Customer retention: A usage segmentation and customer value approach

Abstract

This paper discusses how companies should develop a customer retention focus and initiatives to maximise long-term customer value. Specifically, it examines the importance of customer retention; conceptualises an integrated customer value/retention model; and explains how usage segmentation can assist in relationship-building, retention strategy and profit planning. A brief case history of Fast Industries, a specialty plastics manufacturer, illustrates these ideas in practice. Implications for marketers and customer value managers are offered and research directions for scholars working in retention marketing are identified.