The long tail of loyalty: how personalized dialogue and customized rewards will change marketing forever

The long tail of loyalty: how personalized dialogue and customized rewards will change marketing... Purpose – This paper is aimed at describing how companies can find new opportunities for customer retention and lifetime value by applying the concepts of dialogue marketing, network‐building and relevant rewards. Design/methodology/approach – The paper cites the work of Chris Anderson, Editor‐in‐Chief of Wired Magazine , and the work of Italian economist Vilfredo Pareto. The paper explains how the works of these two men, and how programs put into place at two companies (Hewlett‐Packard and Rain Bird), have opened new vistas in customer retention. Findings – The study found that by applying specific marketing principles, companies can do a better job of retaining all customers, specifically those customers who are not in the top 20 percent of revenue‐producers. Practical implications – Most companies believe that 80 percent of their business comes from 20 percent of their customers. However, by applying specific marketing principles, companies can do a better job of retaining all customers, specifically those customers who are not in the top 20 percent of revenue‐producers. Originality/value – The paper takes a new look at an old principle (the 80‐20 Pareto Principle). http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Consumer Marketing Emerald Publishing

The long tail of loyalty: how personalized dialogue and customized rewards will change marketing forever

Journal of Consumer Marketing, Volume 23 (6): 5 – Oct 1, 2006

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Publisher
Emerald Publishing
Copyright
Copyright © 2006 Emerald Group Publishing Limited. All rights reserved.
ISSN
0736-3761
D.O.I.
10.1108/07363760610701904
Publisher site
See Article on Publisher Site

Abstract

Purpose – This paper is aimed at describing how companies can find new opportunities for customer retention and lifetime value by applying the concepts of dialogue marketing, network‐building and relevant rewards. Design/methodology/approach – The paper cites the work of Chris Anderson, Editor‐in‐Chief of Wired Magazine , and the work of Italian economist Vilfredo Pareto. The paper explains how the works of these two men, and how programs put into place at two companies (Hewlett‐Packard and Rain Bird), have opened new vistas in customer retention. Findings – The study found that by applying specific marketing principles, companies can do a better job of retaining all customers, specifically those customers who are not in the top 20 percent of revenue‐producers. Practical implications – Most companies believe that 80 percent of their business comes from 20 percent of their customers. However, by applying specific marketing principles, companies can do a better job of retaining all customers, specifically those customers who are not in the top 20 percent of revenue‐producers. Originality/value – The paper takes a new look at an old principle (the 80‐20 Pareto Principle).

Journal

Journal of Consumer MarketingEmerald Publishing

Published: Oct 1, 2006

Keywords: Customer loyalty; Consumer marketing; Customer retention; customer relations

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