2011 13 www.mtn.com.gh: retrieved on 6th May,2011 14 (www.mtn.com.gh/NewsArtDetails.asp?AID=145&ID=11&FirstParentID=1) ): retrieved on May 22nd, 2012) 15 (www.BIZZcommunity.com): news retrieved on May 9th, 2011 16 (http://wikipedia.org/wiki/customer-satisfaction): retrieved on 21st May, 2011 17 (ghanabusinessnews.com/2011/11/08/five-telecom-firms-in-ghana-fined-1.2m-for-poor-services): retrieved on May 22nd, 2012) 18 (businessdailyonline.com/NG/inder.php/media-business/36776-glo-molbile-starts-operations-in-ghana) ): retrieved on May 22nd, 2012) 19 (news.peacefmonline.com/education/201203.php) ): retrieved on May 22nd, 2012)