Timothy L. Keiningham

Determining the Return on Quality (ROQ)

Beginning in the late 1960s, U.S. manufacturers found themselves in intense global competition, particularly with Japanese firms. The effects were brutal. U.S. firms found that the quality of their products was woefully deficient relative to their Japanese competitors.

Relative Value and Customer Choice in Loan Decisions: An Application of the Wallet Allocation Rule

Abstract Purpose – This research applies the Wallet Allocation Rule (WAR) to provide marketing scholars and practitioners with a deeper understanding of the key drivers of loan selection and to estimate the relative value borrowers place on various attributes when selecting a loan provider among competitors. Design/methodology/approach – A survey of 642 credit union (CU) members from nine geographically dispersed USA CUs was conducted. WAR analysis was conducted to measure the relative value customers place on the selected variables within and across the financial institutions that were part of the borrowers’ consideration sets. Findings – WAR analysis revealed stark differences in the value of factors in the selection of a bank or a credit union for first mortgages, suggesting that WAR analysis is a useful tool for understanding the relative value of various attributes in the selection of one loan provider over another. Originality/value –This research provides a significant contribution to both the service literature and the scientific literature in general by providing a user-friendly and scientifically tested analysis tool to measure relative value distances of ranked data and providing additional evidence for the usefulness of WAR analysis to better understand relative customer satisfaction and its implications for consumer behavior and service marketing.

A roadmap for driving customer word-of-mouth

Managers seeking to manage customer word-of-mouth (WOM) behavior need to understand how different attitudinal drivers (e.g. satisfaction, positive and negative emotion, commitment, and self-brand connection) relate to a range of WOM behaviors. They also need to know how the effects of these drivers are moderated by customer characteristics (e.g. gender, age, income, country). The paper aims to discuss these issues.,To investigate these issues a built a large-scale multi-national database was created that includes attitudinal drivers, customer characteristics, and a full range of WOM behaviors, involving both the sending and receiving of both positive and negative WOM, with both strong and weak ties. The combination of sending-receiving, positive-negative and strong ties-weak ties results in a typology of eight distinct WOM behaviors. The investigation explores the drivers of those behaviors, and their moderators, using a hierarchical Bayes model in which all WOM behaviors are simultaneously modeled.,Among the many important findings uncovered are: the most effective way to drive all positive WOM behaviors is through maximizing affective commitment and positive emotions; minimizing negative emotions and ensuring that customers are satisfied lowers all negative WOM behaviors; all other attitudinal drivers have lower or even mixed effects on the different WOM behaviors; and customer characteristics can have a surprisingly large impact on how attitudes affect different WOM behaviors.,These findings have important managerial implications for promotion (which attitudes should be stimulated to produce the desired WOM behavior) and segmentation (how should marketing efforts change, based on segments defined by customer characteristics).,This research points to the myriad of factors that enhance positive and reduce negative word-of-mouth, and the importance of accounting for customer heterogeneity in assessing the likely impact of attitudinal drivers on word-of-mouth behaviors.

Profit maximization through customer relationship marketing : measurement, prediction and implementation

* Preface * Objectives of Customer Centric Approaches in Relationship Marketing (Lerzan Aksoy, Timothy L. Keiningham, and David Bejou) * Approaches to Customer Segmentation (Bruce Cooil, Lerzan Aksoy, and Timothy L. Keiningham) * Cross-Selling: Offering the Right Product to the Right Customer at the Right Time (Wagner A. Kamakura) * Understanding and Using Customer Loyalty and Customer Value (Edward Malthouse and Frank Mulhern) * Ignoring Your Best Customer? An Investigation of Customer Satisfaction, Customer Retention and Their Financial Impact (Baohong Sun, Ronald Wilcox, and Ting Zhu) * Customer Selection and Prioritization: The Optimal Resource Allocation Approach to Maximizing Customer Value (Namita Bhatnagar, Kiersten Maryott and David Bejou) * Index * Reference Notes Included

The Emotional Engagement Paradox

The purpose of this chapter is to examine how customers’ word of mouth (WOM) behaviors differ based upon emotional engagement (EE) levels towards the brands they use in different industry categories. This research contributes to the engagement literature by providing new insight into the relationship between EE and WOM behaviors. Specifically, we examine how customers’ WOM behaviors relate to different levels of positive and negative EE. We find that high self-brand connection among consumers that are high in both positive and negative EE generates the most online WOM. We refer to this surprising relationship as the Emotional Engagement Paradox.

Examining how context change foster service innovation

The purpose of this paper is to explore the role of context in service innovation by developing a conceptual framework that illuminates the key elements and trends in context change.,The paper adopts a service ecosystem lens for understanding how elements and trends in context foster service innovation. A conceptual framework identifying the role of context change in fostering service innovation is developed and justified through illustrations across industry settings of health, retailing, banking and education.,Context change is conceptualized by three trends – speed, granularity and liquification – that provide an analytical foundation for understanding how changes in the elements of context – space, resources and institutional arrangements – can foster service innovation. The analysis indicates emerging patterns across industries that allow exploring scenarios, grounded in emerging trends and developments in service innovation toward 2050.,Managers are offered a framework to guide service innovation and help them prepare for the future. The paper also suggests areas for further research.,The paper contributes with a new conceptualization of context change to identify and explain service innovation opportunities. Managers are offered a framework to guide service innovation and help them prepare for 2050. The paper also suggests areas for further service innovation research, zooming in on contextual changes to prepare for 2050.

Operationalizing Relative Customer Value

Abstract The construct of “value” has been central to explaining economic exchange since the time of Adam Smith. Despite its central importance, debate still exists as to what value entails. Absent a comprehensive understanding of value, researchers and managers have grappled with how to measure and manage value. Not surprisingly, absent a definition, no comprehensive, robust approach has emerged. We argue that value first must be viewed as a dual construct, i.e. value to the customer and value to the firm, that must be balanced to be sustainable. Given that value to the customer is clearly assessed as relative to competitive alternatives, we also argue that any robust measurement of value must account for competitive alternatives. We propose applying recent research on the use of relative metrics in linking to share of category spending as the foundation of assessing value to the customer (particularly since customers in most categories divide their spending across competing firms). This allows firms to assess the monetary value customers’ assign to their offerings, and to estimate changes in this value from different market actions. As value to the firm is ultimately about the net present value of customers’ economic contributions to the firm, this allows firms to balance value to the customer with value to the firm.