Hotel Industry Crm

Acquisition versus Retention: Competitive guest Relationship Management Niladri B. Syam crowd D. Hess Department of Marketing, C.T. Bauer College of Business, University of Houston, 4800 Calhoun Road, Houston, TX 77204 713 743-4568 nbsyam@uh.edu jhess@uh.edu March 21, 2006 Acquisition versus Retention: Competitive Customer Relationship Management Abstract: Customer kindred management suggests that sellers recognise their most valuable guests and provide special products/services to them, both immediately in an effort to build a whizz of commitment to the firm (an accomplishment strategy) or just as they are thinking of leaving (a retention strategy). While a monopoliser profits most from an acquisition CRM strategy, assuming cost are held constant, the main result of our analytic model is that in a competitive marketplace one firm pursues an acquisition strategy and its rival uses a retention strategy. A lively ingredient in this finding is exogenous and identical customer grind rates. A retention strategy leads to a relatively smaller committed buyer club, so it leads to a straighten out windfall gain from customer labor. While a monopolist should choose acquisition CRM, when there is competition a firstborn mover should choose retention CRM.

The rival firm is hale to differentiate by choosing the less profitable acquisition strategy. Further, a retention strategy asks the customers to trust that special services impart be provided eventually. We find that both the firm pursuing a retention strategy and its customers are better off when the churn rate is lower, so this trust is rewarded. Finally, if acquisition CRM eliminates customer churn by creating early feelings of delight, then an all- acquisition outcome peck be the competitive equilibrium. Key Words: customer birth management; acquisition; retention; game theory. 2 1. Introduction Customer relationship management (CRM) can be defined as the affect of separating a firms... If you want to get a in full essay, order it on our website: Orderessay

Order your essay at Orderessay and get a 100% original and high-quality custom paper within the required time frame.