Case study:

Deakin University Burwood Childcare Centre (DUBCC) is planning to open its first childcare centre at Deakin University Burwood Campus. DUBCC aims to position itself as a supportive and enriching environment for children, providing them not only a safe and fun environment but one that is educational and promotes a sense of the Deakin University community. DUBCC intends to offer a blend of childcare and early education. They target the University academics, professional and general staff, as well as Deakin University students and residents. However, the four characteristics of services (Intangibility, Heterogeneity, Inseparability, Perishability) have significant implications for DUBCCs 7Ps (Product, Price, Place, Promotion, People, Process, and Physical Evidence) decisions. In your role as the marketing consultant for DUBCC, you are tasked to help the centre make the most appropriate and effective decisions about its 7Ps considering DUBCCs target customers and positioning.

Question 5. Describe how DUBCC could build customer loyalty by applying the theory of The Wheel of Loyalty as shown here.

3. Reduce Churn Drivers - Conduct churn diagnostic and monitor declining/churning customers - Address key churn drivers: - Proactive retention measures - Reactive retention measures (e.g., save teams) - Frontline staff - Account managers - Membership/ loyalty programs - CRM systems 1. Build a Foundation for Loyalty - Segment the market to match customer needs and firm capabilities - Be selective: acquire customers who fit the core value proposition - Manage the customer base Customer via effective tiering of service Loyalty - Deliver quality service - Increase switching costs - Build higher-level bonds: - Social - Customization - Structural 2. Create Loyalty Bonds - Deepen the relationship via: - Give loyalty rewards: - Financial - Cross-selling - Bundling - Nonfinancial - Higher-tier service levels - Recognition and appreciation