Drivers of Customer Equity
Date
2011-06-22
Authors
Simon, Sumoj
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Abstract
This research report aims to define the drivers of Customer Equity in the South
African Consulting industry. The Driver Model of Customer Equity was used to
formulate this research.
This report uses a supply-side qualitative survey, and a demand-side
quantitative survey to test if the propositions put forward from the literature
review and the qualitative survey held true. The identification of the drivers was
done through the literature review, and the qualitative survey that was
conducted among the suppliers of management consulting services. Five
supply-side managers and senior practitioners within consulting firms were used
in the qualitative round; the research instrument was a semi-structured
interview. The quantitative survey was designed to elicit demand-side
responses about what customers considered as important in choosing a
consulting firm. The quantitative survey had 36 respondents. The responses to
the quantitative questionnaire were tested using a distribution fitting approach
and exploratory factor analysis.
The distribution fitting approach found the following attributes within the drivers
of customer equity to be significantly important: Value Equity - the quality of
services rendered; Brand Equity – the customer’s perception of brand ethics,
based on the sub-drivers of ethical behaviour and the high regard received from
the community/ society; Industry Specific Drivers – the ability to deliver based
on a proven track record of successful delivery, as well as the knowledge and
intellectual capability of the firm, based on the drivers of intellectual ability and
having the right calibre of people to get the job done.
The exploratory factor analysis helped to show the interdependent relationships
among the variables in the quantitative questionnaire and the underlying
constructs that existed in the responses. The factor analysis resulted in a 5-
factor solution. The factors obtained were described as: Familiarity, Value,
Low-risk, Brand and Retention or Prior experience based purchase decisions
Description
MBA - WBS
Keywords
Customer equity, Consultants