CUSTOMER-CENTRICITY AND MARKETING PERFORMANCE OF DOMESTIC AIRLINE OPERATORS IN NIGERIA - Paul M. Nadube
International Journal of Management Science and Humanities Innovations,
Volume 5, Number 1, 2017
© 2017 McEvans Publications
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CUSTOMER-CENTRICITY AND MARKETING PERFORMANCE OF
DOMESTIC AIRLINE OPERATORS IN NIGERIA
Paul M. Nadube
Department of Marketing, Faculty of Management Sciences
Rivers State University of Science and Technology, Port-Harcourt, Rivers
State, Nigeria
ABSTRACT
Marketing strategists strategise their strategies to
enhance service quality and customer loyalty by using customer centric
marketing approach which emphasizes understanding and satisfying the needs, wants, and resources
of individual consumers and customers rather than those of mass markets or
market segments to enhance the fortune of the organisation and its
shareholders. The focus of this study
is to examine the
association between customer centricity and marketing
performance of domestic airline operators in Nigeria. The study administered 382
copies of structured questionnaire to obtain responses from both staff and
customers of domestic airline operators, out of which 357 copies were
retrieved. Thus 348 copies of research questionnaire were fit for use
representing 97.48% response rate. Analyzed was done using both descriptive and
inferential statistics aided by Statistical Package for Social Sciences version
17.0. Descriptive statistics were used to determine the mean and standard
deviation of the distribution, while Spearman Rank Order Correlation
Coefficient was used to ascertain the association between customer centricity
and the measures of marketing performance of domestic airline operators in
Nigeria. The result of the study shows that there is a significant association between
customer centricity and the two measures of marketing performance namely:
service quality and customer loyalty. It is recommended that efforts should be
made by domestic airline operators in Nigeria to encourage their employees to
be customer centric in order to know, understand and serve the individual
customer better.
Keywords: Customer centricity, service quality,
customer loyalty
INTRODUCTION
It
is common knowledge in marketing that the customer is the ultimate determinant
of product or company success. As authors suggest, the concept of integrated
marketing communication (IMC) begins with the consumer (Schultz 1998; Burnett
& Moriarty 1998; Shimp 2000 & Hansted & Hemanth 1999/2000). It is
the process and strategic approach to marketing from the consumer standpoint
rather than from a product or service standpoint. The concept starts with
understanding what consumers are interested in – what they want – then building
or adjusting the products or services to meet those needs. Subsequent to
understanding what the consumer wants, the marketer should guarantee that the
communications being developed are relevant to consumer (Schultz 1998).
Customers are increasingly being viewed as assets, with tangible equity
(Blattberg & Deighton 1996) and lifetime value (Pitt, Ewing & Berthon
2000). Lauterborn and Curran (2000) argued that it is important to recognise
the fact that “all customers are not created equal”. In recent years, customers
have become significantly more empowered. Yastrow (2000) identified three major
factors that caused this increase in customer power, namely a significant
increase in purchase options; improved access to objective, plentiful product
information; and consumers have become savvy, more self-reliant and sceptical,
trusting themselves more than sellers. Every IMC strategy should therefore
begin with an intense consideration of the customer.
This
approach goes far beyond basic demographics to uncover the customer segments
and consumer motivation that drive purchasing decisions. Advocates contend that
IMC (customer centricity) is the crucial first step in transitioning from
“primarily out-bound, product-driven communication to the more interactive,
consumer-oriented, and behaviour-oriented approaches of
International Journal of Management Science and Humanities Innovations,
Volume 5, Number 1, 2017
the
21st century” (Kitchen & Schultz 1999). A customer-centric
approach in IMC necessitates the discussion of two closely related and
undeniably important aspects, namely dialogue or two-way communication and the
consequent building of long-term relationships. Airline operators should move
towards communication efforts that are packed with information that can form
the basis of dialogue with the customer. In IMC all customer contacts, planned
and unplanned, take on the role of communicating the brand’s marketing message
to the customer. One of the latest trends in marketing is customer experience
management. This concept is defined as “the process of strategically managing a
customer’s entire experience with a product or a company” (Schmitt 2003). The
challenge now becomes to manage the ongoing stream of contacts, or “moments of
truth”, a company has with each customer as an integrated marketing dialogue.
Harbison (1997) posits that customer intimacy is one of the key components of
IMC and involves the tracking and managing of all customer moments. Marketers
need to regard each point of contact with a customer as an opportunity to
create a relationship and live up to the promises made while in that
relationship. Hence, this paper investigates the association between customer
centricity and marketing performance of domestic airline operator in Nigeria.
Next section discusses review of related literature.
LITERATURE REVIEW
Customer-centric marketing emphasizes understanding and satisfying the
needs, wants, and resources of individual consumers and customers rather than
those of mass markets or market segments. In customer-centric marketing,
marketers assess each customer individually and make a determination of
whether to serve that customer directly or via a third party. Also,
customer-centric marketers determine whether to create an offering that
customizes the product and/or some other element(s) of the marketing mix or
standardize the offering. Their actions are guided by analysis that seeks to
maximize the “effective efficiency” of marketing actions (Sheth & Sisodia 1995). Efficiency entails cost-benefit analysis
and seeks to maximize the output-to-input ratio of the marketing function for
individual customers. Effectiveness entails the enhancement of customer loyalty
and “share of wallet.” The objective of customer-centric marketing is to
maximize both efficiency and effectiveness simultaneously at a customer level.
Customer-centric marketing is distinct from one-to-one as well as
relationship marketing. Several authors have suggested that firms practice
one-to-one marketing through the use of mass customization (Gilmore & Pine 1997 & Pine, et al 1993). One-to-one marketing
focuses on the adaptation of product or offering, that is, product-centric
approach, and makes the product the starting point of planning process. In
contrast, customer-centricity focuses on the needs, wants, and resources of
customers as the starting point of the planning process.
It is important to draw a clear distinction between customer-centric
marketing and relationship marketing. For relationship marketing to be
effective, a customer-centric focus will need to emerge. While customer-centric
marketing may be practiced without relationship marketing. Transactional
customer-centric marketing occurs often in direct marketing situations wherein
the level of customer involvement and interest in an interactive relationship
is low. Also, as we will discuss later, customer-centric marketing may lead to
the outsourcing of customers.
The growth of customer-centric marketing leads to non-intuitive
consequences. First, whereas traditional marketing has been concerned with
demand management, customer-centric marketing will lead the marketing function
toward supply management. Second, traditional marketing practices emphasize the
acquisition of customers, while in contrast; customer-centric marketing will
lead firms toward outsourcing a subset of customers. Third, whereas traditional
firms and customers are institutionally separate with little interaction,
customer-centric marketing will lead to customers and firms co-creating
products, pricing, and distribution. Fourth, customer-centric marketing costs
will be more fixed cost and less variable cost. Finally, the vocabulary,
metrics, and organizations will evolve toward a customer focus rather than a
product focus or segment focus.
Customer-Centricity
and Marketing Performance of Domestic Paul M. Nadube
Airline Operators
in Nigeria
For example, Procter & Gamble renamed its channel sales organization
as “customer business development” in early 1999. The growth of
customer-centric marketing will change the vocabulary and metrics of marketing.
As firms become customer-centric, they will begin to identify with individual
customers and marketing terminology will increasingly be geared toward
individual customers. In addition to this focus on individual customers, we
expect other dramatic non intuitive changes. Customer-centric is now often used to mean a rifle-shot approach to
contact customers rather than the shotgun approach of traditional marketing.
The phrase Customer-focused could work equally well for most marketers. However,
customer-centric means something radically different from customer-focused.
Customer-centric means trying to somehow put yourself “inside the skin” of the
customer and see the situation from that perspective. IMC is a
customer-centric approach to marketing and stresses the use of multiple,
intersecting forms of media and technology to deliver its message. One of the
main points and attractiveness of IMC is that it is customer-centric.
Marketers, using databases and social media can now target and communicate with
their potential customers on a one-on-one basis. Wrap your communications
around the customers buying process. Develop communication activities that help
your customers move through each stage of the buying process easily. To do
this, you need to first think through the buying stages. Develop a plan to make
that process easy and implement that plan through your marketing communication
channels.
The
concept of marketing performance
Marketing
performance is the dependent variable of this study which is predicted by customer
centricity. Marketing performance measurement is part
of business performance measurement, a field that aims to support strategy
execution by creating insights into company performance. Marketing performance
measurement aims to assess “the
relationship between marketing activities and business performance”
(Clark & Ambler, 2001). Herein marketing relates to all activities
conducted to stimulate, facilitate, and accelerate sales or service (Lee et
al., 2000 & Alsem, 2007). Effective marketing practices result in success
with winning and retaining customer preferences, which supports the achievement
of long-term goals (Ambler & Kokkinaki, 2002). In this process marketing
should not be conceived as a separate function within firms, but as shared
responsibility of the business as a whole (Drucker, 1954 & Grönroos, 2007).
Marketing performance measurement focuses on assessing (1) how well customer
preferences are won and retained, (2) to which extent that contributed to the
stimulation, facilitation, and acceleration of sales, and (3) how that impacted
overall firm performance. Marketing performance evaluations can in these
processes contribute to the following four functions: (1) annual-plan control,
(2) profitability control, (3) efficiency control, and (4) strategic control.
The first and last function differ from each other in the sense that
annual-plan control attempts to evaluate if planned results are realized, while
strategic control strives to assess if the best market, product, and channel
opportunities are pursued (Kotler & Keller, 2006). Given the fact that a
firm’s survival depends on its capacity to create value, and value is defined
by customers (Day, 1990), marketing makes a fundamental contribution to long-term business success. In spite
of the importance of measuring marketing performance, there is little research
on the measures used to evaluate marketing performance and effectiveness till
now (Paulo et al, 2003). Ambler and Kokkinaki (1997) examined
seven marketing magazines and surprisingly found that only 11.5 per cent of the
articles analysed in their research dealt in one way or another with the
evaluation of marketing results. Hence, the Marketing Science Institute made
this question one of its research priorities since the year 2000 (Eusebio, et.
al., 2006). When considering marketing performance and success measures it is
noticed that there are many measures. Clark (1999) identifies about 20
measures, Ambler and Riley (2000) tested a total of 38 measures, Davidson
(1999) considers ten important measures of marketing effectiveness. However,
Clark (1999) suggests that we should make a better use of the existing measures
rather than formulating new ones. Recently, in an attempt to organize
performance measures, Kokkinaki and Ambler (1999) have summarized and
established six categories for marketing performance and success measures which
are:- (1) Financial measures
International Journal of Management Science and Humanities Innovations,
Volume 5, Number 1, 2017
(turnover,
contribution margin and profit), (2) Competitive market measures (market share,
advertising and promotional share), (3)
Consumer behaviour measures (consumer penetration, loyalty and customer gained). (4) Consumer
intermediate measures (brand recognition, satisfaction and purchase intention).
(5) Direct customer measures (distribution level, profitability of
intermediaries and service quality). (6) Innovativeness measures (products
launched and their revenue).
The evaluation of
marketing performance is recognized as a key task for management. However,
measuring the impact and the value of marketing has been a long standing
problem for senior marketing managers (Clark, 1999; Kokkinaki & Ambler,
1999; Marketing Week, 2001). In response to this pressure the Marketing Science
Institute (MSI) placed accountability and return on investment of marketing
expenditure at the top of its research priorities for 2008–10 (MSI 2008).
Financial measures such as sales and profit provide only partial indicators of
marketing performance due to their historical orientation and typically short
term horizon (Mizik & Jacobson 2008). Intangible, market-based assets
(nonfinancial measures), on the other hand, provide a richer understanding of
marketing performance, reconciling short-and long-term performance (Ambler
2003) as well as bridging marketing and shareholder value (Srivastava et al.
1998). It is necessary to pay special attention to the
consumer metrics, which is, regularly measuring the customer satisfaction
level, consumer loyalty, new customer gained, customer retained or customer
lost. For that managers have to give these consumer metrics priority in the way
they assess their marketing performance. In line with this understanding, service
quality and customer loyalty are used as measures of marketing performance.
Service Quality
Service
industry is playing an increasingly important role in the overall economies of
both developed and developing countries. Gronroos (1983) defined service as: “An activity or series of activities of more
or less intangibles nature that normally, but not necessarily, take place in
interactions between the customer and service employees and/or physical
resources or goods and/or systems of service provider, which are provided as
solutions to customer problems". Service is any primary or complementary activity that
does not directly produce a physical product - that is, the non-goods part of
the transaction between customer and provider" (Payne, 1993). Whereas Kotler
et al., (1999) defined service as any
activity or benefit that one party offers to another which is essentially
intangible and does not result in the ownership of anything, and it may or may
not be tied to a physical product
In today’s competitive
environment delivering high quality service is the key for a sustainable
competitive advantage. Global competition has become a prime reality for
today’s organisations and the aggressive environment that they operate in is
even more challenging and dynamic (Solis et al., 1998). In such a
competitive scenario only those companies which attempt to exceed their
consumers increasing expectations will succeed in the highly aggressive
environment that they operate in (Sinha & Ghosal, 1999). Kotler (2000)
argued “It is not enough to satisfy customers. We must delight them”. In the
light of this, organisations will succeed only by delivering valuable services
to their customers (Zineldin, 2005). The superiority of providing valuable
services is translated as quality in the customers’ eyes (Zineldin, 2006).
Brown et al. (2005) opined that the ‘moments-of truth’ are critical for
an organisation. Customers judge service quality relative to what they want by
comparing their perceptions of service experiences with their expectations of
what the service performance should be (Agundu & Nadube, 2016).
Quality in a service business has
become a measure of the extent to which the service provider meets the
customer’s expectations. Companies have found that in order to increase profits
and market share, they should pay much attention to service quality. Service
quality has become a key strategic factor for companies to differentiate their
products and services from other competitors by using service quality as a
process that customers evaluate. The search for service quality is with no
doubt the most important consumer trend of the new era, as consumers now are
Customer-Centricity
and Marketing Performance of Domestic Paul M. Nadube
Airline Operators
in Nigeria
demanding higher quality in products
and services than ever before. Delivering high service quality is a good
strategy for businesses to succeed.
Quality has been defined differently
by authors, Crosby, (1984), defined it as ‘conformance to requirements, Eaglier
and Langeard (1987) defined it as ‘one that satisfies the customer’.
Parasuraman et al. (1994) defined service quality as a “global judgment, or
attitude, relating to the superiority of the service. Service quality presents
‘the consumer’s overall impression of the relative inferiority / superiority of
the organization and its services”. Therefore, service quality is a key of
survival to all servicing companies. Maintaining service quality at certain level
and improving service quality must be life-time efforts to those companies who
desire life-time prosperity in customers’ heart (Cronin & Taylor, 1992).
Gronroos (1992) in his argument
defined service quality as a difference between customer expectations of ‘what
they want’ and their perceptions of ‘what they get’. Several authors have
argued about the importance of quality to service firms, and have demonstrated
its relationship with profits, increased markets share, return on investment,
customer satisfaction, and future purchasing intention. Thus, service quality
has become a significant differentiator and the most powerful competitive
weapon that organizations want to possess.
According to Parasuraman et al.,
(1988) service quality has three features which are unique to services:
intangibility, heterogeneity, and inseparability of production and consumption.
Therefore, they suggest that in the absence of objective measures, an
appropriate assessment of the service quality of a firm is to measure
consumers’ perceptions of quality. Production and consumption of many services
are inseparable; as a consequence quality is not designed at manufacturing
plants. Quality of services occurs during service delivery, during an
interaction between a client and the service firm.
SERVQUAL is an instrument developed
by Parasuraman et al., (1985), which centred on the notion of perceived
quality. It is based on the difference between consumers’ expectations and
perceptions of service. Exploratory research conducted in 1985 showed that
consumers judge service quality by using the same general criteria, regardless
of the type of service. Parasuraman et al. capture these criteria using a scale
composed of 22 items designed to load on five dimensions reflecting service
quality. The
SERVQUAL instrument has been the predominant method used to measure customers’
perceptions of service quality (Shahin, 2010). It has five generic dimensions
or factors which are stated as follows:
(1) Tangibles:
Physical facilities, equipment and appearance of personnel.
(2)
Reliability: Ability to perform the promised service dependably and accurately.
(3)
Responsiveness: Willingness to help customers and provide prompt service.
(4) Assurance:
Knowledge and courtesy of employees and their ability to inspire trust and
confidence; (Including competence, courtesy, credibility and security).
(5) Empathy:
Caring and individualized attention that the firm provides to its customers;
(Including access, communication, understanding the customer).
Each item is used twice:
first, to determine customer’s expectations about firms in general, within the
service category being investigated; second, to measure perceptions of
performance of a particular firm. These evaluations are collected using a seven-point
Likert scale. According to the authors, the service quality is then the
difference between Customer’s perceptions and expectations (Hudson, et al,
2002). SERVQUAL is a concise scale, easy to use by managers, and is now
referred to as a standard by other service researchers (Llosa, et al; 1998).
The scale has been replicated in many different service categories so as to
examine its general ability.
International Journal of Management Science and Humanities Innovations,
Volume 5, Number 1, 2017
Customer
Loyalty
Customer loyalty is one of
the most frequently addressed subjects in the marketing and service literature
(Kerr, 1999; Patterson & Smith, 2003; Eshghi et al 2007; Heskett & Sasser, 2010). The
subject has gained attention of service companies because of its importance to
the successful running of any business. Issues involving customer loyalty in
service organisations have drawn the attention of various researchers concerned
with finding the determinants of customer loyalty and their implications in
service industries. Customer loyalty is a crucial factor in companies’ growth
and their performance. Loyalty is linked with the repeat business. Thus, a
customer is loyal when he is frequently repurchasing a product or service from
a particular provider. Oliver defines loyalty as “A deeply held commitment to
re-buy or re-patronize a preferred product or service in the future despite
situational influences and marketing efforts having the potential to cause
switching behaviour” (Kotler, 2000). The perceived value from the product and
the service affects customer judgement about his/her satisfaction or loyalty
with the product or the service. The significance of customer loyalty is that
it is closely related to the company’s continued survival and to strong future
growth (Fornell, 1992 & Nadube, 2010).). According
to www.dictionary.com, loyalty is defined as the act of binding yourself
intellectually or emotionally to a course of action. The customers with the
greatest life time value are generally those who are not only loyal to your
products, but also loyal to your company. They are the ones who are willing to
promote your firm and act as references to other prospects. They run user
groups and fan clubs. They tattoo your company logo on their bodies. You know
you have a strong brand when a significant portion of your customer base
tattoos your logo on their chests and forearms. Loyal customers come back
frequently, buy often, recommend your company to others, and readily try out
new things. They may even come looking for products or services that you do not
offer.
But loyalty is more than
just behaviour. It is a fallacy to assume that a customer is loyal just because
they continue to buy from you. There are many reasons why a customer repeats
purchasing which have little to do with being really loyal. Consider the following: (1) there is a
contractual arrangement with your company (2) It takes too much effort or money
to change suppliers (3) You are low cost (4)
Relationship is with an employee and not with your company (5) Habits
are hard to break (6) May actually be
in the process of finding an alternative supplier. If any of the above is the
case, what do you think is likely to happen should a desirable competitor come
around and seek out your customer’s business? Loyalty is far more than repeat
business…
Loyalty can be defined as customers
continuing to believe that one organization’s products/services offer remains
their best option. It meets their value proposition whatever that may be. They take
that offer whenever faced with that purchasing decision. Moreover, loyalty
means hanging in there even when there may be a problem because the
organization has been good to them in the past and addresses issues when they
arise. It means that they do not seek out competitors and, when approached by
competitors, are not interested. It also means being willing to spend the time
and effort to communicate with the organization so as to build on past
successes and overcome any weaknesses. In a nutshell, loyalty means a customer
wants to do business with you and does (Patterson & Smith, 2003 p.9).
Ladder
of Loyalty: A
prospect becomes a purchaser, completed through a market or discrete exchange.
Clients emerge from several completed transactions but remain ambivalent
(undecided) towards the seller’s organisation. Supporters, despite what is
being passive about an organisation, are willing and able to enter into regular
transactions. Advocates represent the next and penultimate step. They not only
support an organisation and its products but actively recommend
International Journal of Management Science and Humanities Innovations,
Volume 5, Number 1, 2017
it to others by positive,
word-of-mouth communications. Partners, who represent the top rung of the ladder,
trust and support an organization just as it trusts and supports them.
 |
Figure1: Relationship Marketing Ladder of Loyalty
(Christopher et al, 2002).
The simplicity of the
loyalty ladder concept illustrates the important point that customers represent
different values to other organisations. That perceived value (or worth) may or
may not be reciprocated, thus establishing the basis for a variety and
complexity of different relationships. The next section discusses the methods
and findings of this study.
METHODS
This
study adopted the questionnaire and the interview techniques for purposes of
primary data collection. Accordingly, documentary sources constitute secondary
data for this study. While adopting the interview technique in collecting data,
we also had a face-to-face interaction with some of the respondents (staff and
customers of the five domestic airlines) to obtain first level information as
well as an in-depth knowledge of the problem to be investigated. Respondents
include ‘front line’ customer service staff (desk officers), supervisors,
station managers, air travellers and any other staff of the organisations that
indicated willingness to participate. Variables were measured
on a 5-point Likert scale developed for the purpose of this research. The scale
range shall be 1= strongly disagreed to 5= strongly agreed. The analysis of data was
done at three distinct levels namely: primary, secondary and tertiary levels of
analysis. Primary level of data analysis deals with descriptive statistics to
ascertain normality in distribution. The secondary level of data analysis
involved test for validity and reliability. The tertiary stage involved
hypotheses testing. For a more reliable analysis of data, the Statistical
Package for Social Sciences (SPSS) version 17.0 was used. The statistics used
were frequency tables, percentages, and the Spearman Rank Order Correlation.
The Spearman Rank Order Correlation was used to test the association between
variables.
RESULT
In
this section of the study, customer centricity is designated as CUSCENT. The analytical outcomes are herein presented
beginning from questionnaire administration and collection details in table 1:
Customer-Centricity
and Marketing Performance of Domestic Paul M. Nadube
Airline Operators
in Nigeria
Table 1: Questionnaire
Response Rate
|
Total copies
of Questionnaire Distributed
|
382
|
100
|
|
Total number
Retrieved
|
357
|
93.45
|
|
Uncompleted
copies of Questionnaire
|
9
|
2.35
|
|
Total number
of copies of Questionnaire used
|
348
|
91.1
|
Source: Research Data
As
shown in table 1, a total of 382 copies of the research questionnaire were
administered out of which 357 copies
were returned representing 93.45% of total copies of questionnaire distributed.
Nine (9) copies or 2.35% of the distributed questionnaire were uncompleted.
Thus the actual response rate was 97.48% which pertains to the 348 copies of
research questionnaire fit for use. Again, the process of analysis also
involved checking for cleaning (editing) and coding the data received from the
fieldwork.
Findings with Descriptive
Statistics
|
Table 2: Descriptive Statistics Customer
Centricity
|
|||||
|
|
N
|
Minimum
|
Maximum
|
Mean
|
Std. Deviation
|
|
CUSCENT
|
174
|
1.00
|
5.00
|
4.0761
|
.78065
|
|
Valid N (listwise)
|
174
|
|
|
|
|
Source: SPSS Output Version 17.0
Customer-centric marketing emphasizes
understanding and satisfying the needs, wants, and resources of individual
consumers and customers rather than those of mass markets or market segments.
In customer-centric marketing, marketers assess each customer individually and
make a determination of whether to serve that customer directly or via a third
party. The extent to which this exit among domestic airline operators in Nigeria
is seen with the high mean (x) of 4.1 which is far above the base mean value
(x) of 2.50. We find in this study that employees of domestic
airlines are committed to understanding the individual customers better; hence
they are customer-centric.
Table 3: Customer Centricity Statistics
|
|
|
CUSCENT1
|
CUSCENT2
|
CUSCENT3
|
CUSCENT4
|
|
N
|
Valid
|
174
|
174
|
174
|
174
|
|
Missing
|
0
|
0
|
0
|
0
|
|
|
Mean
|
4.1034
|
4.0460
|
4.0460
|
4.1092
|
|
|
Std.
Deviation
|
.86732
|
.89194
|
.87889
|
.82911
|
|
|
Skewness
|
-1.170
|
-1.277
|
-1.330
|
-1.438
|
|
|
Std.
Error of Skewness
|
.184
|
.184
|
.184
|
.184
|
|
|
Minimum
|
1.00
|
1.00
|
1.00
|
1.00
|
|
|
Maximum
|
5.00
|
5.00
|
5.00
|
5.00
|
|
Source: SPSS Output Version 17.0
International Journal of Management Science and Humanities Innovations,
Volume 5, Number 1, 2017
Association between
Customer Centricity and Marketing Performance
The
result of The Spearman Rank Order Coefficient for the association between customer
centricity and marketing performance is presented in Table 4. The table gives
the result of the statistical test of significance (p-value).
Table 4: Correlations Matrix for
Customer Centricity and Marketing Performance
|
|
|
|
CUSCENT
|
SERVQUAL
|
CUSLOYAL
|
|
Spearman's
rho
|
CUSCENT
|
Correlation
Coefficient
|
1.000
|
.736**
|
.622**
|
|
Sig.
(2-tailed)
|
.
|
.000
|
.000
|
||
|
N
|
174
|
174
|
174
|
Source:
Research Data and SPSS Output Version 17.0
The
result of the correlation in table 4 shows that there is a significant association between customer
centricity and service quality, and customer loyalty. Customer centricity is
significantly correlated to service quality (r 0.736, p = 0.000<0.01). Again
customer centricity is significantly correlated with customer loyalty (r =
0.622, p = 0.000 < 0.01). The association that exists between
customer centricity and measures of marketing performance is thus significant
at the 0.01 significance level. The result of the correlation in Table 4 shows
that there is a significant association between customer centricity and the two
measures of marketing performance namely: service quality, and customer
loyalty. The result shows that there is a significant association between customer
centricity and service quality, (r = 0.736, p = 0.000<0.01). The correlation
coefficient represents a high correlation indicating marked relationship. In
other words, customer centricity enhances service quality. When
organizations know and understand the individual customer’s well, customers are
served better. From the outcome of the survey, it is apparent
that there is significant association between customer centricity and
service quality. Table 4 also shows that there is a significant association between customer
centricity and customer loyalty, (r = 0.622, p = 0.000 < 0.01). The
correlation coefficient represents a moderate correlation signifying
substantial relationship. In other words, customers are loyal to organizations
that met and exceeded their expectations. From the foregoing we find
in this study that:
1.
In Nigeria,
as domestic
airline operators become customer centric (understanding the individual
customer); air travellers (customers) are assured of dependability of the promised service.
2.
When domestic airline operators in Nigeria are customer centric
(understanding the individual customer), travellers (customers) express trust
and confidence and therefore loyal.
Discussion
Significant Association
between Customer Centricity and Marketing Performance:
This study revealed that
employees of domestic airline operators in Nigeria are customer centric and
this enables them to understand their customers better. Sheth
et al., (2009), posit that customer-centricity
emphasizes understanding and satisfying the needs, wants, and resources of
individual consumers and customers rather than those of mass markets or market
segments. In customer-centric marketing, marketers assess each customer individually
and make a determination of whether to serve that customer directly or via
a third party. It focuses on the needs, wants, and resources of customers as
the starting point of the planning process. Duncan and Moriarty (1997)
noted that IMC is one of the “new-generation” marketing approaches being used
by companies to better focus their efforts in acquiring, retaining, and
developing relationships with customers and other stakeholders. Deshpande and Webster, (1989)
posit that putting customers and their needs at the centre of business thought
processes and actions are
Customer-Centricity
and Marketing Performance of Domestic Paul M. Nadube
Airline Operators
in Nigeria
fundamental aspects of marketing
philosophy. Customer-centricity is thus the way of
business based on trust and fairness that uses knowledge of customers to meet
their needs and achieve sustainable, valuable, long-term-relationships. It
was also found in this study that customer centricity (understanding the individual
customer) assured air travellers (customers) of dependability of the promised service. In other words,
customer centricity enhances service quality. When
organizations know and understand the individual customer’s well, customers are
served better. Domestic airlines’ employees served their customer better; hence it is apparent that there
is significant association between customer centricity and service quality.
Customer-centricity means trying to somehow put yourself “inside the skin” of
the customer and see the situation from their perspectives. Because domestic
airlines’ employees are proven to be customer centric, they are able to render
quality service by meeting the expectations of their customers. Solis et al.,
(1998) posit that in today’s competitive environment
delivering high quality service is the key for a sustainable competitive
advantage. Global competition has become a predominant reality for today’s
organizations and the aggressive environment that they operate in is even more
challenging and dynamic.
Parasuraman, et.al, (1985)
argued that quality in a service business has become a measure of the extent to
which the service provider meets the customer’s expectations. It is found that
in order to increase customer loyalty and profits, airline operators have to
pay much attention to service quality. Service quality has become a key
strategic factor for companies to differentiate their products and services
from other competitors by using service quality as a process that customers
evaluate. Many researchers suggest that customers access service quality by
comparing what they feel a seller should offer against the seller’s actual
service performance (Gronroos, 1982). The importance of quality to firms and
customers is unequivocal because of its benefits contributing to market share
and return on investment (Parasuraman, et al. 1985).
Again, it is also
found in this study that as domestic airline operators in Nigeria become
customer centric (understanding the individual customer); air travellers
(customers) express trust and confidence and are therefore loyal. In other
words, customers are loyal to organizations that met and exceeded their
expectations. Sheth and Sisodia (1995) posit that customer centricity is guided by analysis that seeks to maximize the “effective efficiency” of
marketing actions. Efficiency entails cost-benefit analysis and seeks to
maximize the output-to-input ratio of the marketing function for individual
customers. Effectiveness entails the enhancement of customer loyalty and “share
of wallet.” The objective of customer-centric marketing is to maximize both
efficiency and effectiveness simultaneously at the customer level. Having examined the association between customer
centricity and marketing performance, it is concluded that
1
As domestic airline operators in
Nigeria become customer centric,
service quality is significantly increased.
2
As domestic airline operators in
Nigeria become customer centric,
customer loyalty is significantly increased.
RECOMMENDATION:
In
view of the implications emanating from the study results, and conclusions
there from, it is recommended as follows that:
1 Efforts should be made by domestic airline operators in
Nigeria to encourage their employees
to be customer centric in order to know, understand and serve the individual customer better.
2 Employees should be
guided by the analysis that seeks to maximize the “effective efficiency” of marketing actions. Efficiency
entails cost-benefit analysis and seeks to maximize
the output-to-input ratio of the marketing function for individual customers. Effectiveness entails the
enhancement of customer loyalty and “share of wallet.”
The objective of customer-centric marketing should be to maximize both efficiency and effectiveness
simultaneously at the customer level.
International Journal of Management Science and Humanities Innovations,
Volume 5, Number 1, 2017
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