Marketing illustration Marketing theory

Why customers are important

Customers are the most important people for any organisation. They are the resource upon which the success of the business depends. When thinking about the importance of customers it is useful to remember the following points:

1. Repeat business is the backbone of selling. It helps to provide revenue and certainty for the business.

2. Organisations are dependent upon their customers. If they do not develop customer loyalty and satisfaction, they could lose their customers.

3. Without customers the organisation would not exist.

4. The purpose of the organisation is to fulfill the needs of the customers.

5. The customer makes it possible to achieve business aims.

Customer satisfaction

Customer satisfaction is at the heart of the selling process. One estimate is that it costs five times as much to attract new customers as it does to keep an existing one. The relationship between the customer and the organisation is, therefore, an important one.

Building customer relationships can be seen as moving up a ladder. At the top rung of the ladder are your loyal customers (advocates).

The ladder consists of four main rungs (with 4 being the highest):

  • 4 - Advocates
  • 3 - Regular customers
  • 2 - Occassional users
  • 1 - One-off purchasers

The extent to which customers move up the ladder depends on how well they are treated by the organisation. Well focused sales methods and attention to individual detail is likely to encourage customers to move up the ladder.

The Times 100 focuses on organisations which illustrate excellence in building relationships with customers over time such as Argos, which spends a lot of energy, and time on finding out what customers want. Other organisations like Nestle and Cadbury Schweppes place great store on building strong links with all their stakeholder groupings and with their customers through extensive market research.

Supporting Documents

These downloads will help to put marketing theory into context using real world examples from real businesses.

Re-focussing a company's culture and marketing mix
Argos logo

Discover how Argos employed marketing theory to succeed in the retail industry by downloading our premium case study.

Live, breathe and wear passion
Diesel logo

Find out how Diesel used marketing theory to succeed in the fashion industry by downloading our premium case study.

Protecting the marketing mix through intellectual property rights
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Find out how Intellectual Property Office used marketing theory to thrive in the public sector industry by downloading our premium case study.

Positioning the brand
Chap Stick logo

Learn how Chap Stick applied marketing theory to thrive in the healthcare industry by downloading our premium case study.

The use of social media in promotion
National Trust logo

Find out how National Trust used marketing theory to prosper in the non-profit industry by downloading our premium case study.

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