Linking Marketing and Operations Academic Article uri icon

abstract

  • In theory, it is a simple proposition: Make customers wait longer, and fewer of them will come back. But actual practice is complicated. Marketing develops a new product, service, affinity plan, and so on. This new marketing initiative causes changes in operational processes that increase customer service times. When waiting lines form, a small increase in service times for each customer magnifies into a significant increase in waiting time for the customer at the end of the line. The increase in waiting times causes a reduction in customer loyalty, which leads to lower customer retention, and hence, repurchases. Consequently, the marketing initiative has costs as well as benefits. Blockbuster, Inc. has developed a model that combines operational process analysis, waiting line simulation, real versus perceived waiting times, a customer loyalty model, and a financial model to find the bottom-line impact from operational changes of new marketing programs. © 2002, Sage Publications. All rights reserved.

author list (cited authors)

  • Evangelist, S., Godwin, B., Johnson, J., Conzola, V., Kizer, R., Young-Helou, S., & Metters, R.

citation count

  • 15

publication date

  • November 2002