【文章內(nèi)容簡介】 ures Cadillac/Mercedes Remove the flaws Loyalty theme Partner with select few Loyalty drivers Percent repurchase and service Lexus developed a business system that emphasized the customer and removed the flaws customers experienced with petitive products. Customer Loyalty 26 Loyalty Automobile Repurchase Rates 45% 61% 78% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Industry Honda Lexus (Target) Repurchase Rate 7580% Lexus target repurchase rates are 50% higher than the industry. Customer Loyalty 27 Loyalty Automobile Repurchase Rates Lexus is approaching their goal with 68% of previous Lexus owners replacing their car with a new Lexus. Previous Vehicle New Vehicle Percentage 68 3 4 2 3 2 4 1 1 2 14 42 4 2 5 1 7 1 1 1 1 13 5 43 2 4 1 3 1 8 4 1 1 64 7 1 2 1 3 1 1 8 54 1 1 1 1 7 1 1 2 35 4 1 1 1 2 9 2 2 53 2 21 5 2 3 2 2 1 16 2 2 5 3 4 1 4 1 28 5 9 2 1 2 2 1 29 2 18 9 6 7 9 10 2 2 1 28 2 Lexus Mercedes BMW Lincoln Cadillac Acura Infiniti Jaguar Volvo Saab Audi Customer Loyalty 28 Loyalty 1 2 3 4 5 6 7 8 9 100%20%40%60%80%100%Service Retention (Percent)Ag e of V ehicleService Retention: Auto Dealer Lexus Honda Ford In addition, Lexus service retention is significantly higher than petitors. Customer Loyalty 29 Loyalty Strategic Approach to Loyalty Lifetime Customer Value Segmentation Lifecycle Needs Retention Impact Full Potential ?Not all customers are equal ?Segments differ in value based on –needs –preferences –behavior ?Capturing 100% share of relevant wallet requires –dynamic vs. static view of purchases ?tracking and projecting how needs evolve with lifestage ?Attrition rate must be used to discount expected cash flows ?Attrition differs by segment and lifestage ?Customer behaviors are changeable ?Value of customers can be increased through targeted value sharing incentives Properly capturing customer lifetime value has four requirements. Customer Loyalty 30 Loyalty Customer Lifecycle Profits (Insurance Example) Annual Profits ($300) ($200) ($100) $0 $100 $200 $300 $400 $500 Age 1824 Age 2534 1 2 3 4 5 6 7 8 9 10 Year Looking only at customer lifetime value, this insurer would conclude that both segments could be profitable. Customer Loyalty 31 Loyalty Customer Retention Rates Vary Widely by Age Segment (Insurance Example) 35% 36% 37% 41% 45% 52% 61% 70% 85% 9% 13% 17% 23% 28% 36% 45% 58% 72% 100% 0% 20% 40% 60% 80% 100% 1 2 3 4 5 6 7 8 9 10 Percent of Customers Retained 100% Year Age 1824 Age 2534 Cumulative Retention Rates However, the 1824 year old segment had much higher defection rates. Customer Loyalty 32 Loyalty (Customer NPV) Insurance Example $450 ($70) ($100) $0 $100 $200 $300 $400 $500 Age 1824 Age 2534 Net Present Value Unless the 1824 year old retention could be improved, they would not be a profitable segment to target. Customer Loyalty 33 Loyalty Root Cause Analysis: Why Customers Drop Out Convenience Service Employees Mistakes Processing delays Unavailability of exclusive service Speed of service (Long lines) Location of branch or ATM Hours (Inconvenient) Far Bad access Home Work Drive thru Parking Walk through Charges and fees Fees Fines Too high Not reversed Interest rates Versus the petition Minimum balance Unfriendly Problem solving Don39。t know me Takes too long Knowledge and demeanor Unprofessional Unknowledgeable Policy not waived in certain circumstances Concerns about check coverage Special treatment Safe deposit boxes Direct deposit Price Depositor root causes of defection Root cause is typically utilized to determine causes of defection. It, too, must be analyzed on a segmented basis. Customer Loyalty 34 Loyalty Different Customer Segments Defect for Different Reasons A segmented view will lead up to develop different strategies for best versus other customers. ABCDN um be r ofH ou s eho ld sSe gm en t Pro f itC on t r ib ut io n(50 %)0%50%100%150%Percent of TotalU ndis clos edO therW ai t t i m eLif e E v entCon v e ni en c eR at eS erv iceSe gm ent A O v er al lC us tom er B as e0%10%20%30%40%50%60%70%80%90%100%Reason for Defection as Percent of TotalCustomer Loyalty 35 Loyalty Strategic Approach to Loyalty Lifetime Customer Value Segmentation Lifecycle Needs Retention Impact Full Potential ?Not all customers are equal ?Segments differ in value based on –needs –preferences –behavior ?Capturing 100% share of relevant wallet requires –dynamic vs. static view of purchases ?tracking and projecting how needs evolve with lifestage ?Attrition rate must be used to discount expected cash flows ?Attrition differs by segment and lifestage ?Customer behaviors are changeable ?Value of customers can be increased through targeted value sharing incentives Properly capturing customer lifetime value has four requirements. Customer Loyalty 36 Loyalty Optimizing Customer Base All other customers strategy Best customer strategy ?Identify the most valuable customers to retain and perate ?Develop a robust value proposition to sustainably meet these customers needs better than petitors ?Find and attract more of these customers –internal candidates