Essence, Simmons sponsor African-American survey
New York-based Essence Communications Inc. and Simmons Market Research Bureau, have teamed to create the Essence/Simmons African-American National Survey (AANS). Company officials says the AANS will be the most comprehensive, innovative research program thus far to provide a model for the systematic collection of information on the demographics, psychographics, consumer behaviors, values and attitudes of African-Americans throughout the continental United States. Consumer products companies are underwriting the initial methodology tests for the panel. Among those that have endorsed the project are AT&T, the Colgate-Palmolive Co., Polaroid Corp., Revlon, Toyota Motor Sales USA and United Distillers. The first stage of the survey is fieldwork for the methodology tests, which began Aug. 23, with a panel of 1,000 respondents. Fieldwork was conducted in New York, Los Angeles, Chicago and Atlanta. The last half will enlist 10,000 African-American respondents, recruited on-site nationwide. The panel will be available for customized concept tests, tracking studies, product-use surveys, attitude and opinion surveys. Custom surveys will use one-on-one interviews, focus groups, telephone and mail methodologies. All surveys can be targeted to specific demographic or geodemographic segments.
Atlas Site Analyst free with $1,000 demographic buy
Strategic Mapping Inc., Santa Clara, Calif., has introduced Atlas Site Analyst (ASA), a PC-based geographic information system (GIS) software package. ASA integrates computerized maps of an area with demographic data about the surrounding population and displays the number of customers or prospects within a specific proximity to a site. Designed as an add-on feature to Atlas GIS, ASA allows users to decide which geography and type of demographic and industry-specific data to evaluate. Choices include forecasts of buying patterns for particular products, and updated census information showing age, income, race, sex, education and other variables. The software was designed for franchise operators, retail outlets, consumer goods companies, restaurant chains and real estate development firms. ASA provides three ways for users to evaluate potential sites: ring studies, trade area analysis and grid analysis. An optional set of geographic and data packages is also available for use with ASA, designed to work with the product's standard reports; included in the set are U.S. highways, city locations (census cities and places) and a choice of ZIP code or census tract boundary files. Strategic Mapping also customizes ASA data packages for specific industries. The Image-Link, an optional add-on module to ASA, allows the system to link graphic images to any location on the map. ASA operates on PC-compatible computers running DOS 3.1 or higher with a minimum of 640K RAM and a 40MB hard disk. Users must have Atlas GIS to operate the system. Strategic Mapping is offering a fall "back to business" promotion where Atlas Site Analyst purchase of $ 1,000 worth of Atlas Demographic Packages or 1990 Census Packages. The offer is good until Nov. 15.
The company also has available low-cost upgrades to its Atlas GIS and Atlas Pro software programs. Version 2.1 of Atlas GIS and Atlas Pro new features include: the ability to receive and plot global positioning satellite (GPS) information in real-time, for use in mobile/dispatch applications; an updated point file for all five-digit ZIP codes; current world geographic boundary files and recent demographic data from the 1990 census; and a new algorithm.
A new version of Atlas MapMaker is available. The software program for IBM-compatible personal computers runs on Microsoft Windows. MapMaker for Windows version 1.1 includes such new features as an updated data starter set with current world geographic boundary files and demographic data from the 1990 Census. The program supports Windows 3.1-specific elements, and has improved support for "drag and drop."
Chilton offers express service
Chilton Research Services, Radnor, Pa., has introduced Chilton's Express Omnibus. The package offers a hotline to answer questions, which can be submitted as late as Wednesday for results the following Monday. The quality sample includes: 1,000 adults interviewed nationwide; fully replicated, representative, single-stage RDD sample; multiple callbacks; random respondent selection within the household; sample balancing by age, race, sex and education; and a full five-day field period. Demographics are available in standard or deluxe tab packages.
New version of Maplnfo available
Maplnfo Corp., Troy, N.Y., has begun shipping Maplnfo version 2.0 desktop mapping software for the Macintosh and UNIX (Sun and Hewlett-Packard) platforms. The new version includes new geographic and presentation features for viewing and analyzing corporate data geographically. The company also is shipping the MapBasic development environment for Macintosh and UNIX. With Maplnfo version 2.0, the MapBasic development environment enables use and integration of desktop mapping in business. Windows versions of both products are also available. Maplnfo for Macintosh incorporates Balloon Help, support for Apple Events and the ability for MapBasic applications to call external commands and functions. It also supports Apple Script, Apple's new programming language. Maplnfo for Sun and Hewlett-Packard supports remote procedural call operations.
Simmons, MIT join forces to target consumers
Simmons Market Research Bureau Inc. and Marketing Information Technologies Inc. (MIT) have entered a strategic partnership to offer advertisers the ability to target the consumers most likely to buy their product. For example, the same magazine could contain a sports equipment ad sent to the home of a sports enthusiast, or a "fat-free" product ad sent to a dieter. MIT's custom segmentation tools are sensitive to an advertiser's particular brands and user behavior.
New GIS databases from Claritas
Claritas/NPDC Inc.. Alexandria, Va., has designed Trendline-GIS and STF-3 InfoPak-GIS, two database products for use with geographic information system (GIS) software. The products can be used with Arc View. Atlas, Maplnfo, Spans and Tactician software. Trendline offers three database options and files derived from Claritas/NPDC's demographic current-year estimates and five-year projections. Summary Tape File 3 (STF-3) contains the first release of sample data from the 1990 decennial census. STF-3's 17 files are arranged into data sets called InfoPaks, to help guide users quickly to the relevant data. The databases are available in compact disc, Tecmar 8mm tape, on-line via MAX Access, and diskette.
Copy testing method zeroes in on consumers
NFO Research Inc., Toledo, Ohio, and New York-based ASI Market Research Inc. will jointly market NFO/ ASI targeted copy testing. The new method combines ASI's copy testing system with NFO's in-home testing among targeted samples of consumers drawn from the 425,000-household NFO panel. Targeted samples of consumers (for example, chronic ailment sufferers, the mature market, households with children, etc.) can be selected for copy testing. The NFO/ASI system uses NFO's video-based method, which tests advertising in the respondent's home, combined with ASI's copy testing experience and normative databases. The ASI system offers multimeasure capabilities.
Interactive TV card introduced in U. S.
New York-based ActivCard Networks Inc. has introduced ActivCard for use in the United States. The portable interactive television device links home television viewing with in-store sales, allowing advertisers to find out which commercial, at what time, and on what channel influenced a consumer's purchase choice. The system also records corresponding in-store purchases, allowing marketers to quantify the level of sales from specific commercials. The consumer can participate in various interactions with programming, including game shows, home shopping, couponing and training seminars; the card can later be inserted into a terminal at a retail store where coupons, rebates, discounts, proof of participation, gifts and other rewards are delivered. The system also can offer electronic betting and frequency programs, and purchasing and educational activities. The ActivCard resembles a small calculator and weighs less than 2 oz.
Simmons to distribute PDI scanner data
Simmons Market Research Bureau Inc. has acquired exclusive access to publication-related supermarket scanner data from Promotion Decisions Inc. (PDI), for magazines and advertisers. PDI supplies promotion concept testing, promotion and pricing evaluation through store-level and household-level supermarket scanner data. With this data, advertisers can evaluate the effectiveness of brand advertising with a passive behavioral measurement of sales behavior; brand sales can be tracked before and after a specific ad appears. The data can also be used for single-copy circulation management.
Joint venture yields syndicated targeting system
Claritas/NPDC, Alexandria, Va., has joined forces with Dallas-based TRW Inc.'s target marketing services division to combine P$YCLE household-level segmentation and a direct marketing database. The joint effort will allow marketers to target consumers according to their wealth and use of financial products. Marketers can profile their customers and segment their market by matching their proprietary customer files to the P$YCLE-coded TRW file of U.S. households. Marketers can later return to TRW and order precise prospecting lists using P$YCLE as a list select, or enhancement. The P$YCLE segmentation system divides households into 27 distinct types according to use of specific financial products and other financial characteristics. TRW's database of consumers now contains codes for these segments.
GIS seminars explain it all for you
GIS World Inc., Fort Collins, Colo., has introduced its 1993 GIS Discovery Seminar Series. The seminars explain how geographic information systems can be applied to various industries. The training facility at GIS World Inc. headquarters is equipped with 486 microcomputers and a UNIX workstation for hands-on training. Courses for 1993 include Introduction to GIS and Marketing, GIS in Health Care, GIS in Banking and GIS in Real Estate.
Financial profiles available
Claritas/NPDC Inc. has available Financial Prizm Profiles for financial marketers. The information looks at customer/prospect use of financial and consumer products, lifestyle pursuits and media habits. Uses of the profiles include branch location and analysis, customer profiling, cross-selling, strategic planning, direct marketing, new product development, media planning, market potential analysis, and actual vs. potential sales analysis. The data is available as a national sample of U.S. households; local profiles of 25 variables are available for 38 market areas. The information can be accessed using Claritas/NPDC's Compass workstation.
WATS center now has disaster-contingency feature
Bruskin/Goldring Research, Edison, N.J., has added a new feature to its "bulletproof system for prompt delivery of survey results. The firm's four regional WATS facilities enable it to transfer interviewing loads to other parts of the country when natural disasters strike or other circumstances disrupt operations at any location. Each WATS center is linked to the firm's central computer. The newest feature of the "bulletproof system is a back-up computer system. The redundant system will ensure that all data are processed regardless of any unforeseen circumstances.
New model gauges brand equity
Simmons Market Research Bureau Inc. has introduced EQX, a model for measuring brand equity in media, including print, broadcast and cross-media assessment. EQX measures brand strengths and weaknesses based on consumer values. The model can predict how changes to the various attributes can influence overall equity, and can simulate various strategies for each magazine and predict the net outcome. Simmons also has introduced its Product Information Booklet printed in Spanish.
Study examines EDLP strategy, information
Information Resources Inc., has conducted a new study. "Managing Your Business in an Every Day Low Pricing (EDLP) Environment." The study address such questions as: Are prices really lower? Do EDLP stores merchandise less often/differently? Are the effects of merchandising different? How do distribution strategies compare? How do sales rates compare? Do certain categories or departments behave differently from the norm? How can manufacturers operate more efficiently in this environment? Analysis of private labels and their influence on sales also is included.
Study respondents can be recontacted
Bruskin/Goldring Research, Edison, N.J., has available numerous respondents, contacted through its OmniTel studies, who can be recontacted to participate in other Bruskin/Goldring studies. Breakdowns by age, sex, income, geographic region and education are available. Information on home ownership, race, primary shopper, household size and composition, cable ownership, and driving behavior also can be provided. The data is collected each week.
Prizm system now has Canadian version
Claritas/NPDC Inc., Alexandria, Va., and Toronto-based Compusearch have developed a Canadian version of Claritas/NPDC's Prizm Cluster system. The new Canadian Market segmentation system, called Prizm Canada, defines every neighborhood in Canada in terms of 24 lifestyle types ("clusters"). Many of these clusters also appear in the U.S. version of Prizm, including "furs and stations wagons," "gray power," "back country folks" and "middle America" (renamed "middle Canada"). The system will be marketed by each firm in its respective country. Claritas/NPDC also has released "Precision Demographics: How Claritas NPDC Annually Updates Local Demographic Data," the second volume of its Market Essentials Expert Series. The free bulletin explains the methodology behind the firm's annual demographic update for small neighborhoods throughout the United States.
Study on sports participation now out
The National Sporting Goods Association (NSGA), Mt. Prospect, Ill., now has available the "Sports Participation in 1992: Series II" study. This year's edition features a newly introduced equipment purchase question. The 96-page report surveyed 21 sports including: billiards/pool, canoeing, horseback riding, ice and street hockey, ice and roller/in-line skating, skateboarding, scuba and snorkeling, table tennis, water skiing and windsurfing. The survey includes estimates of total dollar equipment expenditures per household for the sports, and establishes correlations between participation and purchases; percentage of total household expenditures for categories ranging from less than $50 to more than $750; and demographic breakdowns.
Technology in schools report available
Market Data Retrieval (MDR), Shelton, Conn., has available its report "Education and Technology 1993." The survey, based on responses from almost 4,000 districts and over 31,000 public schools grades K through 12, reports findings on use of videodisc players and eight other educational technologies.
New data and report programs hit market
Raosoft Inc., Seattle, has released Raosoft UFill and Raosoft UReport. UFill version 2.0 is a runtime data gathering program; UReport version 1.2 is a runtime report generator. The two products are the final links in the Raosoft SURVEY information gathering and analysis system for use with non-technical and technical personnel. UFill provides for paperless data collection, and will support mail-out disks, pop-up forms on network and notebook entry for data collection. UReport is a DOS-based report generator that allows users to produce ready-made reports from any dBASE-type database or Raosoft SURVEY database files.
Predictive CATI program combines features
Valley Forge Information Service has introduced the Predictive CATI. The telephone survey technology combines predictive dialing, a computerized list management and telephone dialing capability with CATI. The new product is designed especially for complex projects such as low-incidence tracking studies using random sampling. Valley Forge is the market research division of ICT Group Inc., Langhorne, Pa.
Newsletter covers women consumers
EDK Associates, N.Y., has available a preview of its newsletter, EDK FORECAST: Women Consumers. The bi-monthly newsletter covers the firm's ongoing polls of American women. The preview issue includes articles on emotional shopping, mother-daughter relationships, phone use and the feminist market.
Personal computer buying tracked
Trendata Inc., Norwalk, Conn., has available findings on personal computer purchases. A projectable telephone sample of 50,000 households is contacted the first 10 days after the end of each quarter; qualifying households are taken through a 50-question interview. More than 200,000 households are contacted yearly. Custom callbacks through the Trendata PC database are available.
New version of marketing information system
MarketPulse, Cambridge, Mass., has introduced MarketPulse C/S, an enhanced version of the company's ad-vanced mainframe marketing information systems. The new version incorporates client/server architecture and integrates with Windows software, Pilot's Lightship and Maplnfo. It brings advanced database marketing to the non-technical business user, allowing them immediate and simultaneous access to millions of customer records and transaction-level data. Other system features include enhanced customization, and campaign planning and tracking features.
Annual sourcebook of company information out
Washington Researchers Publishers has released the revised 1992-93 edition of its sourcebook "How to Find Information about Companies." The 675-page publication has been updated to include more than 9,000 sources, including libraries, on-line databases, CD-ROMs, and federal, state and local government agencies, for researching businesses in any industry. Also included are sections on identifying company and industry experts, contracting research, and using private investigation, credit reporting and bond rating services.
Comprehensive study available on children's market
Simmons Market Research Bureau has released the 1993 edition of "The Kids Study." The survey is a comprehensive marketing and media study on children aged 6 to 14; the new edition includes new product and service categories, including a beverage category expanded to include juices and powdered soft drinks; an expanded electronic category that includes computer information services, VCR usage and video games; and a new school/writing and art/drawing supplies category. The study is available in printed volumes or electronically through Choice, a PC application for accessing Simmons syndicated databases. The survey is based on in-home personal interviews and written questionnaires from 2,200 children. The sample is drawn from a national probability sample of households participating in the 1992 Simmons Study of Media and Markets.
Paumanok publishes gun/ammo companies list
The Primary List division of Paumanok Publications Inc., Shoreham, N.Y., has available its firearms and ac-cessories original equipment manufacturers mailing list. The list is a result of Paumanok Publications' market research analysis, "The U.S. Market for Firearms and Accessories." The list is segmented into domestic and overseas manufacturers of pistols, revolvers, rifles, shotguns and ammunition.
NRD adds mobile interviewing unit
NRD Marketing Services Inc., Hillsdale, N.J., has added a mobile in-terviewing unit (MIU) to its services. The MIU is a converted mobile home with two interviewing stations. It has a self-contained power source, and full kitchen and bath facilities. The MIU can be used to conduct copy or product tests among hard-to-reach populations. An ethnic interviewing staff is available.
Study looks at skin pharmaceuticals market
New York-based FIND/SVP has available a new 208-page report en-titled "The Market for Dermatological Drugs." For more information, write FIND/SVP, Dept. Q9A, 625 Avenue of the Americas, New York, N.Y. 10011.
Direct marketing software puts catalogs on-line
Information Clearinghouse Inc., Rancho Dominguez, Calif., has introduced the software program Market/ Net. The software program allows users to put product catalogs on-line. Customers can look and order directly through a personal computer, and can create customized catalogs of frequently ordered items. Prices and product lines can be changed instantly, for constant updating. Market/Net can display full-color graphics and fax back information for each catalog line or page. Customer can print their own order sheets, which can also be used as the purchase order.
Shopping mall research service introduced
Market Facts, Inc., Arlington Heights, Ill., has introduced National Showcase, a shared-cost research service. The service is conducted weekly among 500 adults at malls in the top 20 ADI markets. The new service is designed for marketers interested in in-person demonstration of their products and services. It will cover concept package and product testing, concept screening and advertising testing.
"Competitive Due Diligence" analyzes competition
The Daniel Adams Co., Danbury, Conn., has introduced "Competitive Due Diligence," a new service. The firm works with client companies from beginning to end, from setting objectives and investigation scope, through review and analysis of existing data, conducting field research, to development of competitive profiles and presentation of results. Projects usually take from 60 to 90 days.
International marketing directories updated for 1993
Atlanta-based MacFarlane & Co. Inc. has published its 1993 collection of International Marketing Directories and Business References. The 1993 collection includes 74 international marketing publications, which can be used by companies involved in or targeting markets in Europe, the Pacific Rim and other industrialized nations.
Investext adds new contributors to databases
The Investext Group of Boston has 10 new contributors to its Marklntel on-line databases of market research. The contributors expand coverage of industries to include health care, consumer products and technology. The two databases are: Marklntel, which features reports by business publishing firms; and Marklntel Master, which features exclusive on-line primary research from consulting and market research firms. Both databases are offered exclusively on The Investext Group's on-line delivery service, I/PLUS Direct. The new contributors to Marklntel include: Datamonitor, UK, with research on U.K. and European consumer product and service markets; Drewry Shipping Consultants, U.K., providing research on the international maritime industry; FIND/SVP, U.S.A., providing research on the food and beverage and health care industries, and demographic markets; M.I.R.C., U.S.A., specializing in high technology and medical products market research; Nicholas Hall & Co., U.K., with information on consumer health care products; and Packaged Facts, U.S.A., analyzing specific consumer market products including household products, specialty food and beverages, and home health products. New contributors to Marklntel Master include: Moscow Consulting Group, U.S.A., supplying research and analysis on the markets of the Commonwealth of Independent States (former Soviet Union countries); Ovum Ltd., U.K., specializing in computing and telecommunications; Palmer Market Research, U.K., providing research on U.K. home construction; and POVInc., U.S., contributing health care research on pharmaceuticals, OTC medications, bio-technology and diagnostics.
BRX/Global adds Line X-Tnsion Brand Equity
BRX/Global, Rochester, N.Y., has added Line X-Tnsion Brand Equity to its family of brand equity measurement techniques. Line X-Tnsion enables senior corporate executives to determine if using a strong brand name that has been developed in one category can reduce the cost and risk of entry into a new category. The technique is also useful for advertisers who are considering co-branding. Line X-Tension complements the Brand Equity Monitor and $9.99 Price Testing, the two existing brand equity services currently offered by BRX/Global.
Market Data reports on Japanese computer industry
Market Data International Inc., Landenberg, Pa., has released "The Japanese Computer Industry" report. The 263-page report was translated from the original, by the Japanese firm Yano Research Institute Ltd. The report finds that the Japanese computer industry is facing many of the same problems as other industries in a slow economy. The leaders in the computer market were NEC, Fujitsu, IBM Japan, Hitachi and Toshiba. The computer market dropped 2.1% from 1991 to '92. One way that stores are trying to increase profits is to charge a fee for services, including software-related fees; reception to this new policy, however, is expected to be cool.
Doane Marketing to release corn growers study
St. Louis-based Doane Marketing Reset has completed "The 1993 Genetically Enhanced Corn Seed Study," a shared-cost market research project. The study contains qualitative and quantitative assessments of com growers' perceptions about genetically enhanced corn seed. The study used focus groups and a mail survey to poll more than 800 growers who have at least 100 acres of corn. The study measures the present and long-term likelihood of trying herbicide-resistant/tolerant and insect-resistance corn seed. Also to be determined are the perceived benefits, draw-backs and key determinants for use. Corn growers are categorized by their relative level of innovativeness. Results will be available for clients at the end of October.
M.AI.D. drops connect charges for subscribers
New York-based Market Analysis & Information Database Inc. (M.A.I.D.) announced in July that it has dropped all connect charges for new and existing subscribers. The new policy will allow customers to go on-line, search and download tables of contents and report titles and otherwise browse without paying the standard change of $45 per hour. With each $10,000 subscription, M.A.I.D. is offering 100 free connection hours. Subscribers pay normal line fees on the news or market research information they need (8 cents per line and up for market research and 6 cents per line for news). M.A.I.D.'s Researchline database provides on-line market research, including publishers FIND/SVP, Packaged Facts, Euromonitor. Its news and business databases include Reuter Textline, Dun & Bradstreet and Moody's.
Customer Insight, TRW offer database marketing system
Customer Insight Co. Inc., Englewood, Colo., and TRW Target Marketing Services, Orange, Calif., have teamed up to offer database marketing systems for segmenting and targeting customers, analyzing trends and evaluating the effectiveness of marketing promotions. With the PC-based systems from Customer Insight, users can combine customer and prospect information with TRW demographic and financial data in an integrated custom marketing database system. Financial service businesses that purchase the database marketing system can add TRW data to their system any time and apply standard and custom risk and response models to their customer infor-mation. Under the agreement, TRW is licensed to market Customer Insight's products and the OnDesk system for updating databases and merging prospect and customer information on-site. The joint database marketing system includes hardware, software, training and support.
Product & Service Update - In-Depth
High customer satisfaction scores don't guarantee customer loyalty
by Gary Miller
Editor's note: Gary Miller is chairman, Aragon Consulting Group, St. Louis, Mo.
Many readers might be surprised to learn high customer satisfaction scores don't always guarantee customer loyalty. The paradox is that customer satisfaction studies are conducted to help ensure loyalty, yet these studies do not address customer loyalty at all.
Most customers like to have choices and will naturally seek alternative products, particularly if their current supplier doesn't readily offer choices. This is even more true if customers have no choices at all. Sooner or later, these customers will switch, regardless of their current level of "overall satisfaction." Everyone readily accepts the potential risk of a "dissatisfied" customer switching suppliers. Surprising to some - and regardless of how high "overall satisfaction" scores are - many "satisfied" customers switch for many of the same rational or emotional reasons as dissatisfied ones.
Some switch just because they can (particularly with a low-interest commodity or service, like gasoline or milk). Other satisfied customers simply like to "try new things." However, more often than not, a "satisfied" customer becomes aware of real or perceived superior competitive benefits, such as "value," "convenience," or "performance," which eventually affect repurchase intention.
The point is not that customer satisfaction is unimportant. In fact, high customer satisfaction is a minimum requirement of doing business in a competitive marketplace. As a result, the most aggressive customer-focused competitive marketers are moving beyond satisfaction to identify the components of customer loyalty, then evaluating, measuring and tracking them.
In a less competitive market like a regulated utility, where customer choice may be limited (until deregulation occurs), customers often have a narrow choice of energy alternatives (i.e., natural gas instead of electricity for water heating or cooking). Even the utility market is changing rapidly, however, and the more market-oriented energy companies are beginning to address this difference between customer satisfaction and customer loyalty.
And even in a monopoly business environment, customers exercise perhaps a more difficult choice: purchase more, purchase less or do not purchase at all.
Yet for those companies that continue to monitor only their customer's satisfaction scores, the shock of seeing a satisfied customer switch is felt all the way to the boardroom, particularly if executive compensation has been tied to achieving customer satisfaction measurement goals.
What is the best defense against succumbing to one of these shock waves? A better understanding of the relationship of customer satisfaction components to customer loyalty components on purchase intention and eventual behavior can help forecast customer loyalty.
St. Louis-based Aragon Consulting Group has studied the relationship between customer satisfaction and customer loyalty. Its studies indicate that up to 40% of a company's "satisfied" customers carry various levels of at-risk purchase intention.
This and other evidence indicates that purchase behavior has significantly more to do with the components that drive customer loyalty than those that drive customer satisfaction.
Aragon has developed a behavioral model that examines the components of customer satisfaction and the components of customer loyalty, called the customer satisfaction/customer loyalty (CS/CL) model. This proprietary model helps explain how external competitive factors relate to internal customer satisfaction components, which in turn affect the eventual purchase decision.
Each study requires that the model be tailored to fit the needs of the client. The model also can be customized to meet the diverse needs of different industries, different companies within a given industry, and different market segments served by a specific company.
Model works for business and consumer markets
The CS/CL model can be used to understand customer loyalty of business customers and consumers. The model's key components or constructs (like "customer satisfaction" and "relative perceived quality") are applicable to either market segment. What will differ are the specific facets, or "indicators," through which each construct is measured and analyzed.
Depending on a company's marketing programs, its business or consumer market segments may differ in many important respects. This is also true for customer loyalty. Business customers tend to have more diverse, complex needs and priorities, and more pragmatic and objective purchase motivations than consumers. Both business customers and consumers are confronted with a readily available, diverse range of alternative product sources.
Key elements of the CS/CL model
The CS/CL model considers interactions among a number of key components, or constructs. The model uses the constructs of customer loyalty, customer satisfaction, and product versus service definitions.
According to the CS/CL model, the loyalty of a company's customers is divided into customer intentions and customer behavior.
- Customer purchase/repurchase intentions are the extent to which a given customer intends, at a given point in time, to continue purchasing currently used products and services from a company rather than from competitors; and/or purchase future products and services from a company rather than from competitors.
- Customer loyalty behavior is the extent to which, over a given period, the customer actually continues purchasing products and services from a company rather than from competitors; and/or purchases future products and services from a company rather than from competitors.
The key point of this definition is that both components address the all-important question of customer purchase/repurchase behavior.
This distinction between customer loyalty as intention versus behavior is one of the model's key elements. A customer's intention to remain loyal to a company must precede the actual behavior. However, the intention does not guarantee that the actual behavior will result. Over time, research based on the CS/CL model produces an empirically based assessment of the specific ways in which customer intentions of loyalty influence the extent to which they actually remain loyal to a company.
The CS/CL model defines customer satisfaction with an emphasis on the specific ways in which customer satisfaction includes customer loyalty. Customer satisfaction is defined as the degree to which customers' perceptions of the company's product and service quality meets or exceeds their expectations.
For purposes of maximizing customer loyalty, the CS/CL model makes a con-sistent distinction between product and service. In some industries, the distinction between "product' and "service can be very vague. Overnight express delivery service, for example, could be called either a product or a service. The model defines "product" in terms of design, and "service" in terms of delivery.
The model defines "product" as design of a service, in terms of the performance that addresses customer's application needs and priorities; the functionality, or ease, with which customers can use the product; and the customer's perceived value the product delivers relative to its price. "Service" refers to the delivery of the service in terms of resolution of problems; ease of doing business; and billing and other administrative procedures involved in using the "product."
Understanding this distinction between product and service is essential to understanding the CS/CL model. Using this definition, for example, overnight express delivery service is now a "product," but the effectiveness with which it is delivered to customers concerns "service."
Research methodology
The CS/CL model is not a prefabricated design for customer satisfaction research, but a conceptual model of the general process through which a company achieves and maintains customer loyalty. The model's component constructs are potentially applicable to products and services in virtually any industry. The model provides a general design framework to guide research planning for a company's customer loyalty situation
At a general level, the research process design includes:
- initial qualitative research to identify potential indicators for customizing the model's 25-plus constructs;
- developmental quantitative research for final development of statistically valid and reliable construct indicators;
- initial quantitative surveys to provide statistically projectable planning information and set baselines against which future progress will be measured; and
- periodic "impact studies" to monitor customer loyalty levels and provide ongoing information for fine-tuning customer loyalty programs and initiatives.
As in the research process, the data analysis design is also customized within the CS/CL model. Generally, the model calls for various multivariate statistical techniques including:
- factor analysis and reliability analysis, for testing potential construct indicators and confirming the validity and reliability of the various construct measurement scales;
- multiple regression analysis and other similar multivariate correlation analysis techniques, used in the "casual modeling" that elaborates how the model's constructs function in each client's unique situation;
- "data-driven segmentation analysis," a combination of statistical procedures (including factor analysis, cluster analysis, cross tabulation and discriminant analysis), to identify "natural customer loyalty segments" in the client's market.