BABIN / HARRIS CB Consumer Relationships CHAPTER 15 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to

BABIN / HARRIS CB

Consumer RelationshipsCHAPTER 15

©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

PART 5

Learning Outcomes1. List and define the behavioral outcomes of

consumption.2. Know why consumers complain and the

ramifications of complaining behavior for a marketing firm.

3. Use the concept of switching costs to understand why consumers do or do not repeat purchase behavior.

4. Describe each component of true consumer loyalty.

5. Understand the role that value plays in shaping loyalty and building consumer relationships.


15-2

Outcomes of Consumption• Expanded disconfirmation framework

• Cognitive processes• Procedural justice

• Affective reactions• Behavioral outcomes


15-3LO1

Complaining• Occurs when a consumer actively seeks

out someone to share an opinion with regarding a negative consumption event.

• Consumers who do complain react with different emotions (i.e., anger) than do those who do not complain.

• Complainers are valuable sources of feedback.


15-4LO2

Result of Complaining: Complainers

• More likely to become a satisfied customer.

• More likely to return.• Tells others when a company responds

poorly.• Valuable source of information.


15-5LO2

Result of Complaining: Noncomplainers

• Unlikely to return.• May tell others about experience.• Can become a satisfied customer if firm

can take preemptive action despite the lack of a complaint.


15-6LO2

Handling Service Complaints Effectively

• Thank the guest for providing the information.

• Ask questions to clarify the issue.• Apologize sincerely.• Show empathy for the customer’s situation.• Explain the corrective action that will take

place.• Act quickly.• Follow up with the customer after the

corrective action.


15-7LO2

Revenge• Rancorous revenge—a consumer yells,

insults and makes a public scene in an effort to harm the business.

• Retaliatory revenge—in extreme cases the furious consumer can become violent or try to vandalize the business.


15-8LO2

Word-of-Mouth (WOM)• Negative WOM—takes place when

consumers pass on negative information about a company from one to another.


15-9LO2

Word-of-Mouth (WOM)• Positive WOM—occurs when consumers

spread information from one to another about positive consumption experiences.


15-10LO2

Handling Negative Publicity• Do nothing; it will go away.• Deny responsibility for any negative event.• Take responsibility for any negative events

and be visible in the public eye.• Release information allowing the public to

draw its own conclusion.


15-11LO2

Switching Behavior• Switching—a consumer chooses a

competing choice, rather than the previously purchased choice, on the next purchase occasion.


15-12LO3

Switching Costs• Switching costs—the costs associated with

changing from one choice to another.• Procedural—involves lost time and effort.• Financial—the total economic resources that

must be spent to obtain value from a new choice.

• Relational—the emotional and psychological consequences of changing.


15-13LO3

Consumer Loyalty• Customer share—the portion of resources

allocated to one brand from among the set of competing brands.• Also known as share of wallet.

• Customer inertia—a consumer will tend to continue a pattern of behavior until some stronger force motivates a change.

• Loyalty card/program—keeps track of the amount of purchasing a consumer has had with a given marketer and offers rewards.


15-14LO4

Customer Commitment• A strong feeling of attachment, dedication,

and sense of identification with a brand.• Loyalty is a function of customer share and

customer commitment.


15-15LO4

Antiloyalty• Antiloyal consumers—those who will do

everything possible to avoid doing business with a particular marketer.


15-16LO4

Relationships and the Marketing Firm

• The exchange between a business and a consumer comprise a relationship.• Customers have a lifetime value to the firm.• True loyalty involves both a continuing series

of interactions and feelings of attachment between the customer and the firm.

• Relationship quality—represents the degree of connectedness between a consumer and a retailer.


15-17LO5

Characteristics of Relationship Quality

• Competence• Communication• Trust• Equity• Personalization• Customer oriented


15-18LO5

Documents

BABIN / HARRIS CB Consumer Relationships CHAPTER 15 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to