L2: CUSTOMER RELATIONSHIP

• Reasons why customers are important

  • They provide the money that keeps the business alive
  • Their needs and wants are the basis of design, production, and marketing activities
  • They provide feedback
  • Their needs and wants drive the future development of products
  • Their opinions form the firm's brand recognition and position in the market
• How to make customers continuously patronize products or services

  Building long-term relationships, trust, and loyalty with customers
• Consumer


  The individual who uses the product, while the Customer is the person who buys the product
• Acquiring a new customer can cost five times more than retaining an existing customer
• Customer Lifetime Value formula: CLV = (PV) (RP) (RT)
• Key Principles of Relationship Marketing

  • Customer-centric approach
  • Personalization
  • Communication and engagement
  • Trust and credibility
  • Customer lifetime value
  • Loyalty programs and incentives
  • Community building
• Activity 1: Jose spends 1,500 for every visit in a fast-food chain with his friends once a month for a year
• Relationship Marketing


  A strategy focused on building long-term relationships with customers, emphasizing creating and maintaining strong connections, trust, and loyalty over time
• How to know if a customer is satisfied

  Customer satisfaction is the feeling a person experiences when an offering meets his or her expectations. Improve satisfaction by establishing appropriate expectations and delivering on them
• Customer


  An individual or entity that purchases goods or services from a business in exchange for payment
• Customers are important in a business organization because
• Customer Lifetime Value


  The forecasted sales or profits derived from the entire span of the future relationship with a particular customer
• Example calculation: An athlete spends 2,000 for every visit in a spa, goes twice a month for five years. CLV = 240,000
• Activity 2: A SHS student spends 500 pesos per visit in a bookstore once every three months for nine months