Chapter 5

1. Nordstrom can continue to provide exceptional customer service and increase brand
loyalty by continuing to ensure that the business revolved around the customer and make
sure employees interact positively with customers which is important for customer
relationship management and building loyalty [141]. Nordstrom can continue providing
extraordinary customer service by focusing on its value proposition and promising to
deliver on its proposition [127]. Nordstrom should continue to focus on its customer
relationship management system with its Personal Book that allows employees to enter
and recall customer preferences and by managing information at customer touch points
addressing customers and personalizing their experience at the cash register [135]. By
selecting and training employees to be knowledgeable and instilling the idea that the
customer is always right and providing incentives such as increased salary if he or she
does so will reduce the rate of customer churn [139]. Also low profit customer can be
made more profitable by offering more deals and sales that appeal to them and by
providing more benefits in its loyalty program through win back strategies [143]
2. Nordstroms greatest risk refers to its customer base and their consumer preferences
and tastes. Customer churn is a great risk for Nordstrom and increasing the customer
retention is a great challenge because after all the average company looses 10% of its
customer every year [140]. The customer defection could be caused by the change in the
latest trend and fashions and this poses a cost, as consumers may not be satisfied with the
current selection of products. The high prices that Nordstrom offers compared to its
competitors can especially cause defection if the competitor also offers great customer
service and has a great return policy like Nordstrom. Such retails include other high-end
retail stores like Macys and Bloomingdales.
1. Tescos great success in the UK is attributed to implementation of its customer loyalty
program called ClubCard and the data gather from it allowed Tesco to understand the
shopping patterns and preferences of its customers leading it to run its business more
efficient. Tesco should use this same formula as it expands to markets in other countries
especially Asia and garner similar success and growth. On order to grow in the UK as
well as overseas Tesco should continue to build lasting relationships with its customers
with not only loyalty programs and customer relationship management systems that keep
track and analyze the data gathered from the Club Card but also have employees to be
customer advocates that take the customers side and understand their point of view. The
customers voice can then be used to capture their needs or requirements in all business
decisions [141]. Tesco could also expand its loyalty program based on a club membership
to include a frequency program to reward customers who buy frequently and in
substantial amounts [142]. Tesco should also continue to diversify its product offering
with different services not only in the UK but also abroad to increase the market share
there and should also focus on providing better quality product and service so that that all
customer are satisfied with their goods
2. Tesco can take its customer loyalty program to the next level by focusing on improving
the way they analyze the data from the Club Card in their Customer Relationship
management system so that better customer profiles can be created to understand

customer needs and trends. The data can be used to in better and more effective ways to
attain profitable customers which can be figured out by calculating the customer lifetime
value and figure out ways to maximize this value [134]. Satisfaction should also be
measured from the incoming data and customer difficult and complaints should be taken
into account in order to increase customer retention.
Chapter 6
1. Disney does best to connect with its core consumers by marketing entertainment
product s to different age groups within the family and around the world. Disney touches
its audience efficiently and economically by marketing different products and services to
different groups of the consumer base and according uses different marketing strategies
to appeal to the different groups. With its five business segments the Walt Disney
studies, Park and Resorts, consumer products, media Networks, and interactive media,
Disney is able to appeal and connect to the different market segments and age groups.
For example Disney Parks Resorts appeal to all groups of people who seek entertainment
while Disney Channel mainly appeals to children. As can be seen, brand personality
appeals to all different people that match with the consumer personality mainly those
searching for excitement through Disney entertaining offerings [157]. The Disney
Difference that set its apart from its competitors invoke consumer emotions that make a
consumer feel excited and proud [163]. With Disneys core consumers being the family it
made sense why Disney focused on appeal to this group, as the family is the most
important consumer buying organization in society with direct influence on buying
behavior through the family of procreation mainly the spouse and children being the
influencer [154]. Last Disney uses technology to connect with its consumers in an
innovative way by using websites that give a virtual experience and podcasts of it shows
and release news of its products.
2.The benefits that Disney faces in expanding its brand in new ways through investment,
development and growth in new countries and offering new products and service is of
course the monetary benefits like increased revenue and profits but also increased brand
recognition by appeal to consumers core value with products that consumer all around
the world want to use and trust [159]When expanding the
greatest risk and challenge faced is keeping its core business and its brand consistency as
stated by CEO Disneys greatest challenge today is to keep a 90-year-old brand
relevant and current to its core audience while staying to its heritage and core brand
values. Therefore it is important that when expanding Disney has to be careful not to
contradict its heritage and core brand values. Another risk of Disney is societal and
cultural changes of consumer behavior. Changes are constantly occurs and make sure that
it its expansion in keeping up with current changes in the market segments [153].
1. Ikea is very successful because it provides unique a value proposition to it customers at
very low prices that it uses to increase it global presence and gain global customers. Ikea
has diversified its product line and catered to local consumers taste to capture what
consumers want and need by looking at their cultural differences, which is an important
influence on consumer buying behavior [151]. By sourcing its product from multiple

companies all over the world, Ikea is able to cater to its value proposition that ensures the
lowest price possible
2. Ikeas layout of the store designed in a one-way format results in customer seeing
everything available thereby increasing customer satisfaction and fulfill their need and
want by finding what they need easier and more efficiently. A satisfied customer is more
likely to purchase the product and will recommend the brand increasing customer
retention in their post purchase action [172]. Also by boxing all their products the
convenience for the customer and Ikea is increased with the ease of transporting the
product and saving shelf space so more Ikea products could be displayed and sold. Also
by having unconventional names for their products instead of product codes, people can
remember the product and solve the problem of memory retrieval when information is
forgotten [165]. The cons of Ikeas strategy that changed the way people shop is that the
size of Ikea with many suppliers in different countries in order to keep the price down
compromises on the quality standards of the product affect customer satisfaction and
customers being more aware of what they are buying. Its cost leading strategy leads to a
lack if product innovation and not maximizing on technological change can lead to
customer churn. Also the need to assemble all the furniture in the shop may be a higher
cost than the convenience from transportation as they may no know how assemble the
product especially old and handicapped people.