Confidence in the exchange partners reliability and integrity (morgan and hunt 1994)
Two level of trust: young 2006
1 cognitive, calculative, and rational
2 emotional reasoning
Trust may: (efek dr kepercayann)
-reduce harmful conflict
-decrease transactional cost (biaya nego)
-promote adaptive organizational forms (network relationship)
-facilitate the rapid info of ad hoc work groups
-promote effective response to a crisis
A. Probity: focuses on honesty and integrity, for professional understanding and reputation
B. equity: fair mindedness, benevolence, caring, values, and sincerity as evidence
C. Reliability: firm having the ...view middle of the document...
The commitment is when there is relationship between the company and the customer, if it’s much useful to the company since it will gain more customer to a company.
Behavioral loyalty: A person who shops at the same place regularly
Positive: Behavioral loyalty is critically important for a business because it means customers are buying, and without buying there are no revenues. Negative: unhappy customers can be easily enticed to shop elsewhere by competitors, plus they can deter other potential customers through negative word of mouth.
Attitudinal loyalty a person who tells others how great a product is, or simply feels really positive about the brand him or herself internally
Positive: can add strength to already positive brands, produce word of mouth promotions invaluable in attracting other customers.
Negative: But if attitudinal customer don’t act behavioral / don’t buy products from a place where they put their mouth to, he or she contributes very little or no direct revenues to the business. A business with lots of people who like the brand but never spend money will not be in business for very long.
Acquisition cost: The cost of a business to acquire a new customer. The cost including cost of personal selling, commission payment, data collection cost, advertising and other communication, to introduce new customers to the company's products and services.
Retention cost: cost that is expand to keep a loyal customer and keep the longevity of the relationship. Existing customers are less expensive to retain than to recruit
Securing a customer’s loyalty over time produces superior profits
Front end cost: (cost to calculate the benefit of cust retention)
-the high cost of personal selling: cost in transportation, cust place are far away, other factors, limited amount of potential new cust in given period
-commission payment: can reduce fixed cost of personal selling although the variable cost of personal selling increase
-data collection cost: high cost, ex. Insurance company may not make a profit or service for one or more years into the lifetime of the contract.
-upfront supply of equipment: equipment and supply hired for long term where is written in a lifetime contract (cust retention)
-advertising and other communication expenditure: cost for adv to promote and create brand awareness (cust acquisition)
High front end cost industry: perusahaan yang butuh buat kluarin biaya...