Defensive Marketing Strategy by Customer Complaint Management: A Theoretical Analysis
Open Access
- 1 November 1987
- journal article
- research article
- Published by SAGE Publications in Journal of Marketing Research
- Vol. 24 (4), 337-346
- https://doi.org/10.1177/002224378702400401
Abstract
On the basis of Hirschman's exit-voice theory, an economic model of defensive marketing strategy is developed for complaint management. Though many firms strive to reduce the number of customer complaints about their products, this objective is found to be questionable. Instead, analysis suggests complaints from dissatisfied customers should be maximized subject to certain cost restrictions. The authors also show that defensive marketing (e.g., complaint management) can lower the total marketing expenditure by substantially reducing the cost of offensive marketing (e.g., advertising). The savings in offensive marketing are often high enough to offset the additional costs associated with compensating complaining customers, even if compensation exceeds the product's profit margin.Keywords
This publication has 12 references indexed in Scilit:
- Application of the “Defender” Consumer ModelMarketing Science, 1984
- The Vicious Circle of Consumer ComplaintsJournal of Marketing, 1984
- Defensive Marketing StrategiesMarketing Science, 1983
- Industrial Organization and Consumer Satisfaction/DissatisfactionJournal of Consumer Research, 1983
- Product Quality in Markets Where Consumers are Imperfectly InformedThe Quarterly Journal of Economics, 1979
- A Model of Advertising and Product QualityJournal of Political Economy, 1978
- Two Approaches to Contemporary Dispute Behavior and Consumer ProblemsLaw & Society Review, 1977
- Consumer Response to Unsatisfactory Purchases: A Survey of Perceiving Defects, Voicing Complaints, and Obtaining RedressLaw & Society Review, 1977
- Concerning the Logical Consistency of Multivariate Market Share ModelsJournal of Marketing Research, 1973
- Market Share and Rate of ReturnThe Review of Economics and Statistics, 1972