Capital One's business model recognizes that each customer requires a different product and service benefits from a credit card provider, and acknowledges that if customers are offered what they want and need as opposed to what banks want to offer them, they will choose the provider that gives them choice and individuality. According to Egan (2001), a business model is a method of doing business and how it is sustained. In the case of Capital One, its business is sustained with the help of its information-based strategy (IBS). In other words, the business model of Capital One is fundamentally built on its IBS – a strategy that enhances Capital One's ability to better comprehend a customer's specific and unique credit risk and potential revenue profile (i.e. how to better manage its customer base), as well as enhancing its responsiveness in unraveling customer specific requirements (i.e. understanding what values customers seek from credit card providers), via the collection and analysis of customer data.
[...] & Gronroos, C. (1989), “Developing Customer-Conscious Employees at Every Level: Internal Marketing,” In C. Congram & M. Friedman Handbook of Services Marketing, New York. Heskett, J.L., Earl Sasser, W. Jr., and Schlesinger, L.A. (1997), The Service Profit Chain, The Free Press, New York. Morgan, R.M. and Hunt, S.D. (1994), Commitment-Trust Theory of Relationship Marketing,” Journal of Marketing, Vol July, pp. 20- 38. Mohr-Jackson, I. (1991), “Broadening the Market Orientation: An Added Focus on Internal Customers,” Human Resource Management, Vol No pp. 455-467. [...]
[...] Last, but not least, Capital One also supports the concept of a ‘flatter' organization and a ‘top-to-bottom' culture, as opposed to the conventional ‘bottom-to-top' philosophy. This business philosophy (i.e. ‘top-to-bottom' culture) encourages employees to engage in open communication, and to freely contribute their ideas or present feedback to top management, which in turn translate into employee satisfaction as employees feel that their opinions are being valued by the organization (Stone, 1998). Drawing on Figure management behavior has a significant influence on employee attitudes and satisfaction, which in turn generates higher level of customer satisfaction, thereby enhancing financial performance. [...]
[...] platform for true ‘one-to-one' marketing with its customers the data collated (which is then analyzed) allows Capital One to comprehend customers in terms of their economic importance (i.e. estimating a customer's lifetime spending potential), and then revising the marketing approach (i.e. adjusting its products to ensure that the needs of both Capital One and its customers are met), to reflect the existing and potential profitability of different customer groups (Christopher, Payne and Ballantyne, 2002). Otherwise stated, Capital One's IBS uses captured information to identify customers and prospects, which in turn allows them to establish a learning relationship with each customer or customer group, starting with the most profitable one. [...]
[...] Nemati, H. R. and Barko, C. D. (2003), Factors for Achieving Organizational Data-Mining Success,” Industrial Management & Data Systems, Vol Issue pp. 282-292. O'Malley, L. and Tynan, C. (2000), “Relationship Marketing in Consumer Markets: Rhetoric or Reality?” European Journal of Marketing, Vol No pp. 797-815. Peppers, D. and Rogers, M. (1993), The One-to-One Future: Building Business Relationships One Customer at a Time, Piatkas Publishers Ltd, London. Piercy, N. F. (1995), “Customer Satisfaction and the Internal Market: Marketing Our Customers to Our Employees,” Journal of Marketing Practice, Vol No pp. [...]
[...] With regard to Capital One's approach to internal marketing, the organization aims to develop awareness among employees of both internal and external customers, and to remove functional barriers to organizational effectiveness. Likewise, Capital One acknowledges the key role employees play in delivering customer value and considers its employee-recruitment process crucial in attracting and selecting the ‘right' people to deliver its customer service proposition. According to Stone (1998), selecting the ‘right' person for the task can contribute significantly to the organization's success, due to their ability to manage customer relationships better, thereby effectively delivering the customer service proposition. [...]
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