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Literature & Language
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Credit customer relationship management (CRM)

Essay Instructions:
After reading the information in the Background please read and think about the CASE questions: Case Background: Please read the following article: Ferguson, Rick (2006) Using private label credit cards as a loyalty tool. The Journal of Consumer Marketing. Santa Barbara. 23(7). p. 374. Available in Ebrary on August 10, 2007. Click on <Using Private Label Credit Cards and Loyalty Tools> to access the article. Case for you to write up: Pathmark Sidestepping Interchange Fees With Loyalty/Payment Combo Card Written by Evan Schuman October 17, 2007 http://storefrontbacktalk(dot)com/story/101707pathmark Directions: (1) Read this case. (2) Review the above article and at least 1 more article from the background section or quality source on the Internet (not wikipedia). Hint: Do an Internet search on "credit and customer loyalty" and/or "credit and CRM." (3) Choose a retail chain where you have shopped and/or worked. Imagine that you are a VP of Customer Engagement for that store. (4) The CEO has asked you to prepare a memo for the Board of Directors. You are asked to comment on whether the Pathmark strategy ? debit/loyalty cards ? would be appropriate for your store. Your discussion (750-1000 words, excluding title page) should cover these topics. You are encouraged to use sub-headings related to each question. (a) Would this type of card be appropriate for your target market? Why or why not? (b) How can the program be modified to fit your particular retail chain and its target market? Why would your target market be especially responsive? For example, Victoria?s Secret offers its credit card holders a free gift every month with an extra on their birthdays. Their target market is women with discretionary income and a sense of fun, so gifts are appealing to them. Macy's has sales with an extra 10% off to credit card holders. They have a much broader market than Victoria?s Secret. (Do not use these examples in your own report. Create your own example.) (c) What kind of backlash can you anticipate from this program? What concerns customers (e.g., privacy loss)? Why? Prepare the memo as directed by the end of the module. Checklist for Grading ==> Demonstrate understanding of CRM ==> Directions followed for the assignment (absolutely critical!) ==>Take a strong position (not "we could have some of each") ==>Logical support for all our points ==>Evidence of use of required references and background materials (necessary for a grade of "B" or higher) ==>Use of APA formatting Guidelines here. ==>Length of 600-800 words (pages not as important as words) ==>Few quotes and absolutely no copying or close paraphrasing from any source without appropriate citation ==>No definitions and no summaries from the text ==>No general statements with "all," "none," "must," "should," "mandatory," and similar terms here is the back ground materiel : Module Two Anonymous. 2008. Rewards Programs Pay for Customer Loyalty, But Fail to Engage, According to Allegiance, Inc. Business Wire. New York: Feb 28. http://www(dot)reuters(dot)com/article/pressRelease/idUS151215+28- Feb-2008+BW20080228
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MGT515 MODULE 2 – CASE
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(13 November 2010)
MGT515 Module 2 – Case
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Credit customer relationship management (CRM) gives a chance for businesses to establish steady revenue through creating a portion of loyal customers. Research has indicated that most American doing shopping are engaging themselves in reward programs so as to earn points, get discounts and/or prices while they are shopping (Anonymous, 2008). Question arises whether these reward schemes help to attract and retain customers. They have also been used by many businesses but they remain weak in maintaining the emotional connection to ensure a long term relation of the business and the customer. Factors such as cost, data, and program evolution have been identified to affect the effectiveness of the reward programs (Anonymous, 2008).
The credit card has been linked to many loyalty programs and as Ferguson, 2006 in his article “Using private label credit cards as a loyalty tool” states there is increased use of credit cards in the crowded market to attract and retain customers. Successful companies such as Gap Inc.'s, Banana Republic and Old Navy stores where customers earn rewards for shopping have been used as examples to identify the successful ways of applying credit cards in loyalty programs (Ferguson, 2006). The loyal programs are most effective in maintaining competitive advantage especially in competitive markets where businesses needs to control a larger market share (Parahoo, 2010).
Schuman, 2007 in his article “Pathmark Sidestepping Interchange Fees with Loyalty/Payment Combo Card” describes the plans Pathmark is rolling out for achieving customer loyalty. The program aims at achieving loyalty through issuing discounts as well as convenience in the modes of payments for the customers. The Pathmark Advantage Payment Card launches in 10 stores to be on trial for six months.
Combining objectives can also help achieve the benefits of credit cards such ways as those of Pathmark where it is used as a loyalty program and also a means to reduce credit card transaction charges would ensure efficiency that would attract more customers to their fold and most importantly retain them in the long term (Schuman, 2007).
Establishing Loyalty
However competitiveness in the global markets is majorly based on high value relationships between the customers any means that can be used to enhance this relation ship must be utilized effectively (Jarratt, 2004). Of the methods that can be utilized include customer involvement, product quality, value, customer commitment and behavior which can help the business remains competitive (Cronin, et al., 2000). The company must ensure that they listen to the customers’ demand to prevent events where the credit cards are disposed off and the customers’ runs to other loyalty programs (Oliver, 1999).
A loyal customer then is one who spends more annually, have hi...
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