CUSTOMER SERVICE

ABM 12 – SJCCI
 CUSTOMER SERVICE
PRINCIPLES OF MARKETING – WEEK 3 – ST. JOSEPH COLLEGE OF CAVITE INC.
CUSTOMER SERVICE
 A process of ensuring customer satisfaction
with a product of service.
 Enhance a customer satisfaction or
perception that a product has met or
exceeded expectations.
Perception is shaped and influenced
by the level and type of service that
customers receive before, during,
and after the actual purchase.
WHEN THERE IS A GOOD CUSTOMER
SERVICE, THE CUSTOMERS PERCEIVE VALUE
ON THEIR PRODUCTS THAT THEY BUY.

THEY DO NOT ONLY BUY A PRODUCT OR

SERVICE, BUT THEY ALSO BUY THE
EXPERIENCE.
THE VALUE OF CUSTOMER SERVICE IN
ASEAN AND GLOBAL BUSINESS SETTING
 CUSTOMER SERVICE PROGRAMS

 Retail establishments have realized that customers

are not only known to stores because of their
product offerings and convenient locations, but
also by the superior customer services they
provide.
 Rustan’s Department Store vs. Other establishments
They give customers "space" to browse Salespersons of similar establishments hover and
through merchandise leisurely. shadow the customer throughout his stay at the store.

Salespeople maintains physical distance They mention the product's price and recite a litany of
from the shoppers, offering assistance only product information every time a customer inspects or
when required. holds an item.

They are trained to discern if a customer They attempt to close the sale at seemingly every
prefers to browse and select on his own, or if opportunity, giving shoppers the feeling of of being
he already needs assistance. harassed into buying..

When the customer has decided on a product Shoppers who have decided to purchase an item are
to purchase, the salesperson will personally directed to a particular cashier's station, and must
bring the merchandise together with the personally wait until the item is processed and
bagged
payment to the cashier.
After which, he/she delivers the bagged
merchandise, receipt, and change to the
customer.
6. The purchase can also be gift-wrapped at
no additional cost.
 Merchandise display must be neat and orderly. Store interiors
should be clean. Transport facilities such as elevators and/or
escalators must be in good working condition.
 Store processes must be periodically reviewed and improved.
Internal procedures should be streamlined to reduce customer
waiting time.
 Merchandise in stockrooms should be arranged for easy access.
Organizations should continuously improve their customer service.
An intimate knowledge and understanding of customer needs and
wants can lead to effective customer service that can result in
long-term customer loyalty.
 THE FOLLOWING ARE SOME OF THE MORE POPULAR
CUSTOMER SERVICE PRACTICES IN THE PHILIPPINES
Customer Service Practice Practicing Organization(s)
free delivery most restaurants and fast food chains

automated in-home ordering system Rustan's Supermarket, Mercury Drug

free gift wrapping plastic book jacket Rustan's Department Store, Fully Booked

merchandise/document pick-up DHL and other selected courier services

free parking Some churches and religious organizations

valet parking Some hotels and resorts

Reservation, installment plans Some large department stores, bookstores

Complimentary refreshments, waiting lounge Most car dealership

Help desks, touch phone access, 24-hour Telecommunication and technical firms
customer hotline
 CUSTOMER RELATIONSHIP MANAGEMENT
 Customer relationship management (CRM) is a process of managing
an organization's interactions with current and future customers.
 Marketing companies create and maintain customer databases that
record and keep the following information: customer names,
birthdates, contact numbers, and physical and email addresses. The
information progresses to include customers' buying history and
behavior, i.e., what they buy, when and where they buy, in what
quantities and prices, and their responses to sales promotion efforts.
Customer database information is also used in customer
segmentation and profiling.
 CUSTOMER RELATIONSHIP MANAGEMENT

 Customer relationship management strategies may include:

 Shopper’s club (membership cards)
 Dropping of business card into a glass bowl beside the counter
 Giving raffles monthly/weekly
 Customer feedback
 Using e-mail to update customers on the new merchandise, promo offers,
and other store activities.
 Personalized promotions that the customers are willing to purchase.
 CUSTOMER LIFETIME VALUE
 Customer lifetime value (CLV) is the forecasted sales or profits that a company can
derive from the entire span of the future relationship with a particular customer.
 The CLV perspective has several distinct implications:
 It considers a longer-term perspective of a company's relationship with customers in
contrast to a short-term view of "take the customer's money and run."
 It calculates and compares costs of acquiring new customers and keeping old ones.
This can be used to determine the revenues that are lost when an existing customer
switches to another product. Costs for getting new customers are called acquisition
costs, whereas, costs for maintaining existing customers are called retention costs.
These are normally in the form of customer support and promotional incentives.
 It highlights the importance of market segmentation, with the recognition that some
customer groups are more profitable than others.
 CLV CAN BE MEASURED USING THE
FORMULA:

₱ _______ average peso value of a sale to a particular customer or

customer group

X _______ number of repeat purchases in a year

X _______ average retention time in months or years

= _______ customer lifetime value

EXAMPLE: AN ATHLETE WHO SPENDS 2,000 FOR EVERY VISIT
TO A SPA AND GOES TO THE SPA TWICE MONTHLY FOR AN
EXPECTED PERIOD OF FIVE YEARS WOULD HAVE A CUSTOMER
LIFETIME VALUE OF THE ATHLETE?

SOLUTION
P2,000 AVERAGE PESO VALUE OF A SALE TO A PARTICULAR
CUSTOMER OR CUSTOMER GROUP
X 24 NUMBER OF REPEAT PURCHASES IN A YEAR

X5 AVERAGE RETENTION TIME IN MONTHS OR YEARS

= ₱24,000 ATHLETE’S CUSTOMER LIFETIME VALUE

EXAMPLE: ANNA SPENDS ₱900 TO AN ONLINE SHOP 4X A
MONTH FOR AN EXPECTED PERIOD OF 10 YEARS. WHAT
WOULD BE THE CUSTOMER LIFETIME VALUE OF ANNA?