Balancing Market Share Growth and Customer Profitability: Budget Allocation for Customer Acquisition and Retention
Articles
Hsiu-Yuan Tsao
Tamkang University
Lucy M. Matthews
Kennesaw State University
Victoria L. Crittenden
Boston College
Published 2012-12-31
https://doi.org/10.15388/omee.2012.3.2.14267
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Keywords

customer equity
brand equity
theory of reasoned actions
retention spending

How to Cite

Tsao H.-Y., Matthews L. M. and Crittenden V. L. (2012) “Balancing Market Share Growth and Customer Profitability: Budget Allocation for Customer Acquisition and Retention”, Organizations and Markets in Emerging Economies, 3(2), pp. 45-55. doi: 10.15388/omee.2012.3.2.14267.

Abstract

This study adds to the knowledge of budget allocation for customer acquisition and retention spending in an inertia segment.  The results indicate that when retention spending surpassed the optimal budget allocation, increased spending did not grow the expected value of customer equity.  Since the inertia segment is comprised of loyal customers, an examination of brand equity and its role in customer loyalty and its influence on customer equity are discussed.
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