Preferred-customer model for industrial service markets: A taxonomy-based approach
(A2020-58613)

AUTHORS

Ming-Chih Tsai, Department of Marketing, National Chung Hsing University; Rico Merkert, The University of Sydney Business School; Shiau-Chi Lin, National Chung Hsing University ; Mei-Ting Tsai, Department of Business Administration, National Chung Hsing University

KEYWORDS

Preferred customer; Social exchange theory; Push–pull–mooring

ABSTRACT

Customer portfolio model assists companies in determining preferred customers but does not account for customer viewpoints and competitor effects, whereas relationship marketing only considers customer perspectives. In addressing the weakness, this study draws on social exchange theory and push–pull–mooring theory to develop a taxonomy-based preferred-customer model for suppliers in industrial service markets. For demonstration purposes, we study a mass B2B case involving air express services provided to manufacturer customers. Considering the features of mass services, we validate customer behavioral loyalty as a determinant of customer attractiveness and categorize customers into six groups, with three groups being prioritized as preferred customers. Results from analyzing 180 valid samples indicate models evaluating customer portfolios should not overlook the effect of competitors to identify the paradoxical behaviors of customers. Finally, sales volume that is practically used as a key indicator for classifying customers is found to be ineffective in differentiating preferred customers.