Why Customer Participation Matters Harvard Case Solution & Analysis

Most supervisors understand that listening to customers makes good business sense. Businesses have a great deal to gain from seeking and supporting customer contribution, which the authors define as getting customers to provide constructive suggestions and share their thoughts on how to shape merchandise and service offerings. However many companies just pay lip service to this idea. Rather than supporting customers to discuss their perspectives about its own products and the organization with supervisors, the writers found, firms have a tendency to concentrate on heartening customers to get mixed up in spreading positive word of mouth. Until now word of mouth is simply one kind of voluntary behaviour that customers engage in. In addition, it signals just what customers might be seeking or what folks on the exterior are saying, not how businesses can improve their offerings. The authors, who conducted surveys of customers too as interviews and roundtable discussions with senior executives in a number of sectors, found that both customer word of mouth and customer- to-business interactions are linked with a customer's propensity to buy more of a Business 's products and services. While not all satisfied customers become repeat buyers, supporting them to provide feedback and suggestions helps link them much more closely to the company.

 Businesses can even recapture deserting customers simply by contacting them and supporting them to participate. In addition, customer-to-business interaction is frequently more malleable than customer-to-customer word of mouth and more readily within the control of management. In a study of customers of an international bank, the authors found that customers who purchased the most were individuals who engaged and participated in much word-of-mouth behaviour. The consequences of the findings are that nurturing customer participation can be quite precious and that firms are better off emphasizing customer contribution over word of mouth (as opposed to the reverse), since it creates more customer "stickiness"(as in greater affection and dedication). Nonetheless, the writers say, the two strategies should be seen as two sides of a coin, working both internally and externally to build fiscal worth for companies.


This is just an excerpt. This case is about SALES & MARKETING

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