BUS 5112 - Marketing Management

Dr. Frank Billingsley

Portfolio Activity Unit 2

9 September - 15 September

1. Read the article: “Exploring Factors That Influence Consumer Loyalty to Automobile
Dealerships in New York.” and then perform the following:

• Provide some customer retention strategies which benefits organizations

• What actions are involved before the final decision to buy or consume a product and
services?

2. Using what you have learned from the course materials and other sources in Unit 1 and in
Unit 2, consider your own behavior as a buyer. Think about the kinds of things that move you
to make purchases, both large and small, and then answer the following:

• Before making a major purchase, what types of data do you gather?

• What types of data are most compelling to you? Do you buy impulsively?
• If so, what type of products do you buy impulsively?
• Are there ways in which you want to improve your own consumer behavior?

3. Take a moment and reflect on the topics introduced in this Unit.

• Formulate at least one question that arose while you were reading the material and
completing the assignments.
• Was there anything in this Unit that surprised you or caught your attention? Explain.

For assistance with reflective writing, read How to Write a Reflective Paper.

The Portfolio Assignment entry should be a minimum of 500 words and not more than 750
words. Use APA citations and references if you use ideas from the readings or other sources.
This assignment is graded by the instructor.
 Introduction

The cost of acquiring new consumers is higher than the cost of keeping current

clients. For example, gaining new customers can cost up to five times as much as keeping

existing ones, while repeat customers can yield more than twice as much gross revenue as

new ones (Cunningham, Il-Yeol, Song, & Chen, 2006). Therefore, the business must explore

factors that influence customer loyalty and devise strategies to foster lasting customer

devotion towards the organization to ensure profitability.

Customer Retention Strategies

According to O. Akaeze & Shaibu Akaeze (2017), four major categories that

influence customer loyalty in automobile dealerships are customer satisfaction, product

quality, service quality and price and reward strategy. Some customer retention strategies are

as follows:

1. Create a customer service team that will focus on first-time buyers and

existing customers; this will ensure that the existing buyers have a dedicated

team to go through should they have questions. Also, this will allow the team

to bond with the customer fostering a more profound relationship that can

serve as an opportunity to offer new sales should the need arise or a referral

for another purchase.

2. Optimize product quality per customer's desire. Personal factors can indicate a

customer's preferences in terms of product quality. Kotler & Keller (2016)

highlighted that personal factor include personality, self-concept, gender, age,

and lifestyle.
 3. Improve service quality by catering to the specific demands of customers. The

customer's happiness will rise due to the personalised service that may answer

the customer's specific wants. The customer's unique requirements should be

noted during the first transaction and followed up on after-sales support. This

method can help avoid the customer attrition rate after the first transaction.

4. Provide customer loyalty program designed to provide incentives to customers

to encourage the continued relationship. An example is a loyalty card that will

entitle the customer to discounts and rebates for continued patronage, referral

rewards for successful client’s recommendations and extended warranties for

bundle purchases made.

The Consumer Decision Process

According to Kotler & Keller (2012, p. 161), the buying decision has six steps:

problem identification, information gathering, alternative evaluation, purchase choice, and

post-purchase behaviour. Before making a final selection, the first three must be completed.

First and foremost, the buyer must believe that they have a requirement. After

establishing the need, the customer seeks a product or service to meet or solve the problem.

Next, when the buyer has found what they are looking for, they begin comparing products

based on quality, pricing, and durability. Finally, they have all the data regarding the goods

and are confident that it meets their needs when making a buying decision.

Buying Motivation

There are a ton of factors that influence consumer buying behaviour. The list runs

from situational factors, time, reason for the purchase, mood, personality and self-Concept,
lifestyle, motivation, perception, learning, attitude, culture, social class, reference groups and

opinion leaders and family.

The author, on the other hand, shops for necessities. The author subscribes to the idea

that less is more and adapt a minimalist lifestyle; however, she is no stranger to peer pressure

resulting from buying on impulse, such as always following a trend on having the latest

iPhone. Impulse buying can be averted if the buyer does not give in to peer pressure and cater

only to the actual needs.

To summarize, gathering facts before purchasing a product or service and doing the

necessary buyer purchasing procedures is critical. Additionally, having a solid sense of self

and a support group that satisfy the need for love and affection will prevent the rest of the

millennial buyers out there to dive into unnecessary expense to feel acceptance and approval.

Reflection

While reading the material, one cannot help to wonder, does customer satisfaction

guarantee a business success?

Considering the evidence presented by the paper presented by O. Akaeze & Shaibu

Akaeze (2017), the reality that customer satisfaction alone can no longer guarantee for a

business to succeed is astonishing. Traditionally, customer satisfaction is the centre of all

activities and ensuring the fulfilment of customers desires will equate to profit and revenue.

However, in light of the new evidence shared, customer satisfaction appears to be not

enough. Businesses must be able to secure customer loyalty to secure continuous patronage.

Thus, organisations must explore factors that influence customer loyalty and devise strategies

to foster lasting customer devotion towards the entity.

 References

Akaeze, C. O., & Akaeze, N. A. S. (2017). Exploring factors that influence consumer loyalty
to automobile dealerships in New York. Journal of Business Theory and Practice, 5(2), 98-
119.

Barak, B., & Gould, S. (1985). Alternative age measures: A research agenda. ACR North
American Advances.

Berry, L. L. (1995). Relationship marketing of services—growing interest, emerging

perspectives. Journal of the Academy of marketing science, 23(4), 236-245.

Cunningham, C., Song, I. Y., & Chen, P. P. (2006). Data warehouse design to support
customer relationship management analysis. Journal of Database Management (JDM), 17(2),
62-84.

Gaumer, C. J., & LaFief, W. C. (2005). Social facilitation: affect and application in consumer
buying situations. Journal of Food Products Marketing, 11(1), 75-82.

Kani, J. (2015). Factors That Influence Consumers’ Buying Behavior. The Marketing OER
ToolKit.

Kotler, P., Keller, K. L., Manceau, D., & Dubois, B. (2016). Marketing Management, 15e
édition. New Jersy: Pearson Education.

Kulbytė, T. (5). UNIQUE WAYS TO INCREASE CUSTOMER RETENTION (AND

INCREASE PROFITS!). Super Office. En ligne: https://www. superoffice.
com/blog/customer-retention-tips-withcrm-software/, consulté le, 20(03), 2020.