Analyzing the customer engagement value in the relationship lifecycle: A case study of Hiweb ADSL company subscribers

Document Type : Research Paper

Authors

1 Associate Professor, Faculty of Management, University of Allameh Tabatabaei, Tehran, Iran

2 Assistant Prof., Department of Management, Tabriz Branch, Islamic Azad University, Tabriz, Iran

3 MSc., MBA, University College of Nabi Akram, Tabriz, Iran

Abstract

Customers not only buy products from a company but also create values for it in other ways. Nowadays, customer engagement is in the center of the attention of corporate executives so as to create value for their company. By motivating the customer and gaining customer engagement, companies increase customer life cycle, attract new customers, and improve their products and services with the least investment. In this research, using a dynamic model, the components of customer engagement value (i.e. CLV, CRV, CIV and CKV) were investigated during the customer lifecycle. The data were collected from 328 subscribers of Hiweb Company. To test the hypotheses, analysis of variance was done using the SPSS v.23 software. According to the findings of the research, the customer engagement value does not remain the same during the customer lifecycle; at each stage of the life cycle (i.e. acquisition, development, retention and attrition), different values are created for the company. This value at the stages of the acquisition and attrition of the relationship is the lowest, while it is the highest at the stages of development and retention of the relationship. 

Keywords

References

  1. Baker, A. M., Donthu, N., & Kumar, V. (2016). Investigating How Word-of-Mouth Conversations About Brands Influence Purchase and Retransmission Intentions. Journal of Marketing Research, 53(2), 225–239.
  2. Berger, P. D., Eechambadi, N., George, M., Lehmann, D. R., Rizley, R. & Venkatesan, R. (2006). From Customer Lifetime Value to Shareholder Value: Theory, Empirical Evidence, and Issues for Future Research, Journal of Service Research, 9(2), 156-168.
  3. Blattberg, R. C. & Deighton, J. (1996). Manage Marketing by the Customer Equity Test, Harvard Business Review, 74(4), 136-144.
  4. Calder, B. J. & Malthouse, E. C. (2008), Engagement and Advertising Effectiveness, in Kellogg on Media and Advertising, Bobby J. Calder, ed. Hoboken, NJ: Wiley & Sons, 1-36.
  5. Cambra-Fierro, J. Melero-Polo, I. & Javier Sese, F. (2018). Customer value co-creation over the relationship life cycle. Journal of Service Theory and Practice, 28(3): 336-355.
  6. Chevalier, J. & Mayzlin, D. (2006). The Effect of Word of Mouth on Sales: Online Book Reviews, Journal of Marketing Research, 43(3), 345-354.
  7. Coussement, K., & Van den Poel, D. (2009). Improving Customer Attrition Prediction by Integrating Emotions from Client/Company Interaction Emails and Evaluating Multiple Classifiers. Expert Systems with Applications, 36(3), 6127–6134.
  8. Dwyer, F.R., Schurr, P. H. & Oh, S. (1987), Developing buyer-seller relationships, Journal of Marketing, 51(2), 1-27.
  9. EIU (2007). Beyond Loyalty: Meeting the Challenge of Customer Engagement Part I, The Economist Intelligence Unit 2007.

10. Fournier, S., & Avery, J. (2012). Firing Your Best Customers—How Smart Firms Destroy Relationships using CRM. In S. Fournier, M. Breazeale, & M. Fetscherin (Eds.), Consumer-Brand Relationships: Theory and Practice (301–316). London: Routledge/Taylor & Francis Group.

11. Ganesan, S. (1994) Determinants of long-term orientation in buyer-seller relationship, Journal of Marketing, 58(2), 1-19.

12. Gladwell, M. (2000). The Tipping Point: How Little Things Can Make a Big Difference. New York: Little, Brown and Company.

13. Gupta, S. & Zeithaml, V. (2006). Customer Metrics and Their Impact on Financial Performance, Marketing Science, 25(6), 718-739.

14. Gupta, S. & Mela, C. F. (2008). What is a free Customer Worth? Harvard Business Review, 86 (11), 102-109.

15. Gupta, S., Hanssens, D., Hardie, B., Kahn, W., Kumar, V., Lin, N., Ravishanker, N. & Sriram, S. (2006). Modeling Customer Lifetime Value, Journal of Service Research, 9(2), 139-155.

16. Henard, D. H. & Szymanski, D. M. (2001), Why Some New Products Are More Successful Than Others, Journal of Marketing Research, 38 (3), 362-375.

17. Hibbard, J. D., Kumar, N. & Stern, L. W. (2001). Examining the impact of destructive acts in marketing channel relationships, Journal of Marketing Research, 38(1), 45-61.

18. Jafari, S., Yaghobi Jahromi, Z. (2019). 'The Influence of Social Customer Relationship Management (SCRM) on Customer Relationship Performance', , 10(20), pp. 115-134.

19. Jap, S. D., & Ganesan, S. (2000). Control mechanisms and the relationship lifecycle: implications for safeguarding specific investments and developing commitment, Journal of Marketing Research, 37(2), 227-45.

20. Joshi, A. W., & Sharma, S. (2004). Customer Knowledge Development: Antecedents and Impact on New Product Performance. Journal of Marketing, 68(4), 47–59.

21. Kumar, V. (2008). Managing Customers for Profit: Strategies to Increase Profits and Build Loyalty. Upper Saddle River: Prentice Hall Professional.

22. Kumar, V. (2008a), Managing Customers for Profit. Upper Saddle River, NJ: Wharton School Publishing.

23. Kumar, V. (2008b), Customer Lifetime Value: The Path to Profitability. The Netherlands: Now Publishers.

24. Kumar, V. (2013). Profitable Customer Engagement: Concept, Metrics, and Strategies. India: Sage Publications.

25. Kumar, V., & Bhagwat, Y. (2015). Regaining Lost Customers: The Predictive Power of First-Lifetime Behavior, the Reason for Defection, and the Nature of the Win-Back Offer. Journal of Marketing, 79(4), 34–55.

26. Kumar, V., Aksoy, L., Donkers, B., Venkatesan, R., Wiesel, T., & Tillmans, S. (2010). Undervalued or Overvalued Customers: Capturing Total Customer Engagement Value. Journal of Service Research, 13(3), 297–310.

27. Kumar, V., J. Petersen, A. & Leone, R. P. (2010). Driving Profitability by Encouraging Customer Referrals: Who, When, and How, forthcoming, Journal of Marketing, 74(5), 1-17.

28. Lusch, R. F. & Brown, J. R. (1996). Interdependency, contracting, and relational behavior in marketing channels. Journal of Marketing, 60(4), 19-38.

29. Palmatier R. W., Kumar V. & Harmeling C. M. (2018). Customer Engagement Marketing. Palgrave Macmillan. (eBook). DOI 10.1007/978-3-319-61985-9

30. Pansari, A., & Kumar, V. (2016). Customer Engagement: The Construct, Antecedents, and Consequences. Journal of the Academy of Marketing Science, 45(3), 294–311.

31. Powers, T. M. & Menon, A. (2008). Practical Measurement of Advertising Impact: The IBM Experience, in Marketing Mix Decisions: New Perspectives and Practices, Roger A. Kerin and Rob O’Regan, eds. Chicago, IL: American Marketing Association.

32. Werner, R. & Venkatesan, R. (2008). Models for Customer Relationship Management (CRM), Handbook of Marketing Decision Models, Berend Wierenga, ed. Berlin: Springer Science and Business Media, 291-326.

33. Sawhney, M., Verona, G. & Prandelli, E. (2005). Collaborating to Create: The Internet as a Platform for Customer Engagement in Product Innovation, Journal of Interactive Marketing, 19(4), 4-17.

34. Mert, T., Davis, L. M. & Lemon, K. N. (2007). The WOW factor: Creating Value Through Win-Back Offers to Reacquire Lost Customers, Journal of Retailing, 83(1), 47-64.

35. Nadaf, M., khajeh, M. (2018). 'A Study of the Impacts of Firms' Capacity and Collaborative Values on Industrial Brand Equity in the Industrial Estate of Bushehr Province: A Case Study of Manufacturing Companies', , 10(19), pp. 213-232.

36. Trusov, M., Randolph E. B. & Pauwels, K. (2009). Effects of Word-of-Mouth Versus Traditional Marketing: Findings from an Internet Social Networking Site, Journal of Marketing, 73(5), 90-102.

37. V. Kumar & Pansari, A. (2016). Competitive Advantage Through Engagement. Journal of Marketing Research: August 2016, 53(4), 497-514.

38. Van den Poel, D., & Larivière, B. (2004). Customer Attrition Analysis for Financial Services Using Proportional Hazard Models. European Journal of Operational Research, 157(1), 196–217.

39. van Doorn, J., Lemon, K. N., Mittal, V., Nass, S., Pick, D., Pirner, P. & Verhoef, P. C. (2010). Customer engagement behavior: theoretical foundations and research direction, Journal of Service Research, 13(3), 253-266.

40. Venkatesan, R., & Kumar, V. (2004). A Customer Lifetime Value Framework for Customer Selection and Resource Allocation Strategy, Journal of Marketing, 68(4), 106-125.

41. von Hippel, E. (1986). Lead Users: A Source of Novel Product Concepts, Management Science, 32(7), 791-805.

Journal of Business Administration Researches
Volume 11, Issue 22
February 2020
Pages 231-255

Files

Share

How to cite

Statistics