Attitudes Toward Firm and Competition: How Do They Matter for Customer Relationship Marketing Activities?

• Activity Number: 302
• Type: Topic Contributed
• Date/Time: Tuesday, August 4, 2009 : 10:30 AM to 12:20 PM
• Sponsor: Section on Statistics and Marketing
• Author(s): Rajkumar Venkatesan*+ and Reinartz Werner and Nalini Ravishanker
• Companies: University of Virginia and University of Cologne and University of Connecticut
• Keywords: Hierarchical Bayes ; Dynamic Linear Models ; Time Series Analysis ; Customer Relationship Marketing ; Pharmaceutical Marketing ; Qualitative Data

Abstract

We explore the mechanism through which customer attitudes influence the relationship between sales calls and sales. To address our objective, we develop a generalized dynamic model which combines over three years of sales call and customer sales histories for a multinational pharmaceutical firm, with survey-based customer attitude information that is available at irregular time intervals. We find that sales calls enhance the positive impact of, customer attitudes towards the focal firm, on sales, and diminish the negative impact of, customer attitudes towards the competition, on sales. Dominant competitors have a stronger negative effect on focal firm's sales than attitudes towards the firm and its weaker competitors. Customers with 1% better attitudes toward the focal firm than toward the competition require 7.5% less sales call effort to improve sales by 1%.