Investigation of the Influence of Customer Loyalty to Nokia’
Chapter 1
Introduction
1.0 Introduction
When one decides to enter the business field, there is an endless list of factors that he has to consider. The type of business, products that will be produced or raw materials, the workforce, location, capital and suppliers are just a few of the many other things that encompass a starting business. The size of the business doesn’t really matter for it to succeed. But of course, be it a small business or a large corporation, their objective is all the same, and that is to make a profit. This is where a fundamental factor called marketing comes in.
Customers are considered as one of the most important stakeholders of the business organisation. To be able to products and services effectively, various factors would have to be noted. One of which, is to know the needs and demands of the customers and satisfy these needs to make them more loyal to what the company is offering. Customers are said to be loyal when their buying behavior remains consistent to one type of item and completely ignore the pleas of competitors. Indeed, it is a known fact that customer loyalty is beneficial to businesses. There are a myriad of ways on how this loyalty can be achieved. Previous researches have concluded that satisfied consumers are more loyal to the product as compared to unsatisfied customers (Bailey & Schultz, 2000).
Obtaining the loyalty of the consumers however, is difficult as consumer Custom Dissertation Writingbehavior is affected by several other factors. Specifically, individual characteristics inherent of a customer, such as personal interests, lifestyle and economic reasons are among other factors that directly affect consumer behavior. Most scholars believed that having loyal customers lead to have a more competitive organisation. Hence, it is essential to determine the relationship of customer loyalty and organisational performance of a certain company. Primarily, the main goal of this dissertation is investigate the influence of customer loyalty to Nokia’s organisational performance. With the hype of telecommunication companies, it is important to know how customers affect their performance in the competitive market.
1.1 Background of the Study
1.1.1 Brief Overview of Nokia
Nokia is famous all over the world as a successful mobile phone manufacturer. It keeps being the leader in the mobile telecommunications relies on its plentiful experience, technology innovation and scientific marketing strategy. The concept of the company is "technology connecting people", which has been rooted in people’s mind deeply. The company emphasizes the consideration of humanity either in the decision of marketing strategy or in the management of the corporation.
With its historical roots in a wood-pulp mill originally founded by engineer Fredrik Idestam in southern Finland in 1865, the modern telecommunications giant has given Finland a high technological profile throughout the world (Huuderman, 2003). Kent (2004) related that in 1898, the company had acquired a factory for the production of galoshes and tires. Noam (1992) noted that fourteen years later it began to produce industrial cables. But the modern Nokia only came into being in 1967 when the Nokia Group of Companies was formed (Mendelson & Ziegler, 1999). It was then that its subsidiary, The Finnish Cable Company, began to develop its electronics department, along with its two other sister subsidiaries (Gruber, 2005). This cable company produced Finland’s computers in the late 1970s, leading to an extension into telecommunication that has made Nokia a household name (Sull, 2003)#p#分页标题#e#Custom Dissertation Writing.
Today, the company has long since moved from Nokia into a present headquarters at Espoo, Finland, and has over a third of the worldwide handset market, and a 50 per cent share of the European market (Haig, 2004). This is even more of an achievement if it was considered that the wireless handset market is regarded as the world’s largest consumer electronics industry, measured by units. Nokia’s ten largest markets are the United States, United Kingdom, Germany, China, United Arab Emirates, India, Italy, France, Brazil and Spain (Ahlback, 2006). The firm is all the time trying to maintain their position as the world’s dominant mobile phone manufacturer by constantly coming up with phones of the latest music, video, interactive gaming and a host of other software applications.
Nokia has been through many transformations since it was founded in 1865 as a pulp mill on the Nokia River in Southern Finland. Business experts say that Nokia has done a good job of combining technology and marketing to bring consumers along the continuum with new and fashionable mobile products (Jonash & Sommerlatte, 1999). However, they are still facing the challenge of being overpowered by very stiff competition in the mobile phone manufacturing industry. Nokia’s strategy of searching for opportunities in short-term markets may add up to continued long-term success. One of these factors is the context of customer loyalty.
1.1.2 Customer Loyalty
Organizations concerned with either survival or growth have for years considered customers as an important constituency. Much of the emphasis has been on the organization’s responsibility to the customer as key to customer satisfaction and retention and thus shareholder value. A study involving the agency element of responsibility is a good example of this focus. The study examined the relationship between how companies reacted to customer complaints and how customers felt about those reactions. The study found that the company reactions that held the company answerable for the problem yielded the most favorable pattern of customer reactions. More recently, the rise of the total quality management movement has heightened the importance of customers as stakeholders in their own right, shifting the focus from agency to obligation and broadening the concept of customer to include internal customers and suppliers (Auhagen & Bierhoff 2001).
Two dovetailing events have dramatically expanded how companies pursue customer loyalty. First, widespread use of the Internet has changed how customers expect relationship-building to work. No longer is marketing and sales information simply pushed toward the customer. Now, a company must also allow customers to pull the marketing information they want, when they want it, and complete the purchase process on their terms. Second, technology breakthroughs, particularly in the area of knowledge management, offer new and innovative ways to nurture customer relationships. Now a company's ability to thrive depends on capturing appropriate customer data from multiple points of customer contact such as a Website click stream, e-mail, telephone, fax, a call center, a kiosk or store, a reseller, or a direct sales force. When used correctly, this data enables the company to individualize its response to each customer interaction in what's often referred to as mass customization (Griffin & Herres 2002).#p#分页标题#e#
Custom Dissertation WritingA loyal customer has a specific bias about what to buy and from whom. His/Her purchase is not a random event. In addition, loyalty connotes a condition of some duration and requires that the act of purchase occur no less than twice (Griffin & Herres 2002). Finally, decision-making unit indicates that the decision to purchase may be made by more than one person. In such a case, a purchase decision can represent a compromise by an individual in the unit and can explain why he/she is sometimes not loyal to his/her most preferred product or service. Two important conditions associated with loyalty are customer retention and total share of customer. Customer retention describes the length of relationship with a customer. A customer retention rate is the percentage of customers who have met a specified number of repurchases over a finite period of time. Many companies operate under the false impression that a retained customer is automatically a loyal customer. Ideally, both customer retention and total share of customer are essential to loyalty (Griffin & Herres 2002). Customer loyalty can be acquired by customer satisfaction. By giving clients what they want they tend to be more willing to purchase a company’s products than its competitors. The succeeding discussion will be about customer satisfaction.
1.2 Purpose of the Study
This study will be conducted for the purpose of investigating the influence of customer loyalty with organisational performance of Nokia. This research aims to make use of consumer studies focusing on their loyalty to use and avail the products of Nokia and the reasons why they do so. .Custom Dissertation Writing Through this study, the researcher aims to show the significance of studying a business’ target market.
The aimed improvements of future Nokia products are geared not only towards better sales but higher customer patronage as well. If the outcome of the study will be successful, the results can add to the beneficial. This study will not only benefit other telecommunications company but other businesses as well. With the current economic crisis, this study will be very much relevant in improving marketing tactics by understanding and prioritizing the consumers and their respective preferences and needs.
1.3 Research Aims and Objectives
This study aims on investigating the impact of customer loyalty with Nokia’s organisational performance. Specifically this paper aim on achieving the following objectives:
1. To assess the current performance of Nokia through the perspective of their customers.
2. To determine the preferences of customers in a mobile phone.
3. To determine concepts and theories explaining the nature and extent of the relationship between customer loyalty and organisational performance.#p#分页标题#e#
4. To analyse the level of customer loyalty among the customers of Nokia that also comprise the independent variables of the study.
1.4 Research Questions
Telecommunications industry like Nokia is fast becoming one of the major contributors to the business sector. In this industry there are various trends which affect the performance of the company (Gruber, 2003). In this generation, the major trends in the environment of Nokia gravitate towards a global scale. With this, Nokia find them faced with the challenge of producing new and better products at reduced cost and market price. Aside from this, the globalization trend is also influencing the way Nokia operates in the global market.Custom Dissertation Writing Additionally, globalisation calls for the industry to design strategies which will ensure that the largest scope of innovations is taken hold of. With these shifts comes the important role that innovative activities play in the organisation’s management of its various aspects.
With these trends, Nokia should spark new passions. Innovation comes from the heart as well as the head. Companies that aren't afraid to innovate engage employee energies in a new and profoundly different way. When people are part of a cause and are not considered as just a cog in the wheel, their innovation quotient skyrockets. And above all, recognise that in today's economy, capital is plentiful; good ideas are scarce. Companies that look to incremental change to generate additional revenue will tend toward subsistence at best--eclipsed by companies that create an environment of innovation, spawning the new ideas that generate new wealth (Jonash, 2000). The environment where Nokia belongs monitor these trends through the use of the information technology system and the use of the internet to determine how these trends could impact their organisational performance and how they will be able to compete efficiently with these trends. However, the emergence of different mobile phone providers have affected the organisational competitiveness of industries like Nokia, This paper aims to answer the following queries::
1. What is the current condition of Nokia in terms of its business performance?
2. What are the preferences of customers in buying or considering a mobile phone?
3. By considering their preferences, are the respondents willing to buy Nokia phones than other phones?
4. Does customer loyalty affects organisational performance of Nokia?
1.5 Significance of the Study
The results of the study provides information and insight into the role played by customer loyalty in the performance of the organisation, especially in the context of the fierce competition with mobile phones companies making it crucial for Nokia to focus on building brand loyalty to prevent switching by focusing on quality enhancing activities. The study also benefits other telecommunication industries by providing an understanding of the impact of customer loyalty on the organisational performance and the components of operations of the company greatly influenced by customer loyalty. Results support strategic decision-making on telecommunications industry areas to prioritize to maximize loyalty among the customers of service firms. #p#分页标题#e#
1. 6 Scope and Limitations
The study focuses on the relationship between customer loyalty and organizational performance, with organisational performance comprising the dependent variable and the determinants of customer loyalty as the independent variables. By focusing on this relationship, an in-depth understanding of the correlation is achieved.
The empirical investigation is limited only to customers of Nokia and Nokia industry. Focusing on this single company enables the investigation to derive insight from this fierce competitive context so that a decision could mean the loss or maintenance of the company’s dominant position. The competitive context also supports the importance of quality in achieving customer loyalty.
Custom Dissertation Writing2.4 Industry Analysis
The telecommunications industry is fast becoming a major contributor to the business sector. Over the next years, consumers will see the launch of a new generation of mobile phones with enhanced features than what they have now. It is necessary for the maintenance of this fast-paced industry to become innovative in all the aspects of business activities that technology has to offer. Managers in the telecommunications industry need focus on how to best come up with an innovative culture that fosters discovery of something new to cater the increasingly diverse and more informed consumers. Additionally, globalisation calls for the industry to design strategies which will ensure that the largest scope of innovations is taken hold of. With these shifts comes the important role that innovative activities play in the organisation’s management of its various aspects.
Just as the look and feel of telecommunications machines has evolved in the past several years, the industry that makes them is experiencing a parallel dramatic change as well. Because the telecommunication gadgets sits at the intersection of three fast-moving industries: it is a communications device, computer and, with the addition of new media functions, consumer-electronics product, it is the bestselling device in all three categories (‘Battling for the palm of your Hand’, 2004). No wonder so many firms now want a piece of the action. The outward transformation of telecommunication devices is being reflected by an internal transformation of the industry in that manufacturing them used to be a difficult process that required expertise in an enormous range of areas, from the design of radio chips and software to the integration of electronic components and the styling of the case. Nowadays, when radio chips can be bought off the shelf (the software required in making a mobile phone work), manufacturing can be outsourced to an electronic-manufacturing services firm and a flourishing ecosystem has sprung up of small firms specialising in areas such as handset design, chip design, testing and software, barriers to entering the industry have fallen and the old vertical industry model has been undermined (‘Battling for the palm of your Hand’ 2004).#p#分页标题#e#
According to Miller & Morey (2004), the trends and regulations at the network operator level heavily influence the telecommunications industry. Despite their immense size, mobile phone providers are often at the mercy of international regulations and the demands of national operators, particularly in terms of industry standards. As s result, companies such as Nokia engage in significant and often skilful lobbying efforts at the European Union and other regulatory levels to create favourable standards that allow them a degree of certainty in their production cycles. Today, the telecommunications industry is affected by the global trends of increasingly mobile technology, with progressively greater importance placed on speed, data and multimedia advancements. Moreover, the industry is affected by a tendency to be overly optimistic about the implementation of this new technology, leading many firms to create an excess supply of equipment that the marker has not been quite ready to absorb. While Europe, the United States and Japan have been the primary targets for cellular phone growth during the 1990s telecommunications boom, and even during the 2000-2001 slowdown, cellular suppliers and operators are beginning to focus on emerging markets with higher growth potential-particularly in Asia, and more specifically in China.
According to many industry observers, one of the most impressive aspects of the telecommunications expansion was the fact that it occurred, for most of the part, with China remaining impenetrable to Western firms. With China’s entry into the World Trade Organisation (WTO), many in the industry are eagerly planning attempts to enter the world’s largest single market. And the implications for the telecommunications are vast. For example, in these unsaturated markets, many people will be first-time users, and the demands for equipment may lean toward simple, less expensive phones rather than the high-tech gadgets that are currently being produced for already developed sectors. As a result, for these firms, the biggest industry trend will be the difficult balancing act between maintaining production for their core developed markets while tailoring product lines that are more appropriate for new opportunities in relatively immature markets a business opportunity paradigm for telecommunications shows that new technologies, when achieving 10% market penetration inevitably invite imitators (Huuderman, 2003). These imitators invariably form the first layer of competition sparked by each successive innovation in telecommunications. In many cases, the instinct of established telecommunication firms like Nokia will be to absorb such innovators; whether innovators respond to these overtures or simply capitulate in the face of competition, the interaction of veteran and entrepreneurial companies define a business opportunity paradigm that generates new opportunities throughout the company. According to Gruber (2003), the business opportunity paradigm for domestic telecommunications represents a synthesis of three themes: (1) constant innovation leads to substitution; (2) large firms seek to pre-empt small firms through advantages of capital and economies of scale; (3) support industries will emerge to sustain the originating technology. The synthesis of these three themes provides a model by which some prognostication of future telecommunications development can be applied. The significance of these interconnecting themes is no less significant.#p#分页标题#e#
2.7 Understanding Brand Loyalty: Characteristics of a Strong and Effective Brand
In the society of consumption, individuals are consciously finding image and status by the self-image and lifestyle. It is said that brand image is something which is complicated to concretize as it only deals with impression of the target market. As mentioned, each and every organisation in the marketplace is trying to establish strong brands to compete with their rivals and sustain their competitive position and advantage. Accordingly, brand is defined as a term, name, design, symbol or any combination of these aspects, to determine a company products or services provided by the organisation. In addition, it is known that brands are the names used to differentiate the company products or services from the competitors (Kotler, 1997), like the brand of Nokia, Sony, Toyota, Nike, Adidas, IBM, Apple and others famous and competitive brands. In addition, brand is a corporate identity which provides intangible benefits aside from the usage by the products which makes it difficult for other company to imitate (Farquhar, 1990). This is the important role that the brand plays in marketing competition. Furthermore, many organisations recognised brands as one of the most precious assets which enable them to sustain their competitive advantage among their rival (Aaker, 1991). Hence, many companies try to establish brand equity for their own brand along with their efforts in using effective approach to maintain such equity.
In the competitive market environment, connecting with the target market is getting more complicated for different industries (McCombs, 2003). Accordingly, it takes an effective management and approaches to win over the skeptical target market which suggest that it is the moment to forget everything that has been learned regarding marketing and branding (Yalstrow, 2003). It is mentioned that it is the target market that is in control of improving the power of branding. In this regard, it is not the company who brand their target market, but the clients are the one which brands the company and their products and services offered.
Companies and other industries perceived that their brand have some personalities and characteristics in which clients and customers use as a channel for expressing themselves or to experience the predicted emotional benefits that differentiate a specific brand from another. The considered brand characteristics evolved through the different approaches used by the company. Nevertheless, studies on brand personality or characteristics and the representational utilization of brands has been confined to how target markets and audiences express themselves by purchasing the brands and has not given consideration on how the company perceived their brand characteristics (Keller, 1998). Furthermore, the characteristics of the brand can be noted with clear significance to corporate brands, products, services or countries. It can be said that clients perceived brands through the personality or traits of the human. According to Aaker (1997), the characteristics or personality of the brand refers to the set of human characteristics connected with a given brand. These include 5 constant dimensions and other traits (See Figure 1).#p#分页标题#e#
Figure 1
Dimensions of Brand Personality or Characteristics
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As shown in the figure above, the dimensions of brand characteristics include sincerity, competence, excitement, ruggedness and sophistication of the products or services. In this regard, the dimensions can be sued for operationalising the dimensions of the characteristics of the brand structure. Different studies have shown that the characteristic of a specific brand reveals their best characteristic that outperforms their rival brands (Kapferer, 1997). The distinctive brand characteristic provides the brand the ability to be exploited as a channel for self-expression, self-appraisals and self-definition for clients (Charade, Zinkhan & Lum, 1997). In addition, brand characteristic is a context linked with the multidimensional image of a specific brand (Keller, 1993). These imply that the characteristic of the brand will lead to brand image. The brand personality dimensions can be sued evaluate or measure various brand images. It is noted that the brand personality dimension is a well researched context to determine whether the brands is strong and effective (Austin et al, 2003, Phau & Lau, 2000). The most direct and simplest manner which has been recommended in measuring the strength and effectiveness of the brand image is to solicit responses to different questions which pertain to a specific human traits (Keller, 2003).
As mentioned above, one of the questions that should be answered in this paper is to determine the characteristics of a strong and effective brand. Different scholars have been able to establish some points to distinguish strong and effective brands. It can be said that a specific brand is strong and effective if such brand have the ability to influence the consumer purchase behaviour. According to Keller (1993), a brand is strong and effective if it has a significant impact on the purchase behaviour and decision making of the target market. In addition, strong brand is a brand which has the ability to retain on the memory and consciousness of the clients associated with their purchasing decision making.
Based on the brand concept of a target market, Dobbin (1990) regarded brand image as the subjective consciousness phenomenon. Dobbin (1990) have realized that it is not easy to understand how brand can retain on the memory and consciousness of the consumer but brand which has a strong image is forming through the reason and perceptual connotation of the consumer.
Furthermore, since the image of the brand does not physically exist in the products as well as in the entity, it is mentioned that a strong and effective brand has the ability to influenced and meld by its brand’s declaration of specialties of their content and by the individuals who accept the image throughout the purchase process. Hence, it is more essential consider the image of the brand than the consciousness appeared of fact to know whether the brand is strong and effective. #p#分页标题#e#
In the explanation made by Aaker (1991), he mentioned that the brand is typically linked with the company in a meaningful manners and its strength and effectiveness is reflected to different attitude of characteristics include the performance of the product, compare price, the interests of the customers, the behaviour of the clients, famous person/s, personality and life style, their competitors, product category, and others. Each of these characteristics has a different degree of intensity to influence the strengths and effectiveness of the brand image. In addition, it can also be noted that strength and effectiveness of brand image of the products or services offered by the company can also bee attributed with the associated brand name to ensure that the clients will purchase the products or services. The characteristics of a strong and effective brand can be divided to flexibility of the materials, the tangible and intangible feelings of the consumer and others.
A strong and effective brand is also considered as the one which has the ability to determine the products and services taken on their brands. It can be said that one of the characteristics of a strong and effective brand has the ability to appeal to its target market, and has the ability to become memorable among customers. Furthermore, a strong and effective brand also offers a unique image which separates it from other competing products or services.
It can be noted that a company with a strong brand enables a specific service or product to distinguish itself from its rivals. From the study conducted in which 101 companies have been surveyed, the participants of the study revealed that having a strong and effective brand are indeed important to the success of the company and products, specifically new launches (Kohli & McMahon 1997). In addition, it is said that strong and effective brand has the ability to make statements to other audience. Having a strong and effective brand enables the company to have a short-hand communication of what the organisation is and what it offers. Strong and effective brand create social acceptance and instant mutual recognition among their clients. By having a strong and effective brand image, organisations can have the ability to relay to relay to the clients their intended market expression for the products or services they offer. Most likely, target market tends to buy strong and quality or effective branded products and as time go by, this branding change use-value with image value.
Furthermore, it can be said that the key component of a strong brand is based on the initiation of an integrated approach in which industries are able to convey what they can offer relative to the competition, do what they are offering to the market and confirm it through consistent practice (CAI & Hobson, 2004). Accordingly, having a strong and effective brand and image to attain competitive advantage in the global market and to sustain its strengths and effectiveness, the management of the company must be able to give value to the capabilities of the brand (Nguyen and LeBlanc (2001). In an organisation, having a strong brand is attributed to having quality products or services. In this regard, the company must be able to provide a pleasant experience for target market to establish a strong and competitive brand image which may lead to their competitive advantage. It is said that the strength of the brand can be established once the company is able to consistently provide the target market quality products and services. #p#分页标题#e#
In a study conducted by Kim, Kim, and An (2003), they have stressed that a strong and effective brand image has the ability to meet the specific needs of the consumer and achieved consumer-based brand equity. Strong and effective brand image has the ability to influence the development of customer base of each of the company as well as the consequent enhancement in brand’s financial performance. One of the significant characteristics of a strong brand has the ability to meet the viewpoint of the clients. Furthermore, a strong brand and effective brand has the ability to convey and update their information on the current trends in market demand and has the ability to formulate a strategy to sustain its strengths and effectiveness through customer satisfaction. Strong brand has the ability to provide total customer satisfaction which was developed within the company from knowing that most of the target markets are trying to find products which have been used by other people based on its name alone.
Another characteristic of a strong and effective brand is its ability to reach the feelings that clients and other establishments have about the company with regards to the evaluation and assessment of other competing brands. In doing so, the management or the company handling the brands must be able to reach the clients through marketing activities like advertising and promotions. Having a strong and effective image means that the brand has the ability to maintain and sustain their competitive advantage. These brands has the ability to maintain such image in the marketplace since a negative change for a brand name may decrease in target market and consequently of revenue. It is said that it takes twice as hard to rebuild a good and effective brand image rather than initially building it.
Accordingly, there are various management approaches that the company may use to have a strong and effective brand image. In order to build a strong brand and effective image, the management who are tasked to build brand image should think of two things in planning a strategy. Such things are first is to sell the service of the company as a short-term goal and second is to build a strong brand image in the long run. In time of the process of promoting the brand name, the industry should apply integrated marketing communications to ensure the efficient introduction of the quality of service that the organization stands for (Clowe & Baack, 2007).
The strong and effective characteristic of the brand is also linked with the performance of the company. In this regard, to ensure the effectiveness of their brand image, the industry must be able to integrate all the available resources as well as recognize essential opportunities include combining a strong image with an external opportunity to establish competitive position and advantage of the brand. A comprehensive analysis of the characteristic of a strong brand image of the company should be integrated to solidify the connection of the brand with the target market. A strong and effective brand image has also the ability to consider various consumer behaviors to be able to introduce a consistent message with the target market (Engel, Blackwell & Miniard, 1995).#p#分页标题#e#
Another characteristic of the strong and effective brand image is its ability to effectively communicate with the target audience which starts on the organisation per se. The strength of the brand image can be determined through the values and principles of the industry as well as the extent that the company established its position.
A strong and competitive brand image in the company has various components which can be considered as tangible and intangible aspects. The tangible characteristics of a strong brand include the quality of the products or services identified with the brands, the different subcategories of the brand names in terms of the needs and demands of the clients, the brand accessibility; the marketing communications approach used by the company, company name and logo which represents the image of the brand and the staffs of the company whore are considered as the forerunners of the strong brand image (Asher, 1997).
On one hand, the intangible characteristics of the brand image includes the operational as well as the human resource policies of the company; the culture of the company which determines the beliefs as well as the practices of the industry personnel, the internal and external environment as well as the location of the organisation which include the accepted personal and business practices of the specific country where the brands are operated.
A strong and effective brand image also plays a crucial role in the perspective of consumer. A strong and effective brand image provides an assurance to the target market that the decision to purchase the product or service of a specific company in unfamiliar settings is worth it. A strong and effective brand image also has the capability of assuring the clients of the quality of the products and service when the clients have no previous experience of the company. The brand image perceived of the company also lessens the time spent looking for other alternative and substitute brands that could meet and the needs and of customer. A strong and effective brand is also perceived to determine the nature and extent of connection that the clients develops with the company based on the perceived openness of such company.
Furthermore, a strong and effective brand image can also be attributed with the point of view of the company. It has the ability to ushers the acceptability of change and developments within the industry including the introduction of new products and services as well as setting up of new brand categories under the initial brands. Moreover, a strong and effective brand has the ability to determine the appropriate price of the product or services offered. It can be said that a strong and effective brand is the one which consistently meets the needs of target market results to the return of target market and positive endorsements through word-of-mouth. A strong and effective brand not only attracts target market but also qualified staffs willing to work to maintaCustom Dissertation Writing#p#分页标题#e#in the strengths and effectiveness of the brand and lastly, strong and effective brand attracts favorable reviews from industry experts (Laforet & Saunders, 1999).
Chapter 3
Methodology
3.0 Research Methodology
3.1 Overview
Investigating the effect of customer loyalty with the organisational performance of Nokia involves the determination of the relationship of the independent variable customer loyalty with dependent variable organisational performance. The research would determine whether organisational performance has a relationship with customer loyalty and if so determine the extent of relationship and draw explanations for the extent of relationship or if not to find reasons for the lack of or weak relationship between an independent and the dependent variable.
Data requirements for the investigation involve secondary and primary data. Secondary data constitute information derived for a different and original purpose contained in books, journal studies, articles, papers and reports. Primary data comes from the first hand data collection made for the purpose of this study. Primary data collection in the study includes a survey of the loyal customers of Nokia. The survey would determine the perspectives of the company’s customers on the firm’s product quality and the degree of satisfaction as well as the degree of customer loyalty.
3.2 Methods
On one hand, the secondary sources of data will come from the company’s annual report, published articles, business journals, research papers, and related studies on quality of service and customer loyalty. On the other hand, primary research involved using the survey strategy, which allowed the gathering of a large amount of data from a sizeable population in an economic way (Saunders et al. 2003). The interview method provides a means of collecting insights or descriptions of experiences of the respondents on a given phenomenon or situation with answers expressed in words and analysed to derive insight and meaning (Saunders et al. 2003).
3.3 Approach
The study combines qualitative and quantitative approach. The qualitative approach is used to derive accounts and/or descriptions from people that can provide first hand information on the situation or phenomenon being studied (Saunders et al. 2003). The purpose of this approach is to draw in-depth information on a particular phenomenon to derive explanations, interpretations, and generalisations. The study uses qualitative approach to derive accounts and/or descriptions from the customers or subscribers of Nokia with regard to products quality that affects the extent of their loyalty to the company’s services and the company itself. The quantitative approach is used to draw measurable or quantifiable information on the phenomenon subject of the study (Saunders et al. 2003). This reason for gathering measurable data is to determine the relationship between or among variables through descriptive statistics (i.e. frequencies and comparative data) expressed in the tables and graphs. In the study, quantifiable data is collected to determine the existence of a relationship between customer loyalty and the organisational performance of Nokia. Information would provide insight into the aspects of customer loyalty that affects organisational performance the most. #p#分页标题#e#
3.4 Sample Participants
The population for this study will be composed of users and subscribers of Nokia mobile phones. To make sure that the sample for this study is representative of the population, the researcher will conduct a random sampling. The sample will be composed of 150 customers or consumers of Nokia.
3.5 Data Collection
3.5.1 Survey
The survey method applied in collecting primary data. Survey comprises a descriptive and non-experimental data collection method intended to draw information from a large sample. The survey method allowed the investigation to derive precise and impartial data to support conclusions and generalisations. This applies in studies requiring the determination and investigation of links or relationships between or among variables (Saunders et al. 2003). In the current study, the dependent variable is customer loyalty and the independent variables are Nokia’s organisational performance.
However, there are advantages and disadvantages in using the survey method so that, the disadvantages should be addressed to justify the method and ensure the reliability and validity of the data collection process. An advantage is the ability to establish a relationship among variables but a concurrent disadvantage is the failure of the method to indicate the direction of the relationship (Salant & Dillman 1994). In the current study, combining the quantitative and qualitative approaches led to the determination not only of the existence of a relationship but also the direction of the relationship and the explanation for this. Another advantage is the ability of the survey to draw data from many respondents but a related disadvantage is the heavy reliance of the method on self-reported data (Salant & Dillman 1994) by the respondents making it imperative for the researcher to apply ways of ensuring the willingness of the respondents to participate and freely share information to support research validity. In the study, respondents were contacted beforehand to seek their willingness to cooperate in the data collection process by explaining to them the purpose of the study and the need for their participation in the data collection process to ensure that answers given can validly support conclusions. In addition, combining survey with interview method also allows the company to derive explanations for answers. Still another advantage is the ability of the data collection method to derive a wide range of experiences and opinions on the subject of the study but this also involves the concurrent disadvantage of requiring a tedious process (Salant & Dillman 1994). The current study worked through a timetable that allotted sufficient time for data collection especially because of the need to draw willing customers and wait for replies to the questionnaire.
The survey used a questionnaire, as shown below, composed of two parts. The first part of questionnaire contained demographic information while the second part involved the survey proper. The questionnaire was administered to the customers of Nokia. In addition, another primary data collection method is interview with selected survey respondents conducted to derive insight on the responses. The data collection instrument will be a structured questionnaire that would be based on Likert scale. A Likert Scale is a rating scale that requires the subject to indicate his or her degree of agreement or disagreement with a statement. By rating scale we mean the scales that are usually used to measure attitudes towards an object, the degree to which an object contains a particular attribute, (Like or dislike), toward some attribute, or the importance attached to an attribute. The equivalent weights for the answers would be:#p#分页标题#e#
Range Interpretation
4.50 – 5.00 Strongly Agree
3.50 – 4.00 Agree
2.50 – 3.49 Uncertain
1.50 – 2.49 Disagree
0.00 – 1.49 Strongly Disagree
The use of the questionnaire would provide the project owner the ability to test the views and attitudes of the respondents. The distribution and collation methods used to manage the questionnaire process would ensure anonymity. For validation purposes, the researcher will initially submit a sample of the set of survey questionnaires for approval; the survey will be initially conducted to five respondents. After the questions are answered, the researcher will ask the respondents for any suggestions or any necessary corrections to ensure further improvement and validity of the instrument. The researcher will again examine the content of the survey questions/statements to find out the reliability of the instrument. Afterwards, the researchers will exclude irrelevant questions and changed words that would be deemed difficult by the respondents, to much simpler terms. The researcher will exclude the five respondents who will be initially used for the validation of the instrument. The researcher will then tallies score and tabulate all the responses in the provided questionnaire.
3.6 Ethical Considerations
The ethical considerations arising in the investigation covers the consent of the respondents to the data collection process and the confidentiality of the information given by the respondents. This could raise concerns on the part of the respondents. In order to allay this concern, the questionnaire includes a letter explaining how their information was obtained, the extent of information obtained on them, the researcher, the purpose of the study, the participation expected from them, and an assurance that personal information obtained would be kept in confidence and used only for the purposes of the study. Answering and mailing back the questionnaires indicates consent and voluntary participation to the data collection process. In addition, protecting the confidentiality of identities of the respondents and the information given would also be assured the respondents during the interview process. These steps are necessary to ensure that the respondents knowingly and willingly extend their cooperation and participation to the research process.
3.7 Data Processing
The method of data analysis for the qualitative data is deriving and interpreting meaning and deriving implications in relation to the aim and objectives of the study. Results and analysis are presented in text discussions and graphs or charts to facilitate readability. In relation to the quantitative data, correlation analysis determines the existence of a relationship between the dependent and the various independent variables.
3.7 Statistical Treatment of the Data#p#分页标题#e#
After the collection of information from self-administered questionnaire, and related studies, the researcher collated all the data. The statistical analysis for the information from semi-structure questionnaire was conducted using Microsoft Excel where the data is tabulated, graphed, and evaluated. The testing of the level of significance was conducted using the Statistical Package for Social Sciences (SPSS) and tabulated in the Excel files. The SPSS is the standard software in conducting statistical analysis.
Percentage – to determine the magnitude of the responses to the questionnaire:
Where: n = number of responses
N = total number of respondents
Weighted Mean:
where: f – weight given to each response
x – number of responses
xt – total number of responses
To evaluate the information gathered, the percentage analysis and mean analysis are used.
Chapter 4
Data Presentation and Analysis
In this chapter, the data gathered from Nokia’s loyal subscriber and customers in relation to the research objectives. This chapter discusses the result of the survey questionnaire responded by 150 participants. Before the initiation of the research study the significance, rationale and purpose of the study were provided respondents. Furthermore, the respondents have also been given the assurance that all the data they will give are used for the purpose of the research and the identities of the respondents will be confidential. All questions asked in the survey questionnaire pertain only to the current situations about customer loyalty and Nokia’s organisational performance. For a clearer presentation, the findings of the study are divided into sections. The first part summarizes the demographic profiles of the respondents and the second part provides the insights of the respondents regarding Nokia’s products or services. The second part would be the determination of the correlation analysis.
4.1 Demographic Profile
This part of the paper discuses the demographic profile of the chosen customers of Nokia. The description of the respondents includes their age, gender, and marital status, highest education, and occupation.
Figure 1
Gender of respondents
Figure 1 present the distribution of the gender of the respondents who participated in the study. The sample populations’ gender depicts an uneven distribution of the genders. In this case, 89 (59%) of the respondents are male and 61 (41%) were female. This indicates that among the sample population, there are more females who are loyal in subscribing or using Nokia mobile phones than male.
Figure 2
Age of Respondents
The figure above displays the distribution of the respondents according to their age. Out of 150 respondents, it shows that most of the loyal customers of Nokia belong to 39-above (25%). These means that majority of adults prefer to buy Nokia brands than any other brands. On one hand, 75 (72%) are young adults belonging to from 18-below to 28 years of age. This can indicate that Nokia brands can be attractive to any age of customers.#p#分页标题#e#
Marital Status
Figure 3
Figure 3 provide the data for the marital status of the respondents who participated in the study. Herein, it shows that 98 (65%) were single and only 35% of the total population are married. The reason can be attributed to the age of the respondents who mostly belongs to teenagers and young adults.
4.2 Perception of the Respondents
This part of the study discusses the analysis and the perception of the respondents based on the Likert scale mentioned in the previous chapter. Herein, it should be noted that the customers of Nokia were given a set of attitude statements through the survey-questionnaires to express their perception on whether they agree or disagree with the given statements through the use of five-point Likert scale. With this, 5 represent a strong agreement and 1 for strong disagreement.
Table 1
Assessment of the Loyalty of the Nokia Customers
Statements 5 4 3 2 1 Weighted Mean Interpretation
1. I am a loyal customer of Nokia. 128 22 0 0 0 4.85 Strongly Agree
2. I can see myself as a subscriber or user of Nokia mobile phones in the next 5 years. 98 52 0 0 0 4.65 Strongly Agree
3. I will refer Nokia mobile phones to people in my social circle. 118 32 0 0 0 4.79 Strongly Agree
4. I will switch to another mobile phone brand in the future. 31 21 20 52 26 2.86 Uncertain
5. I believe that Nokia mobile phones provide all the things that I need in a cellular phone. 131 19 0 0 0 4.87 Strongly Agree
The table above provides the perception of the respondents on measuring or assessing their how loyal they are with Nokia mobile phones. Herein, analysis revealed that the customers strongly agreed on the given statements. The respondents strongly agreed that they are loyal customers of Nokia. In addition, they strongly agreed that they will be a user of Nokia mobile phones in the next 5 years. Most of the respondents strongly agreed that they will refer Nokia to people in their social circle. Furthermore, the data have revealed that Nokia Mobile phones provide all the things that I need in a cellular phone. The respondent of these study are uncertain on the idea of switching to other brands in the future.
Table 2
Image/Features Attribute of Nokia Mobile Phones
Statements 5 4 3 2 1 Weighted Mean Interpretation
1. I am using Nokia mobile phones because of its overall appearance 89 61 0 0 0 4.59 Strongly Agree
2. I am using Nokia mobile phones because of its brand 131 19 0 0 0 4.87 Strongly Agree
3. I prefer Nokia phones because of its up to date features. 118 32 0 0 0 4.79 Strongly Agree#p#分页标题#e#
4. I prefer Nokia phones because of its affordable prices 121 29 0 0 0 4.81 Strongly Agree
5. I prefer Nokia phones because it is user friendly 126 24 0 0 0 4.84 Strongly Agree
6. I buy Nokia phones because it is more durable than other phones. 69 25 0 25 31 3.51 Agree
7. I buy Nokia phones because of its overall quality 113 30 0 2 5 4.63 Strongly Agree
The table above shows the distribution of the respondents with regards to their perception on the image/features attribute of Nokia mobile phones. Majority of the respondents strongly agreed to the statement given in the survey-questionnaire. In the analysis it shows that the respondents strongly agreed that they use nokia mobile phones because of its overall appearance, brands, up to date features, affordable prices and its overall quality. On one hand, the respondents only agreed that they use mobile phones of Nokia because of its durability.
Table 3
Perception about the Organizational Performance of Nokia
Statements 5 4 3 2 1 Weighted Mean Interpretation
1. The company has increased its market share through the loyalty of the customers 98 52 0 0 0 4.65 Strongly Agree
2. Having loyal customers of Nokia enables the company to understand and reach out to the needs of its customers. 118 32 0 0 0 4.79 Strongly Agree
3. Having loyal customers contributes to the company in terms of customer satisfaction and sales increase. 89 61 0 0 0 4.59 Strongly Agree
4. Nokia’s performance has become more competitive because of their loyal customers. 121 29 0 0 0 4.81 Strongly Agree
5. Nokia brand has achieved competitive market position because of the loyal customers. 126 24 0 0 0 4.84 Strongly Agree
The table above presents the perception of the respondents with regards to the overall performance of Nokia. Herein, the study shows that most of the respondents strongly agreed with the given statements. The respondents strongly agreed that because of the customer loyalty, the company has increased its market share through the loyalty of the customers. In addition, they strongly agreed that having loyal customers of Nokia enables the company to understand and reach out to the needs of its customers, contributes to the company in terms of customer satisfaction and sales increase. Lastly, they also strongly agreed that the performance of Nokia has become more competitive of their loyal customers and the brand of nokia has achieved competitive market position because of the loyal customers.
4.3 Correlation Study
In order to identify the relationship between customer loyalty and Nokia’s organisational performance, the use of correlation statistic was considered. On one hand, the strength of the linear association between these two aspects is quantified by the correlation coefficient.#p#分页标题#e#
Given a set of observations (x1, y1), (x2,y2),...(xn,yn), the formula for computing the correlation coefficient is given by:
Where:
= Correlation between X and Y
= Sum of Variable X
= Sum of Variable Y
= Sum of the product X and Y
N= Number of Cases
= Sum of squared X score
= Sum of squared Y score
In addition, the correlation coefficient always takes a value that ranges from -1 and 1, with 1 or -1 imply perfect correlation (all points would lay along a straight line in this case). A positive correlation implies a positive association between the variables (increasing values in one variable correspond to increasing values in the other variable), while a negative correlation signifies a negative relation between the variables (increasing values is one variable correspond to decreasing values in the other variable). A correlation value close to 0 indicates that there is no association between the given variables.
Since the formula for calculating the correlation coefficient standardizes the variables, changes in scale or units of measurement will not affect its value. For this reason, the correlation coefficient is often more useful than a graphical depiction in determining the strength of the association between two variables.
In addition, if the correlation index of the computed rxy is not perfect, then it is suggested to use the following categorization:
rxy Indication
between ± 0.80 to ± 1.00 : High Correlation
between ± 0.60 to ± 0.79 : Moderately High Correlation
between ± 0.40 to ± 0.59 : Moderate Correlation
between ± 0.20 to ± 0.39 : Low Correlation
between ± 0.01 to ± 0.19 : Negligible Correlation
Analysis
Descriptive Statistics
The descriptive analysis has shown the weighted mean of the integrated mean of the perception of respondents in the customer loyalty assessment and organizational performance of Nokia.
**Correlation is significant at the 0.01 level (2-tailed)
The correlations table displays Pearson correlation coefficients, significance values, and the number of cases with non-missing values. Pearson correlation coefficients assume the data are normally distributed. The Pearson correlation coefficient is a measure of linear association between two variables.
Basically, the values of the correlation coefficient range from -1 to 1. The sign of the correlation coefficient indicates the direction of the relationship (positive or negative). The absolute value of the coefficient of correlation signifies the strength, with larger absolute values showing stronger relationships. The correlation coefficients on the main diagonal are always 1.0, because each variable has a perfect positive linear relationship with itself. Correlations above the main diagonal are a mirror image of those below.#p#分页标题#e#
In our data, the correlation coefficient for customer loyalty (independent) and organizational performance of Nokia (dependent) is 0.925. Since 0.925 is relatively close to 1 or -1 this indicates that effective customer loyalty (independent) and is highly correlated with attaining competitive organisational performance (dependent).
The significance of each correlation coefficient is also displayed in the correlation table. The significance level (or p-value) is the probability of obtaining results as extreme as the one observed. If the significance level is very small (less than 0.05) then the correlation is significant and the two variables are linearly related. If the significance level is relatively large, for example, 0.50, then the correlation is not significant and the two variables are not linearly related.
Business Analysis of Nokia
Through the use of SWOT analysis, the current condition of the company will be analysed.
Strengths. As mobile manufacturers increasingly compete on price, Nokia’s vast production volume is an obvious strength. In fact, when Nokia streamlined in the 1990s, it already had the advantage of size. With several consecutive years of multibillion-euro profits despite a sagging economy and struggling telecommunications market (and rather flat sales at Nokia itself), the company has outshined its major competitors to become a model firm. Also, Nokia’s decision to focus on only one market after years of diversity was a courageous one, but it has led to its current position as one of the top global brands. The firm has likewise been characterised by many analysts to have an ability to adapt to changing market conditions in order to maximise profit. Listening to and identifying with consumers has allowed Nokia to construct a corporate culture that bears little resemblance to the Nokia of the past.
The firm’s weapon in this industry is their research and development department. The latter has gained increasing importance from company planners in its effort to stave off the competition. Nokia has been found to devote 10% of its revenue to research and development concentrated specifically on telecommunications mobility and Internet Protocol advancements (‘Nokia’s Success Story Pushing Wireless World’s Envelope’, 1999). This current research and development focus has allowed the company to maintain an appropriate balance between high-tech development and phones that are better-suited for first-time users in emerging markets. Further, part of the company’s innate strengths has also been attributed to its early adoption of the RossettaNet supply-chain management system, which is being adopted by many of the most important links in Nokia’s supply chain, which consists nearly of 2000 companies (Miller & Morey, 2004). Recognising that speed and scale matters in the telecommunications industry, RosettaNet implementation is just another example of how the insurgent Nokia stays ahead of the competition. Further, the company has strategies that generate sustained successes: rapid technology development, fuelled by innovative research and development, and keen market awareness, characterised by frequent product launches and updates. The ability to continuously renew and improve their product mix while effectively managing demand and supply is the key to maintaining Nokia’s leader status. Only by continuously using the insurgent strategies of global brand building, effective communications, supply-chain management, and control of the telecommunications dialogue through rapid product development is Nokia able to continue dominating the world market.#p#分页标题#e#
Weaknesses. Not all of their products are successful, which exposes a flaw in their research and development area. Take for example the N-gage series, which was widely considered as a flop. Also, they have shown slowness in adopting new paradigms of thinking. For instance, clamshell phones, which are favoured by many customers was taken for granted by Nokia until last year, when they finally launched its first model. They have also been shown to not have a strong market presence in China, as Motorola has taken over the said region. This is a very significant weakness on the part of Nokia, as China is has very fast-growing wireless market. A weakness in the mid-range portfolio is also notable. Analysts have accused the company of focusing too much on their high-end products. And in some countries, the value of their phones depreciates very quickly. This may be due to the reason that they have a lot of models to choose from ,and peoples’ attention are thus distracted very easily with new Nokia models that come out. Market analysts have also been shown to detect complacency and arrogance on the part of the company, and also of a failure to predict market trends and adapt to them accordingly. Furthermore, Nokia has been lagging in design innovation.
Opportunities. The basis for long-term competitiveness is the ability to develop continuously new generations of more advanced products. Therefore one of the company’s opportunities is to tap into more markets as a result of the innovations being introduced in the telecommunications industry. Also, the interaction with their suppliers allows for the pooling of resources and focus of efforts that make for major technological breakthroughs. No firm can hope to be among the world best in high-tech manufacturing as well as in public service provision. So the selection mechanism of the market tends to keep these two organisational fields wide apart. Yet, they need to co-operate intimately in order to develop the market. Localised capabilities enabling or even enhancing such co-operation will always make a difference when it comes to first-mover advantages. The company’s presence in the CDMA market, which they are just entering, as well as 3G and Edge markets, also present huge opportunities that Nokia could very well sustain. The opportunity to penetrate new growth markets where cell phone adoption still has room to go, including India and other countries is likewise a very attractive horizon. Leveraging Nokia’s infrastructure business to get first choice and stronger position against rivals is also an opportunity. They also have the opportunity to get ahead of Motorola in the China market, and this should be the case, since the said market is a potential sizeable source of income. The trend of changing new model of mobile phone every now and then within a short period of time is observed, thus frequent purchase from a single customer is likewise an opportunity for Nokia.
Threats. Competitors are major threats to the business. Ericsson, for instance, has been in this industry for more than a century. Nokia, in contrast, started out in other lines of business and entered telecommunications only during the last three decades. While Ericsson has gradually developed its core competencies and technologies over a very long time period, some of the major technological assets that underpin Nokia’s contemporary competitiveness have initially been developed by other firms, and subsequently been acquired by Nokia. The firm’s inability to keep up with innovations, or recognise its demand, creates a threat for them, a risk that they could be displaced by other industry leaders like Motorola, Sony Ericsson, Samsung and others. The legal and political environment in the countries where they operate in could potentially affect the business negatively. Their apparent complacence could be used by their competitors to their advantage, and take Nokia by surprise, with the latter realising too late that they are not the industry leader anymore. Customer discontent is also a very potent threat being faced by the company, connected to the hasty decrease in the separate product's life circle. The inevitability of using all the possible phone variants became one of the side effects of having wide product line, as Nokia products would show.#p#分页标题#e#
Chapter 5
Summary, Conclusion and Recommendation
5.1 Summary
At present, businesses are becoming more focused on being customer-oriented, because they are aware of the importance and advantages of having satisfied customers. Although, competition in the market environment is tough, companies are still able to compete well because of their effective marketing strategies. It has been said that such marketing activities has been founded by the entire organization’s desire to enhance the capabilities and potentials of their company to satisfy the needs of the customers.
According to Kotler (1994) the guiding principle now is customer value. Consumers rank products according to the value they generate. Marketers have to pay attention to the way consumers make decisions. Marketing is based on the process of exchange. Exchange involves two parties and the process is influenced by value, cost and satisfaction. 'Exchange is the defining concept underlying marketing.' For exchange to take place there have to be markets consisting of groups of people with specific needs for goods and services. Kotler provides meaning for marketing in terms of four basic concepts. However, the focus of this is about specific process to meet the needs of their customers.
Through this study, it can be perceived that gaining customer satisfaction is not an easy task. The marketing manager of Duty Free must be able to determine ways on how to satisfy their customers. Through this dissertation, it can be perceived that marketing strategies ensures quality
The underlying philosophical principle is that quality and its continuous improvement are important objectives. As high quality is achieved, improvement will be seen in other performance measures such as productivity. Emphasis is on improvement of processes and measurement of quality (Siegle, 1996). Quality is defined variously, such as impact of outputs, attitudes of consumers, and the skills of employees. Of course, without a strong leadership commitment it is difficult to implement the objectives of quality approach.
Accordingly, quality approach is a total philosophy of an effective marketing strategy. It has as its main objective the meeting of both internal and external customer's expectations through continuously improving all processes and products. It uses basic statistical tools to measure and refine work processes.
Customer loyalty is an important aspect of business because it is crucial to the establishment of a market based and improved competitiveness. Investing in customer loyalty offers a number of benefits including the maintenance of a customer base, enhancement of brand equity, cost savings in marketing activities, decreased price sensitivity, voluntary referral of customers to their social circle, improved products and services as well as better competencies, and value enhancement. Investing in customer loyalty also allows the business firm to gain an understanding of the processes and systems of the company on the part of customers and understanding of customer needs on the part of the consumer. When this happens, a relationship between the company and its customers emerges resulting to positive cognitive results on the part of the consumers resulting to customer loyalty. #p#分页标题#e#
Testing this theoretical relationship was made by looking at the case of NOKIA, experiencing changes in its market and competitive environment. The objective was to determine the relationship between organizational performance and customer loyalty by considering the relationship between the customer loyalty as the dependent variable and the eight measures of organizational performance as the independent variables. Two types of data was derived, secondary and primary data. Secondary data pertained to data found in books, journal studies, articles, papers and reports while primary data comes from the survey and interview with respondents who are customers of NOKIA. The investigative approach combines quantitative and qualitative data, with the quantitative data pertaining to measurable information especially from the survey while the qualitative data refers to the accounts or descriptions of the respondents regarding organizational performance and customer loyalty through the interview. The survey involved a structured questionnaire sent to the customers through main and the interview was made through phone. Three hundred customers were sent a questionnaire but only 180 returned the answered questionnaires. Fourteen respondents were selected from the respondents for the phone interview with these respondents representing the geographic and demographic market of the cable company,
Results showed that the organizational performance of NOKIA is high because of its ability to draw customers to become loyal clients but there remain areas for improvement. Organizational performance is determined by eight measures, which are equipment, reliability, competence, credibility, trustworthiness, customer care, courtesy and communication. All these measures positively and significantly influence customer loyalty as shown by majority of customers perceiving themselves as loyal customers. However, these measures have differing impact of customer loyalty with the first five measures influencing customers more strongly as compared to the last three measures. The first five measures then comprise the areas of organizational performance that effectively influence customer loyalty but could still be improved to ensure greater customer commitment to the company and its services. The other three measures of organizational performance constitute the areas requiring improvement especially since the issues and concerns mentioned by the respondents fell under these three measures especially poor relationship building and communications.
5.1 Conclusion
Today’s market is characterized by highly competitive organizations which are all vying for consumer’s loyalty. Firms are faced with the challenge to maintain their own competitive edge to be able to survive and be successful. Strategies are carefully planned and executed to gain the ultimate goal of all: company growth. In the traditional marketing strategies and theories, primary focus is accorded on finding ways to attract customers thereby increasing the market share of the business organization. Today, however, business firms have been exhausting means of maintaining and retaining customers for the overall growth of the business. According to Spreng, MacKenzie and Olshavsky (1996 July), customer satisfaction depends primarily on the expectations set by the customer in buying the product or service and if the purchased goods fall short in meeting such expectations, consequences will lead to customer dissatisfaction Marketing strategy plays a vital role in different organisations, including Duty free Shop. #p#分页标题#e#
The focus of this study is directed towards identifying if customer loyalty of Nokia products has a significant relation with the organizational performance. The objective is to understand the how customer loyalty affects organizational performance Data Collected from the respondents provided answers to the queries of the researcher. The primary source of information came from survey-questionnaire that was sent to the selected respondents of the study. These primary sources include the chosen customers 100 users of Nokia. The confidentiality of name of the customers were considered all throughout the research study, the respondent’s cooperation was fervently soughed after, and its descriptive and statistical analysis was undertaken by the researcher through the descriptive research method that uses observation and surveys and the correlation approach.
Results confirm the literature explaining the relationship between organisational performance and customer loyalty. The relationship exists because organizational performance links the improved efforts of the company in developing activities that support customer loyalty as the outcome. It can be said that customer loyalty also motivates the company to adopt customer-oriented operations allowing the company to learn more about the needs of the market as bases of improvements in existing services and the development of new services. As such, customer loyalty makes business firms more responsive to the changing market demand, allowing them to ensure customer satisfaction, retention and eventually customer loyalty.
Based on the survey and interview data from the customers of NOKIA, the product quality, and other image and features is crucial in increasing customer loyalty among NOKIA. Results showed that majority of the customers of NOKIA consider themselves as loyal to the company and its services but there are also sizable number of people that do not consider themselves as loyal to the company and its services. The research showed some respondents citing customer care and relationship building with customers as problematic. As such, even if many customers have a positive experience with the services of the company in terms of the different aspects, there are also customers that are not content with some aspects of the quality of the services of NOKIA. As such, discontent in some aspects of products quality could be the reason for some customers not considering themselves as loyal to the company. These are the areas requiring improvement in the services, service features, and service delivery in the company. Thus, NOKIA has been able to direct quality products to influence customer loyalty that explains its retention of a customer base in the long-term. However, there are areas for improvement requiring immediate attention. The research project has been able to derive secondary and primary data describing the relationship between organizational performance and customer loyalty, providing an explanation of the link between organizational performance and customer quality, and covering the extent of organizational performance and customer loyalty among the customers of NOKIA. The project also affirmed theoretical principles on the link between organizational performance customer loyalties, through empirical results from the case of NOKIA.#p#分页标题#e#
Recommendation
Having a loyal customers are essential elements for the success of all businesses. Through these, companies are able to gain competitive advantage. In this research paper, it becomes apparent that having loyal customers is among the key factors for businesses to succeed and meet the goal of having satisfied customers. From this discussion, several important points had been suggested. For instance, this research has implied the value of choosing the most applicable and effective marketing strategy which will enable them to meet and the needs of the customers. Sufficient time should be allotted by the company in order to develop effective marketing strategy plans. In addition, time is also necessary during the implementation process. Once the strategy has already been applied, time is also needed before the expected outcomes can be acquired. In relation to time requirements, it is also essential that the company applies a systematic approach in planning and implementing various business strategies so as to ensure that the organisational goals will be achieved. Through organized procedures, the company will be able to consider all possible options or risks involved in the selected strategy. In this way, problems or wastes are prevented.
Skills or expertise is also an important element in implementing business strategies, specifically leadership and communication skills. According to Thompson and Strickland (2003), strategies tend to evolve constantly. As businesses encounter different pressures and environmental factor over time, their respective managements must create strategies that are appropriate to their current situation. Some of the factors that encourage constant strategic changes include the identification of new business threats or opportunities, technological advancements, emergence of new purchasing trends and requirements, competitive conditions and initiatives to increase market share. Strategic reforms and business changes actually share a directly proportional relation; as changes and adaptations in business increases, the need for strategic reforms also increases. Business strategies must evolve in order to let companies overcome the challenges that they encounter.
The evolution of a strategy may actually be categorized into types based on its purpose for the business. In terms of speed for example, strategic change can take place gradually or rapidly depending on the needs of the company. Strategic reforms can also occur either reactively or proactively. Reactive strategic changes typically occur when new developments in the businesses’ environment arise. Proactive strategic changes on the other hand are done when the company was able to identify a new business opportunity or acquire new capabilities (Thompson & Strickland, 2003).
After citing all these other important needs, perhaps the most important learning from this research is that implementing business strategies, be its customer-oriented or not, is not a standard matter. Each business is operating in an environment that is different from others. This means, businesses are subjected to unique internal and external factors, which should be considered in strategy implementation. Hence, rather than follow the implementation practice of major and successful corporations, it is more recommendable to take an individualized or customized approach in implementing marketing strategies. In this way, greater control can be obtained. In marketing operations of Nokia, the marketing manager must have the ability to strategically decide the most essential external environment factors to be monitored in order to sustain customer satisfaction and loyalty.#p#分页标题#e#
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