Understanding the drivers of customer value: The fusion of macro and micromodelling

Abstract

This paper proposes that consideration of both macro and micro levels of analysis reveals deep insights in to the impact of marketing activity on customer profitability. It contends that brand drivers, such as pricing and advertising, have a different impact on customer segments, and that understanding these differences will enable marketers to optimize their marketing strategy in a way that maximizes evaluation will have a distinct competitive advantage over those who do not. Therefore the aim of the paper is to test two null hypotheses: 1. that customer are homogenous, and 2. that marketing mix variables have the same effect on all customers. Using panel data from the hair colorants category the paper refutes both.