Reversing the Logic: The Path to Profitability through Relationship Marketing

Many firms have experienced greater success through implementing relationship marketing strategies. This is achieved by gaining knowledge about their own customers through database marketing and about the general marketplace through marketing research. Over time, this has led firms to adopt a general framework which we call the conventional path to profitability. This conventional framework suggests that new product innovation leads to acquisition, acquisition combined with a rich experience leads to satisfaction, satisfaction leads to loyalty and customer retention, and loyalty/retention leads to profitability. However, we show that some of the links in the framework are weak based on both academic research and marketplace realities. Consequently, we reverse the logic of the conventional path to profitability. We introduce a new approach that starts the customer relationship management strategy with customer profitability and the notion that different customers should be rewarded and satisfied differently. In addition, we outline a strategy that relationship marketing firms can implement, leading to higher levels of customer profitability and offer directions for future research.     

A Comment on: Lower Bound Restrictions on Intensities in Data Envelopment Analysis by Bouhnik et al.

Journal of Productivity Analysis -     

Coordinating expectations through central bank projections

Experimental Economics - Central banks are increasingly communicating their economic outlook in an effort to manage the public and financial market participants’ expectations. We provide...     

Bridging skills demand and supply in South Africa: The role of public and private intermediaries

ABSTRACT

Demand-led skills development requires linkages and coordination between firms and education and training organisations, which are major challenges considering that each represents a ‘self-interested’ entity. The need for a ‘collaborative project’ involving government, firms, universities and colleges, and other bodies is thus increasingly recognised. However, the crucial role of intermediaries has been largely overlooked. The article addresses this gap by investigating the main roles of public and private intermediaries across three case studies: sugarcane growing and milling, automotive component manufacturing, and the Square Kilometre Array sectoral systems of innovation. The research highlights the need for a move towards systemic thinking, to bridge across public and private objectives. It shows that private intermediaries play a larger role than is recognised in policy; that public–private intermediaries play crucial roles in coordination; and the potential for public intermediaries to contribute more effectively to systemic functioning.     

Promoting alignment between innovation policy and inclusive development in South Africa

Innovation for inclusive development (IID) is widely promoted as a policy objective in the global South, but the challenge is that there is little design and implementation of context-appropriate instruments and incentives. One critical foundation is network alignment – that innovation policy should be aligned with the goals and strategies of government departments responsible for promoting inclusive development (Von Tunzelmann, N, 2007. Approaching network alignment. Draft Paper for the U-Know Consortium: Understanding the relationship between knowledge and competitiveness in the enlarging European Union). The paper contributes by using qualitative analysis software to analyse the nature of shared policy goals and instruments in South Africa, and assess how these can be aligned with each other and with the goals of IID. Three main spaces for policy intervention are identified, to promote IID in a way that goes beyond the aspirational and the rhetorical. Such analysis of formal policy does not take into account the political will, capabilities and resources for implementation, but it does provide a systematic evidence base to effect strategic change.     

Does Peacetime Military Service Affect Crime?

Draft lottery data combined with Danish longitudinal administrative records show that military service can reduce criminal activity for youth offenders. For this group, property crime is reduced, and our results indicate that the effect is unlikely to be the result of incapacitation only. We find no effect of military service on violent crime, on educational attainment, or on employment and earnings, either in the short run or in the long run. These results suggest that military service does not upgrade productive human capital directly, but rather affects criminal activity through other channels (e.g., by changing attitudes to criminal activity).