TITULO SUPLETORIO

More often than not, customer value is interpreted as a benefit—in most cases, as the overall benefit for the company from the entire business relationship. Customer value does not stem only from the profit generated by the customer (Günter & Helm, 2003). Rather, this value is built in many different ways, making the customer useful or profitable. For example, if the customer is a reference customer, he/she is a strategic entry customer and a driver of innovation. It can be argued that each of the enumerated benefits could count in sales, but could also be counted for different customers (Homburg & Wieseke, 2011).

In this study, benefit could be understood as the total increase of value which came into being through an activity. In this case, it refers to the additional benefit resulting from the customer segmentation. In contrast to effort this is defined as the monetary value-based consumption of goods, services or manpower. In this study, it refers to the additional effort resulting from the customer segmentation.

47

Customer value can be measured in terms of quantitative and/or qualitative values (Cornelsen, 2000). The acquisition of values in monetary terms is a lower level of quantitative variation. Monetary sizes could include, for example, gross or net incomes, as well as customer-related net values such as cash flows or contribution margin (DB). The main difficulty in gathering quantitative and monetary customer value lies in the fact that the data is from the present or the past. Assessments and forecasts of the duration of a business relationship and the resulting revenue are used to calculate CLV based on customer behaviour and other environmental factors. These also include operational and strategic decisions of the company (Reinartz & Kumar, 2000).

Quantitative and non-monetary customer value can be gathered in one, two, or three dimensions in the customer value cube. Monetary dimensional methods often rely on key performance indicators (KPIs) such as sales revenue or contribution margin. Non-monetary methods rely on variables like sales volume, required hours for customer service, or similar data. Apart from KPIs relating to the customers, the quantitative method to determine customer value also needs indicators that affect the company. This is especially true for the quantitative mapping of resources that must bring the company into the business relationship. After the acquisition of new customers, a complex process of integration occurs in the business processes (Kleinaltenkamp, Fließ, & Jacob, 1996). This process results in trade-offs between each customer and the company value, and a part of the customer value and resource consumption of the company are subtracted from each other. The cost of collecting these numbers makes it difficult to determine the quantitative customer value and does not justify economic usefulness.

Qualitative variables can be included in customer value calculation in different ways. The simplest way is to make a checklist of qualitative factors. It is easy and quick to compare different customers through such checklists.

Two-dimensional methods based on scoring models should be used to link the quantitative and qualitative data. With this kind of models, qualitative values are converted into

48

quantitative values. Another method is to use quantitative corrections on the qualitative data. This can be done, for example, by using risk premiums or discounts.

A basic problem with the inclusion of qualitative data is that it relates to the characteristics and behaviour of customers. It is also influenced by the customer’s environment and the conditions of the company. Another point is the greater diversity of factors, making them difficult to categorize. In addition, these factors are often subject to personal assessments. However, there is no reason to exclude qualitative data from customer value analysis (Freter, 2008).

2.3 Customer Relationship Management

Customer Relationship Management (CRM) describes the careful handling of detailed information on individual customers and all customer touch-points, including customer segmentation (Kotler, Keller, & Opresnik, 2015). The goal of CRM is to increase profitability and customer loyalty (Reinartz, Krafft, & Hoyer, 2004). Bruhn (2013) says that the goal is to control long-term customer relationships, which means that the pure product-orientation and the focus on acquiring new customers are replaced by a holistic approach (Bruhn, 2013). In addition to these, CRM has the following other goals according to Weis (2013):

• Maintaining customer relationships

• Increasing the purchase volume and share of wallet among individual customers • Optimization of customer relationships

• Increase in contribution margin • Acquiring interesting new customers • Optimizing cross-selling (Weis, 2013)

In addition to these goals, Riggert (2006) also considers the segmentation of target groups as one goal of CRM. That customer segmentation is a mandatory part of CRM is shown by Mack, Mayo & Khare (2005) in their CRM Diamond. A role of this segmentation in CRM is also to identify the customers who are the most profitable for the company in the long term (Wollenweber, 2012). As this doctoral thesis deals with the segmentation of customers in SMEs, the topic of CRM is dealt with more closely.

49

Figure: 4 CRM Customer diamond (Mack, Mayo, & Khare, 2005)

It is crucial for every company to attract customers, strengthen their loyalty, and recapture lost, attractive customers (Matzler, Stahl, & Hinterhuber, 2009). Strengthening customer loyalty is essential for companies in light of the general trend of decreasing customer loyalty (Kreutzer, 2013). In general, CRM can be seen as a tool for increasing loyalty and profitability. The use of information and communication technologies is the most powerful lever to increase profitability in sales. The focus here is on the mentioned CRM systems, which handle the analysis and tracking of existing customer contacts. With these systems, it is possible to carry out sales analyses, order probabilities, and success measurements of customers (Lippold, 2016).

Furthermore, CRM allows companies to offer customers very good services by effectively using the existing individual information effectively. Based on this existing information, customers can receive optimal services (Kotler, Keller, & Opresnik, 2015). Another reason CRM is particularly important is that the aggregate value of the customer base is an important driving force for the profitability of a company (Lanning, 1998). It can therefore be said that sustainable and strong working customer relationship management are essential for companies.

50