Dish Network Company Marketing Strategies - Case Study Example

The reasons why and how companies must change and adapt their marketing strategies to remain competitive Name Professor Institution Course Date The reasons why and how companies must change and adapt their marketing strategies to remain Executive Summary Loyalty marketing research has increased in the last decade due to increase in competition and globalization. This is because the competition has led to decrease in customer’s loyalty. Firms in most sectors are researching, assessing or adopting loyalty programs and strategies which are aimed at fostering great relationships with customers. However, technology advancement has presented tools and approaches for marketing executives to design new customer relation management tactics. Some of these tactics that many firms are now considering are quality customer services and customer loyalty programs. Companies that have failed to adopt these marketing strategies have registered poor performance or collapsed. These essay discuses the reasons why and how companies must change and adapt their marketing strategies to remain competitive. The essay will focus on Dish Network Company which has faced criticism and lawsuit due to poor marketing and customer service. Table of Contents The reasons why and how companies must change and adapt their marketing strategies to remain 2 Executive Summary 2 Table of Contents 3 1.0 Introduction 4 2.0 Company Background 5 3.0 Overview of customer loyalty 6 4.0 Key macro and environmental factors influenced customer loyalty 6 5.0 The major impacts this trend is having on international business, management and leadership 9 6.0 Problems of low customer loyalty 11 7.0 Analysis and summary on ‘where customer service and loyalty trend is going’ 13 8.0 Conclusion 15 9.0 References 16 1.0 Introduction In the current globalized markets, lowly and even highly satisfied clients often defect to the rival partly owing to a global decreasing customer loyalty trend (Fraering & Minor 2013, p.335). The occurrence of satisfied the though disloyal customers has encouraged marketing journals and literature to focus on the comparatively greater significance of customer loyalty in relation to satisfaction. Such reactions resonate with argument made by Oliver, Rust & Varki (1997, p.326) maintaining the customers which important are ones who are loyal. In the recent past, apart from technological influence, company management actions has left customers with no choice but to look for other market players who can offer more than just the need. In that way, exerts have express their concern with how the engagement and customer loyalty have decreased. Therefore, this essay will discuss some of the reasons why and how companies must change and adapt their marketing strategies to remain competitive. Under this topic, the essay will identify the key macro and environmental factors influencing this trend. It will also evaluate key impact this development has on international business, leadership and management. This essay will use Dish Network Company as an example in reference to marketing, customer service and customer loyalty. 2.0 Company Background Dish Network is an American corporation which offers satellite television, audio programming, interactive television and satellite internet to customers (Dish Network 2015). According Dish Network website in 2015, the company was established in 1980 and has its headquarters in Colorado; U.S. the company has grown and had 14 million customers who subscribe to its services, and with 34,000 employees. During its growth it has faced several criticisms from customer; a situation which had lowered its growth force to rebrand. Dominguez (2006) contends to its due to its employment of not qualified telemarketers, Dish Network independent dealers have always been charged and fined because they have illegal telemarketing tactics which violate, and do not have call lists hence end up making calls where a live marketer does not connect efficiently when the call answered. These kinds of actions have resulted to the company losing its customer to competitors because of dishonesty in business (Dominguez 2006). In the real sense dishonesty and lack of proper information to customers are some of the customers have ditched Dish Network for its rivals such as Comcast, Netflix, Directv and Sky PLC. Today, these companies have large customer which Dish Company may not surpass even in ten years (Channel 3000 2004). Even though is operating within a technology sector, it has not taken advantage of the platform create a clear communication channel, effective marketing platform and even effective loyalty program. 3.0 Overview of customer loyalty Nguyen & Thi Mai (2006, p.57) defines customer loyalty as the extent at which a customer displays repeat purchase actions towards the service and product, and also shows a positive attitudinal character towards the service provider. According to Ryu & Han (2010) loyalty works as a multi-dimensional framework which consists of positive and negative reaction and reviews. As stated earlier, a loyal client might not automatically be satisfied. Kursunluoglu (2014, p.531) maintained that even though defection is largely the inverse of loyalty, other factors can also cause defection such as location constraints, habit, money constraints and lack of differentiation and cost switching. This depicts that loyalty can also be influenced by other factors. Although in most cases customer loyalty are influenced by environmental forces such as economic, technological and social factors (Hirsh, Kang & Bodenhausen 2012, p.580). Today, numerous companies which have large customer bases have build customer loyalty programs which revolve around these factors and change will only make them to modify to satisfy the current customer demands. 4.0 Key macro and environmental factors influenced customer loyalty The implications of customer loyalty go far beyond customer retention (Kotler & Keller 2006). Increasing market share means persuading competitors’ customers with weak loyalty-based opinions and beliefs to defect, as well as enhancing the loyalty. Swati (2010) argues that in a broader perspective, loyalty in many positively performing companies has been mainly influenced by technological and social factors which includes attitude, psychological and emotional factor. It must be noted that these factors also forms the type of loyalty. Technology sets trends on what expect wants. Technology in the 21st century has been used to create customers loyalty by various companies. For instance most technological, airline and hospitality companies today built customer loyalty programs which are integrated with technology (La & Choi 2012, p.108). For example these companies provides free internet through Wi-Fi which has become of interest to modern clients. This is because majority of clients spend their time socializing and looking for products online. For airline and hotel companies, loyalty programs are electronically registering how many times the customer buy products and service with their companies. La & Choi (2012, p.112) assert that Customers who are more loyal and purchase service and products many times use their electronic cards to get discounts. Dish Network Companies has such programs but also does not lie about their products and services. In most circumstance, customers have been told about what the companies does not offer while also concealing the prices (Channel 3000 2004). Another relevant determinant of the customer’s psychology is the social environment and good conduct, when they offer good and efficient services for hedonic purposes and when clients spend quality time for a period of time in the atmospheric place (Ryu & Han 2010). For example, when clients are in a fashionable hotel, clients tend to spend their quality time, and may notice the physical environs knowingly and unknowingly before, during, and after the meal ass well as the food and services that are provided, good social set-ups which may include modern décor and interior design, lovely music, subdue lighting, ambient scent, brilliant color scheme, attractive table settings which determine satisfaction and loyalty (Jang & Namkung 2009, p.456). There is sufficient research which suggests that the social and disconfirmation are important indicators of customer satisfaction particularly in the hedonic consumption situation, previously it has been noted that there is the combinations of the effects of social environments and customer satisfaction. Jang & Namkung (2009, p.458) argue that because social environments plays a very important role towards the clients’ behaviors in hedonic services, hence it is important to know and to understand the importance of the clients’ satisfaction and the actions change depending upon their view of social environmental elements. In addition, it is important to be able to differentiate between regular clients and first-time clients in the hospitality and tourism industry as suggested by the researchers (AbuKhalifeh & Som 2012, p.138). However the research that was done on the differences between regular and first-time clients regarding the perceptions of social environments in the hotel industry is limited. Therefore the current research is meant to fill the research spaces by introducing proposals and testing integrative models which includes the relationship between the clients idea on social environments on their approval and devotion whereas differentiating between regular and first-time clients in the expensive hotels context. According to Ryu & Han (2010) social environment may have affecting responses such pleasure and arousal, however this can bring cognitive responses which may cause people to have different evaluation and judgments on the given place, goods and services that are offered. Jang & Namkung (2009, p) posited that in the previous research it was noticed that the atmospherics place a very important role in the evaluation of a customer’s services that is offered and as well as their responsible behaviors. For instance, if there is good music in the restaurant and the customer’s notices, these may influence positively the perceptions of the cognitive response. Hence, it is important to note that perceptions of the clients on the social environments might result to disconfirmation of overall dining experience (AbuKhalifeh & Som 2012, p.145). In order to know if the company offers good services to its customers, one will know by the frequently of the customers appearances. 5.0 The major impacts this trend is having on international business, management and leadership The decline of customer loyalty has made management re-evaluate their strategies to make their business remain relevant in the competitive and globalized business environment. As for Dish Network, it is improve customer service and loyalty of be pushed out of business by competitors. Dawson (n.d) holds that customer relationship management has become of the important issue in creating effective loyalty programs. Managers which have been let down by poor customer service have started hiring qualified and experienced service representatives to help redeem the image of the company. As part of continued learning, training in customer service has become part of most companies (Oliver, Rust & Varki 1997). The management now takes their customer representative through customer service training which enables them to have good employees with polite tone whenever they are handling customers on daily basis Reduction in engagement and customer loyalty particularly at Dish Network is an awake up to many companies. Today, leaders and managers have made communication part of their skills to improve customer satisfaction (Kotler & Keller 2006). In hospitality facilities like Four Seasons, communication skill has become on oft the effective tool for customer service representative with which they use to relate with customers. Accoding to Hirsh, Kang & Bodenhausen (2012, p.580) it assist maintain mutual understanding and relation between clients and management. Clear and soft speaking has enabled Hilton to attract new customers in their outlets across the globe. Customers who have experienced good customer service at the facility have recommended them for their friends (Kotler & Keller 2006). Reporting in businesses has been enhanced as management practice to inform the customer and public on the progress of the company. Because of decline in customer loyalty, disclosure of real prices and company profits is becoming a trend with companies who want to reduce doubts among doubts and number of questions asked by customers. Normally the managers are now asking themselves how well the clients know their product and service, and their prices (La & Choi 2012, p.117). Experts believe that with this knowledge, customer can decide to remain this company and make a repeat purchase in future. 6.0 Problems of low customer loyalty Many theories suggests that having qualified and purchasing experience plays a very important role in influencing the manner in which customers may repurchase the intended future (Fraering & Minor 2013, p.337). Service sector literatures which states that behavioral intention variable argues that the quality of services offered in order for the customer to be satisfied should be related to customers’ switching behaviors. Hee-Young Son (2014, p.254) believe that if the clients will not be satisfied with the companies’ services, this will as a result tarnish the image of the company and may result to instant decrease in their profits. Also if the company does not offer good services to its clients, they will migrate to other companies. It is therefore important especially for small businesses which depend on repeat business and positive word-of-mouth marketing on their success not to offer bad services to its clients (Hee-Young Son 2014, p.261). When there are no experienced customer care services this may cause the company to have no clients. This is because when new clients enter into the company and find that they are not given good reception, attention and have to wait for a long time before they are attended to, and also the employees of the company are not qualified they will end up not purchasing a thing. This what Dish Network has experienced in the recent. The company has been struggling to make profit without knowing their undoing. Avery (2011) claims that the recent external audit conducted in 2011 actually revealed to them customer service as their major weakness. The company started a make-over beginning with branding including changing logo and hiring qualified and experience customer service representatives. Dawson (n.d) maintains that clients who may encounter problems while in the company tend to inform their friends and relatives, because clients who may have bad experience tend to inform their friends and relatives so as to scarce them away. This as a result will influence the cost of your potential clients. It may also make individuals to have negative impressions about your company hence not coming to your company Appiah-Gyimah et al (2011, p.85). If the services that are offered in the company are not sufficient this will make other business partners not to be interested in working or to associate with you. Hee-Young Son (2014, p.256) contends that this will result in not having qualified job seekers since they will have the mentality that if the clients are treated unprofessionally definitely the staffs will be treated worse. Still staffs who do not perform well on their duties do not like to be treated badly by unpleasant clients, they may end up quitting their jobs hence cause increase in turn-over in the work force. It is very expensive to put advertisement for new staffs, also it is time consuming since the company has to interview them and to train them before they are assigned particular tasks in the company (Appiah-Gyimah et al 2011, p. 87). Regular clients may start questioning your integrity because of not having consistency with your staffs in the business. If there is poor customer care service the company will experience shortage of clients, and this will make the company to have low sales and also decrease in their profits for the business. Dawson (n.d) argues that this can cause regular cycle in that a company may experience some difficulties in trying to save money for their employees or training their employees on good customer care service, hence may end up having poor service. It is important for the company to up their game so that they may not end up having financial difficulties and end up losing their business. 7.0 Analysis and summary on ‘where customer service and loyalty trend is going’ A case of customer complains in Dish network must be a very serious concern for the management. It appears as a case of making profits versus customer satisfaction and loyalty. The truth is that once companies acquire large customer base and monopoly is created, they tend to in control and may not care much about customer service and satisfaction (Fraering & Minor 2013, p.339). However, as competition gets stiffer and service sector improves, a lot of changes are bound to happen in the 5 to 10 years. More customers whether more satisfied or not are likely to dissert one company for another. This depicts a strong message to companies which have dropped in terms of quality service delivery. Channel 3000 (2004) affirmed that Dish Network must be worried of this information edge where customers demands information on pricing, profits and corporate social responsibility. This is because the company has received numerous criticisms on transparency of its pricing and general customer service. In the next 5 to 10 years technology and globalization is likely to tremendously influence customer service and loyalty. Advancement in information technologies will probably improve management of customer relationship particularly at a personal level making that relationship much more effective than before (Dawson n.d). As the service industry continues to grow, the service providers are likely to not only different their product and services from rivals just by providing what the customer wants but also providing extra value what the customer demands. Power (2014) pined that the value-added products or service are likely to be intangible and greatly rely on buyer impressions, but also must be perceived by the marketer to have value additions and even beyond what the customer wants. The satisfaction such added value will also depend on how much the management of companies such as Dish Network goes the extra mile to offer customer value. The added value could be influenced by technological advances and globalization. Technological applications comprising of computer, Smartphone and internet technologies could determine customer loyalty programs (Power 2014). Such factors will also be used to design customer relationship management strategies. Before anything, marketers are likely to develop a marketing technological application which collects, data, analyze and present information of customer profile (Kursunluoglu 2014, p.531). The application might be sophisticated because customer have become complex and informed and can change loyalty any time. (Kursunluoglu (2014) contends that analytical customer management relationship application will have the platform of collecting, storage, mining, processing, deduce and the reporting of clients’ data capture and stored in technological warehouses. Hirsh, Kang & Bodenhausen (2012) asserted that this will help the modern companies to scrutinize consumer behavioral trends so as to design and create marketing and promotional approaches which best suit those trends. Management and technology experts project that the next key technological development within the loyalty programs would be incorporating of smart phones into the current schemes. At the moment, 60 percent of the population living in the US has acquired a Smartphone and use over two hours every day searching for various products over the internet (Dawson, R n.d). The program application will provide a connected link to an internet which could be activated by the locality and will connect effortlessly to other digital gadgets such as even when a customer is at home though smart TVs, Wi-Fi accessible devices or in-store incorporate with POS systems (Power 2014). The embracing of smart phones could be the most powerful marketing research and development of the decade that makes customers to have good relationships with their retailers. It is believed that mobile wallets are likely to substitute the resent card-based loyalty programs. 8.0 Conclusion The essay presents empirical facts on how what has influenced customer loyalty and how customer has decreased in the recent times. An analysis on Dish Network Company revealed how poor lack of proper communication, dishonesty and general poor customer service is a recipe for decrease in customer loyalty. This is serves as strong message to contemporary managers that with the competition facing every service sector, they must understand that customer service alone is not enough to judge customer, and extra added value like discounts free internet is likely to attract customer to remain loyal with their companies. As the loyalty decrease creative value addition on top of loyalty programs remains as the only hope to gain competitive advantage, therefore managers must be creative and innovative in creating value addition. 9.0 References AbuKhalifeh, A.N & Som, A.P 2012, Service Quality Management in Hotel Industry: A Conceptual Framework for Food and Beverage Departments, International Journal of Business and Management; Vol. 7, No. 14, 2012, pp.135-161 Appiah-Gyimah, R, Boohene, R.A, Agyapong, G.K & Boohene, K.A 2011, Customer Satisfaction in the Outdoor Advertising Industry: A Case of Alliance Media Ghana Limited, International Journal of Marketing Studies, Vol. 3, No. 2, pp.82-91 Avery, G 2011, New Dish Network CEO sees changed company soon, Business Journal Channel 3000, 2004, Have A Complaint About Dish Network? Consumer Protection Wants To Hear From Disgruntled Consumers, Channel 3000, Viewed on 28th January 2015 from http://web.archive.org/web/20040918051207/http://www.channel3000.com/news/2788823/detail.html Dawson, R n.d, Creating the Future of Customer Relationships, Viewed on 28th January 2015 from http://ahtgroup.com/publications/futurecr Dish Network 2015, Dish Network Company, Official Website, viewed on 28th January 2015 from http://about.dish.com/ Dominguez, C 2006, PUC issues warning to Dish Network over do-not-call violations, San Antonio Business Journal Fraering, M & Minor, M.S 2013, Beyond loyalty: customer satisfaction, loyalty, and fortitude, Journal of Services Marketing, Vol. 27, No.4 pp. 334-344 Hee-Young Son 2014, Investigating temporal effects of risk perceptions and satisfaction on customer loyalty, Managing Service Quality, Vol. 24, No. 3 pp. 252 - 273 Hirsh, J. B, Kang, S. K & Bodenhausen, G. 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