Customer Value Management Report: Strategies for Customer Retention

This report provides a comprehensive analysis of Customer Value Management (CVM), focusing on the case of Home Base, a British retailer. It defines key components enabling organizations to determine Customer Lifetime Value (CLV) and explains the concept's significance. The report explores factors influencing CLV, including long-term relationships, brand loyalty, rewards, customer service, and experience. It describes various marketing strategies like segmentation (demographic, psychographic, and behavioral) to maintain a customer base. Additionally, it examines B2B and B2C decision-making models and opportunities for customer value creation, along with techniques for analyzing customer loyalty. The report concludes with a synthesis of findings and recommendations for effective CVM practices, supported by relevant references.

CUSTOMER VALUE
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Define the components which enables organisation to determine its CLV'S...................1
P2 Define the concept of customers lifetime value to the enterprise.....................................2
P3 Define the factors which works as to influence customer lifetime values........................3
TASK 2............................................................................................................................................4
P4 Description on differed kind of marketing strategies that helps to maintain customer base.
................................................................................................................................................4
TASK 3............................................................................................................................................5
P5 B2B and B2C Decision Making models and opportunities for Customer Value Creation.. 5
P6 Analysing customer loyalty through different techniques................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Customer value management is one of the crucial aspects in terms to manage the all over
the activities. Thus, it can be said that it is one of the effective tool because it works as to connect
the connects the customer to the firm. With the help of this the buying behaviour of customer can
be analysed effectively. In this way present report will be inclusive of the activities of Home
Base, it is the retailer brand and situated in British. In this manner case study of firm will be
analysed in terms to determine the number of components of the firm. In addition to this it can be
seen that there are number of beneficial aspect to the customers as it is assistive in terms to create
the brand image in the market (Christopher, 2014). In addition to this Home base will be
inclusive of factors which will influence the process customer lifetime value. There are two
models as are B2B and B2C will be discussed in terms to determine the profitability and
productivity of the enterprise. Furthermore, there are number of tools which will be used by the
firm in term to enhance the value of product and services of the enterprise.
TASK 1
P1 Define the components which enables organisation to determine its CLV'S.
In this way it can be said that customer will always prefer to use those products which
will be available to them in affordable prices and in good rates. According to the present
scenario, it can be seen that Home base enterprise get succeed in terms to meet with the
expectation of customer by analysing their need in the market. In this way, firm need to
introduce innovative product in the market so that customer will get attracted towards it. It is
essential to understand the value of the customer in the market. By analysing the need and
demand of the customer the firm will get the effective performance (Goetsch and Davis, 2014).
IN the firm like Home base it is very essential to have long-term customer retention in the
market. To maintain the sustainability of the customer is one of the most effective strategies
planning. This kind of the process is helpful in term to meet with the expectation of the customer
in the market. In this way, firm has taken the various steps in term to find out the best market
research which will helpful to gain the maximum perceived value (Hammer, 2015). The
customer used to give their major consideration towards the things as brand, sales, corporate etc.
In this term it can be said that customer lifetime value is one of the crucial aspects which is
essential in order to determine the mind set level of the customer in the market.
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There are some merits in relation to the customer lifetime values and this all defined in the
following manner as are-
1. CLV is the one of the effective approach in terms to get provide help to the customer in
relation to have the retention in the market. If the firm is having the idea about the need
of the customer than they are able to satisfy their need effectively.
2. Innovation is the approach which very helpful in terms to gather the attraction of the
customer in the market (Homburg, Jozić and Kuehnl, 2014).
3. With the help of better marketing approach by the firm is able to have the idea about the
product and services in the market. They came to know about the current trends in
market. This kind of approach are helpful in term to maximising the operation function of
enterprise.
4. By having regular contract with the customer they are able to maintain the brand loyalty
of firm in the market. With the help of attractive features as discounts etc. will be
essential in terms to having long term sustainability of the firm in the market.
P2 Define the concept of customers lifetime value to the enterprise.
In the present competitive environment it essential to cope up with the rivalries of the
firm in the market. With the help of having better solution the enterprise can promotes its
services effective in the market. In this way, they need to adopt the number of the strategies as
are customer engagement, creations and understanding of the potential value of the buyers will
be helpful in term to manage and enhance the relationship among the customers available in the
market (Hsiao, Lee and Chen, 2015). In addition to this, it can be said that, CLV has supported
the firm in order to make differed kind of strategies which will be helpful in relation to create the
potential value of the customers. This kind of function also helpful in relation to enhance the
customer relationship effectively, hence, there are number of benefits of CLV are discussed in
the following manner as are-
Effective segmentation of customers- In this it can be said that it is one of important factor
which helps in effective customer identification. In this it is essential to target the customers and
find their potential value to the firm like Home-base (Keränen and Jalkala, 2014).
Proper forecasting- In this manager of Home base will create a better services or products by
having prediction of the future demand customer with the help of CLV. It is very assistive in the
enterprise to manage its optimum investment in assets.
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Re development of customers loyalty- In this term it can be said that customers continuous
value will be considered as to having improvement in the operation working capacity of Home
base. With the help of good identification of customers demands and value in the market will be
helpful to create the brand image of the firm in the market. In this it can be said that, with the
help of knowledge Home base can also take initiatives in order to redesign their loyalty plans to
make it more effective and appropriate (Leroi-Werelds and et.al., 2014).
Retention of customers- Under this it can be said that customer life tile creation will be helpful
in terms predicting vessel and it also essential to design program (Martinsuo and Killen, 2014).
In this Home base need to prioritize on which need of the customer can be identified, there is
need to take initiatives which helps to maintain and develop strategies and implementing this all
in order to gain the growth and development in the market.
P3 Define the factors which works as to influence customer lifetime values.
According to the present competitive business environment, Advertisers have confronted
a few difficulties in affecting the customers' improvement of powerful relationship with the goal
that they will buy the items and administrations. Advertisers of Home base likewise have
significant obligations with a specific end goal to expand the customers' lifetime esteems towards
their stores there are several factors that has give real effect on the loyalty of customers towards
expanding the lifetime accomplishment of big business (McMurrian and Matulich, 2016). There
some essential components have been recognized which gives a noteworthy effect on the
customers' lifetime esteems towards the Home base retail mark are as per the following:
 Long term relationships: According to advertisers, it an essential factor that gives an
understanding advancement long haul relationship by organizations with their customers
over the nations is each much essential as it positive effect by expanding Customers life
esteems towards the brand (Keränen and Jalkala, 2014). In Home base, supervisor needs
to utilize a suitable correspondence like Email , advanced ad and web based advertising
so they will stay in contact with their objective customers. Further, making of key
association with their customer;s business is ideal and most effortless path for Home base
to manufacture trust and make an existence time customers by alluding their business and
acquiring items and utilizing their administrations (Nyadzayo and Khajehzadeh, 2016).
 Brand loyalty: Loyalty of customers towards mark is likewise considered as essential
factor that impact the qualities and conduct of customers. It is likewise examined that
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behaviours' buyer additionally gets influenced with the brand dedication of big business
in showcase that decides reliability of its items in meeting the prerequisites (Nyadzayo
and Khajehzadeh, 2016). In introduce setting, Home base has created and actualized
different compelling business arrangements like advancement of inventive and quality
items through research and proving those items to the general population in low costs
which expands their image loyalty in showcase additionally gives a positive impact
customers lifetime esteems towards its items and administrations.
 Rewards and incentives- organizations utilize a wide range of offers to get a
consideration , yet they have to take an incentive plot which not catches their customers
eye but rather maintain them as well. Home base remunerate framework will expand their
CLV by advancing client devotion and expanding the benefit in long haul.
 Providing superior customer service:- Study has confirmed that 54% of individuals woul
change to another organization if an elective organization offers more choices with a
specific end goal to interface them (Nyadzayo and Khajehzadeh, 2016). In the event that
the Home construct is centring with respect to expanding the reliability and subsequently
their CLV, they have to oversee and sort out their correspondence channels.
 Customer experience: It is likewise viewed as that experience of customers towards the
results of Home base additionally influences their business CLV as customers having
positive experience will buy and items likewise impact the other to buy their items
simultaneous if the experience of customers is negative then they won't buy items in
future and furthermore impact other incentive towards the brand.
TASK 2
P4 Description on differed kind of marketing strategies that helps to maintain customer base.
Division is considered as essential process utilize partition substantial unit in to different
little units which additionally have pretty much comparable qualities. Segmentation of showcase
is considered as promoting idea utilized for bifurcating the entire market set up inside the littler
subsets comparing comparative of buyers with the comparative taste, request and preference.
Home base is the retail division association which can likewise utilize this kind of division for
influencing their clients to purchase their items and administrations which additionally tends to
ascend in client lifetime esteems (Pearson, 2016).
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Demographic: This is likewise critical procedure of market division which is utilized to separate
the market and clients on the premise of statistic variable like age, sex, conjugal status, pay,
religion and race and so forth (Martinsuo and Killen, 2014). Further, it is additionally considered
as a standout amongst the most widely recognized routine with regards to division which is
likewise helpful for Home base for breaking down the desire and estimations of buyer towards
the items in B2C advertising.
Psycho-graphic segmentation: Most viable and helpful methodology of market division which
infers organization needs to isolate their clients based on their identity, way of life and state of
mind. Organization in light of this procedure of division takes a shot at introduce that purchasing
behaviour of customer will be impacted by his identity and way of life. This will additionally
impact the acquiring choice of buyers to the immense degree.
Behaviour segmentation: From the powerful investigation, it has been distinguished that market
can likewise be portioned by the association on the premise customer;s' conduct, utilization,
preference, decisions and basic leadership.
TASK 3
P5 B2B and B2C Decision Making models and opportunities for Customer Value Creation.
Units for B2B decision making process are somewhat composite. They are compared to
consumer markets different ways. B2B decision are made by different employees or individuals
having the specializing in various fields. B2B buyers make their decisions through calculation of
budget percentage of the product and its strategic importance (Stark, 2015). It can be defined as
the group involved in negotiating the purchase of goods and services. According to Kotler
decision making unit involves buyers, decision makers, users, initiators and influencers. This
model has following steps:
 Analyzing the problem or opportunity: In this first step the business is needed to be
clearly identified as in what is the real problem the business is facing. On the other hand,
opportunities should be chased by the business (Stark, 2015).
 Collecting information: Business is established only after the accumulation of the
information.
 Evaluating the situation: Decision makers go through each and every alternative for the
resolution of the problem or opportunity.
 Creating options: At this stage innovative and creative options are considered.
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 Evaluation of alternatives: Here various factors such as efficiency, acceptability,
desirability, feasibility and suitability are considered.
 Selection of a chosen alternative: Here the best alternative is preferred which satisfies the
customers
 Taking action on decision: Finally, the plan is implemented which includes entire
organization’s decision, colleague’s support and accessibility of the resources.
B2C decision making model includes only one person i.e. consumer of that product. Decisions
can be made quickly if the product’s cost is relatively low and significant as compared to other
products. Consumers make prompt and quick decisions regarding these types of products.
Opportunities are created through commercialization industrialization. To understand the
customers and their success companies Homebase understood the business realities. Reason
behind effective is sales of basic items in a repetitive mode that develops a solution hierarchy
with standard elements. Customer value creation provides the opportunity to understand insight
of the customer and concerting that opportunity into an order. Loyal and secured customers
capture the firm value. Value quantification and prepositions comes under the section of
commercialization. For better compatibility with customers, organization has to regularly interact
with customers (Tantalo and Priem, 2016). During development of solution firms has to focus on
their leading customers which empowers their involvement. So, for maximum profits customers
and firm conduct customer value research which crosses many phases.
M2 Segmentation models in B2C or B2B and marketing intelligence for customer value creation
Customer segmentation models aim at targeting mass market and approaching
consumer’s priorities. Marketing efficiency, reaching innovative opportunities and maintain
loyal customers are necessary for long relationships. It can be described as a distribution of
customers into different subgroups on the basis of habits, gender, age etc. This process helps in
levelling their customers according to their needs and variety (). Customer segmentation can be
categorized according to demographic, psycho graphic, behavioral and geographical level.
Customers classified according to income, educational qualification and ethnicity falls in
demographic section. Evaluation of industry structure, business life cycle, platforms and social
class all these features are counted in psycho graphic level. These all segmentation comes under
B2B or B2C transactions.
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P6 Analysing customer loyalty through different techniques
Various types of techniques are used in maintain loyal customer relationship. Todays
where the technology is so advanced large amount of information is generated from social sites,
mobile devices., media, digital sensors and automatic sensors. But due to major challenges
business face problems in acquiring their customer base and specific data. Customer retention
and loyalty can are useful in calculating value which results in defining retention of that
customer for which investment has been done. (Terho and et.al., 2015) Loyalty not means
offering exciting programs and rewarding the customers but also gives effective brand advocates.
Retention permits company to actively reach the customer and confirms its stay with them.
However, repurchasing of a product is strong indicator of customer loyalty and satisfaction.
Many questions arise as will they purchase the same product from Home base company or not.
Customer relationship can be analysis provide profitability, personalization, customer
segmentation, monitoring of events. Complete data collection is done and then business
decisions are taken on the feedbacks. Most often customer relationship management makes
information available with the consumers (Weinstein and Pohlman, 2015). This clearly brings
out the scenario of purchasing power of customers. From this, business clears up the picture with
perspectives of customers. Branding of the products is also an important feature ton build up
customer loyalty. To create a strong customer base, communicating and encouraging advocacy
are very important factors for the development of organization. A positives' relation can be
maintained through the mentioned techniques:
Gathering personal data: Company can easily their segment of customers by collecting useful
information which in turn results in increase in sales and profitability of the products. Through
this step buying decisions Home-base are also affected and managed properly. Personal
information related to customers can be accumulated through technological ways like social
websites, mobile devices etc.
Allocation of Resources according to target: It is the most important factor that has to be kept in
mind by the company. Availability of the resources and its allocation at right period should be
managed by the team leaders of Home base. It has been estimated that almost profit generation
rises to 70 to 80 percent that comes from entire business and 20 to 30 percent is needed by the
enterprise. This feature helps in maintaining the cream layer of loyal and satisfied customers. It
is an important form of organizational structure.
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Updating and informing regularly: It is a natural phenomenon that a customer would repurchase
only if the information regarding products and services are sent regularly ( Xu, Peak and
Prybutok, 2015). Customers are attentive only to that company whose product’s review are
updated on time as the company has to be in the market and has to maintain its position with its
competitors. Home base is one of the company whose manager interacts with the customer on a
regular basis to increase its profitability and sales in the market. Home base focusses on quality
base products and effective service for its loyal customers.
CONCLUSION
Based on the above report it can be concluded that customer always seeks to have the
quality products in the reasonable price rates. It is one of the most significant factor which helps
to maintain the understanding with the customers. The present report has coverer the various
activities as are identification of potential value of customers, market segmentation which helps
to maintain customer base, factors which influence process of CLV's. The two model as are B2B
and B2C are also discussed in terms to determine the profitability and productivity of the
enterprise.
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Online
The 5 Benefits of Customer Lifetime Value, 2016. [Online]. Available
through:<https://synthesis.co.nz/5-benefits-customer-lifetime-value/>
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