Rejuvenating importance‐performance analysis

Abstract

Purpose -Importance-performance analysis (IPA) is a simple marketing tool commonly used to identify the main strengths and weaknesses of a value proposition. The purpose of this paper is to propose a revision of traditional IPA prompted by intuitions arising from the three-factor theory of customer satisfaction. The ultimate goal is to propose a decision support method, which is as simple and intuitive as the original IPA, but more precise and reliable than the solutions proposed thus far. Design/methodology/approach -In order to estimate indirect measures of attribute importance, the study uses the coefficients of a multiple regression with overall satisfaction ratings as the dependent variable. Additional calculations are then introduced in order to manage non-linear effects. Findings -Using empirical data from a survey among 5,209 customers of a European bank, the authors show how the proposed method can be more accurate than other solutions, especially as disregarding non-linear effects can prompt sub-optimal marketing decisions. Research limitations/implications -While the procedure in this study is applicable to any service business, the paper does not claim external validity for the numerical results of the empirical application: the authors acknowledge that only one dataset has been used. The authors' goal is merely to demonstrate a revised approach to IPA. Originality/value -First, the authors assert the need for an explicit distinction between the use of IPA for customer acquisition vs customer retention purposes. These two cases refer to distinct moments in the customer relationship life cycle and thus require separate analyses. The authors then propose a specific method for customer retention IPA. On this basis, they generate two priority charts: one for the purpose of maximizing customer satisfaction and one for the purpose of minimizing customer dissatisfaction.

Collaborating with Local Communities to Identify Improvement Priorities for Historic Urban Landscape Based on Residents’ Satisfaction: An Application of Asymmetric Impact-Performance Analysis in Dandong, China

“…There are various attribute-level techniques to identify improvement priorities. Action grid analysis, which is well known as importance-performance analysis (IPA), is a simple and visual technique with considerable popularity [52][53][54]. In IPA, the attributes of the research subject are divided into four categories based on their performance and importance, which are derived from customer surveys [55].…”

Prioritizing destination attributes for optimal resource allocation: a study of Chinese tourists visiting Britain

“…There are several models depicting the hierarchical structure of satisfaction dimensions by classifying attributes into different categories, one of which is the Kano Model (Arbore & Busacca, 2011;Deng, 2007;Kano et al, 1984;Kuo et al, 2012). The Kano Model identifies the critical factors associated with performance that generate customer satisfaction (Chen, 2012).…”

“…Several modifications of IPA have been proposed in extant literature, such as IPA with Kano's Model or Three-Factor Theory (e.g. Arbore & Busacca, 2011;Kuo, Chen, & Deng, 2012), neural network-based IPA (Mikulić et al, 2012), and impact-range performance and asymmetry analysis (Back & Lee, 2015).…”

Applying the IPA–Kano model to examine environmental correlates of residential satisfaction: A case study of Xi'an

“…Importance-performance analysis (IPA) is a popular technique for service evaluation in the field of customer satisfaction because it yields insights into which service attributes should be prioritized (Arbore & Busacca, 2011). In particular, the attributes of a product or service can be divided into four groups based on their performance and importance to customers (Matzler, Sauerwein, & Heischmidt, 2003).…”

“…Residents as customers decide to which neighborhood to reside according to their residential preference and neighborhood performance, and local governments and developers enhance the quality of neighborhoods to keep/attract residents. Although the IPA and three-factor theory have become an effective marketing instrument in the fields of tourism (Albayrak & Caber, 2013;Deng, 2007), banking (Arbore & Busacca, 2011;Matzler et al, 2003), information service industry (Pezeshki et al, 2009;Skok, Kophamel, & Richardson, 2001), no studies have applied the approaches in the area of urban planning and residential satisfaction.…”