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45-416: Nextel Communications traces its roots to the 1987 foundation of FleetCall by Morgan O'Brien , Brian McAuley , Chris Rogers, and Peter Reinheimer. FleetCall changed its name to Nextel Communications, Inc. in 1993. Nextel provided digital, wireless communications services, originally focusing on the fleet and dispatch customers, but later marketed to all potential wireless customers. Nextel's network operated in

90-471: A time-division multiple access (TDMA) technology. Some of the special features the company utilized included its push-to-talk feature, which simulated the half-duplex operation of a two-way radio. Nextel was one of the few carriers to have adopted iDEN around the world, although the technology has gained traction through NII Holdings in Latin American countries. iDEN (Motorola) is also utilized in

135-491: A " virtuous circle ". Effort spent in selecting and training employees and creating a corporate culture in which they are empowered can lead to increased employee satisfaction and employee competence . This will likely result in superior service delivery and customer satisfaction . This in turn can create customer loyalty , improved sales levels, and higher profit margins . Some of these profits can be reinvested in employee development thereby initiating another iteration of

180-503: A feature on some of their phones, marketed as DirectTalk . The technology uses the 900 MHz ISM band and provides ten FHSS channels for an off-network push to talk communications between individual phones that are not necessarily in range of wireless towers. In 2003, prior to its merger with Sprint, Nextel had announced plans for its next generation 3G network. It was reportedly to use an extension to iDEN called WiDEN , developed by Motorola. Nextel upgraded their network to support

225-539: A given level of overall satisfaction, customer loyalty is disproportionately stronger when customers perceive that employees are also satisfied. The SPC model has become the basis of a large body of empirical research showing the strong impact of customer satisfaction on customer loyalty. Research has clearly shown that one of the best ways to increase customer loyalty—measured as repurchase intentions and/or repurchase behavior—is by increasing customer satisfaction (more satisfied customers are more loyal, in general). Though

270-572: A large customer base. Nextel was the first company to implement a nationwide push-to-talk system similar to a walkie-talkie, marketed as DirectConnect. Unlike other cellular networks, the Nextel network operated in the Specialized Mobile Radio band, and Nextel was one of the first providers in the United States to offer a national digital cellular coverage footprint. The company was the first in

315-500: A legal battle in June 2003 over Verizon's advertising for their push-to-talk feature. The companies reached a settlement in early 2004. Initial advertising for Verizon's service was heavy, but it became almost nonexistent fairly quickly, possibly due to poor reviews of the service. The push-to-talk feature, with which Nextel has gained popularity, was made interoperable with the QChat technology on

360-474: A methodology for managing customer loyalty and firm profitability, is also applicable in business-to-business markets, irrespective of whether the B2B firm sells goods and/or services. The satisfaction-profit-chain refers to a chain of effects whereby increased performance on key attributes leads to improvements in overall satisfaction, which in turn affects loyalty intentions and behaviors. The increased customer loyalty

405-526: A result of these efforts, and what was reported to be a strong focus on customer satisfaction across the organization, Nextel was known for industry-leading customer retention rates, average revenue per user , and customer lifetime value . Nextel had long worked closely with a single vendor, Motorola , on both equipment and standards. The close relationship had yielded the Integrated Digital Enhanced Network (iDEN) protocol, which uses

450-496: A significant investor in the company. Other early investors and employees include Mark Warner , now a United States Senator from Virginia, and Jack Markell , the former Governor of Delaware. The founders chose the name "FleetCall" because the company's network used the 800 MHz Specialized Mobile Radio frequencies designated by the Federal Communications Commission for use in fleet dispatch. The core of

495-538: A spectrum auction. On June 19, 2003, Nextel and NASCAR announced a sponsorship agreement to rename NASCAR's top racing series to the Nextel Cup Series beginning in 2004. Nextel replaced R.J. Reynolds Tobacco Company cigarette brand Winston after it spent 33 seasons being NASCAR's Cup Series title sponsor. In 2008, however, the series was renamed the Sprint Cup Series due to Sprint Nextel's plan to phase out

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540-449: A virtuous cycle. Fred Reichheld (1996) expanded the loyalty business model beyond customers and employees. He looked at the benefits of obtaining the loyalty of suppliers, employees, bankers, customers, distributors, shareholders, and the board of directors. Duff and Einig (2015) expanded the model to debt issuers and credit ratings agencies to investigate what role commitment plays in issuer-CRA relations. The satisfaction-profit chain

585-496: Is a business model used in strategic management in which a company's resources are employed so as to increase the loyalty of customers and other stakeholders in the expectation that corporate objectives will be met or surpassed. A typical example of this type of model is where quality of product or service leads to customer satisfaction , which leads to customer loyalty, which leads to profitability . A model by Kaj Storbacka, Tore Strandvik, and Christian Grönroos (1994),

630-520: Is a model that theoretically develops linkages and then enables researchers to test them statistically for a firm using customer data (both from surveys and other sources). The satisfaction-profit-chain was tested in the context of banking industry showing that product and services improvements indeed were associated with customer perceptions, which led to beneficial customer behaviors such as repurchase, and desirable financial outcomes such as increased sales and profitability The satisfaction-profit-chain, as

675-503: Is claimed by Reichheld and Sasser (1990) that a 5% improvement in customer retention can cause an increase in profitability between 25% and 85% (in terms of net present value ) depending upon the industry. However, Carrol and Reichheld (1992) dispute these calculations, claiming that they result from faulty cross-sectional analysis. According to Buchanan and Gilles (1990), the increased profitability associated with customer retention efforts occurs because: For this final link to hold,

720-415: Is likely to be high. Customer satisfaction can also be high even with mediocre performance quality if the customer's expectations are low, or if the performance provides value (that is, it is priced low to reflect the mediocre quality). Likewise, a customer can be dissatisfied with the service encounter and still perceive the overall quality to be good. This occurs when a quality service is priced very high and

765-474: Is shown to affect short- and long-term financial outcomes including sales, profitability, and stock price. More recently, some studies show that especially in the context of services such as retailing and financial services, employee satisfaction can play a critical role in enhancing customer loyalty. This happens because both customer satisfaction and employee satisfaction can mutually reinforce each other, and promote stronger customer loyalty. More specifically, for

810-480: Is the patronage concentration ratio . This calculation is hindered by the difficulty in allocating costs to individual relationships and the ambiguity regarding relationship cost drivers. Schlesinger and Heskett (1991) added employee loyalty to the basic customer loyalty model. They developed the concepts of "cycle of success" and "cycle of failure". In the cycle of success, an investment in your employees’ ability to provide superior service to customers can be seen as

855-475: The Boost Mobile brand. In late 2010, Sprint Nextel announced plans to decommission the Nextel iDEN network; on May 30, 2012, Sprint Nextel announced that it would shut down the Nextel network as early as June 2013. The Nextel network was officially shut down at 12:01am on June 30, 2013, and Sprint began the process of deploying LTE equipment on the 800 MHz spectrum formerly used by the iDEN network. Before

900-672: The WiDEN packet data protocol, increasing data speeds up to 90 kbit/s. The Motorola i850, i860 , i870 , and i880 were the only phones to support WiDEN without modification. In October 2005, in order to free up network capacity for cellular calls due to rebanding, Sprint removed the ability to connect to the WiDEN service from all Nextel towers. Following the completion of the Sprint-Nextel merger on August 12, 2005, future plans for Nextel included migrating customers to Sprint's CDMA network. After

945-403: The service quality model, is more detailed than the basic loyalty business model but arrives at the same conclusion. In it, customer satisfaction is first based on a recent experience of the product or service. This assessment depends on prior expectations of overall quality compared to the actual performance received. If the recent experience exceeds prior expectations, customer satisfaction

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990-423: The 800 MHz band. Nextel (Sprint) paid for much of the cost of this reconfiguration, but in compensation for lost 800 MHz spectrum, the company received spectrum in the 2 GHz band at 1910–1915/1990–1995 MHz. This spectrum was located near the existing Sprint PCS allocations and can be used to expand the number of channels available for that service, without needing to bid for additional capacity in

1035-412: The 800-MHz Specialized Mobile Radio band and used iDEN technology developed by Motorola. Nextel's iDEN network offered a then unique push-to-talk "walkie-talkie" feature in addition to direct-dialed voice calls. Nextel was one of the first providers in the United States to offer a national digital cellular coverage footprint. Prior to merging with Sprint Corporation in 2005, Nextel Communications, Inc.

1080-428: The 854-862 MHz spectrum. 860-861 MHz is designated as an "Expansion Band", and 861-862 MHz is designated as a "Guard Band". No licensees other than ESMR are required to relocate to channels above 860 MHz. The use of contiguous spectrum allows for simple filters to be installed to protect public safety radio systems from interference, which is currently impossible under the existing mixed allocations in

1125-456: The 861-866 MHz range, and public safety organizations had exclusive use of the 866-869 MHz range. During the rebanding process, the following occurred: After rebanding, public safety organizations and critical infrastructure institutions obtained the exclusive use of 851-854 MHz. ESMR systems (primarily Nextel) were given exclusive use of 862-869 MHz range, and public safety, business/industrial users, and low-power SMRs shared

1170-662: The Nextel brand name; the name lasted until the end of the 2016 season. Nextel was also a major sponsor of the now defunct ChampCar team PacWest Racing , which was owned by Craig McCaw 's brother Bruce. Morgan E. O%27Brien Too Many Requests If you report this error to the Wikimedia System Administrators, please include the details below. Request from 172.68.168.226 via cp1108 cp1108, Varnish XID 804571847 Upstream caches: cp1108 int Error: 429, Too Many Requests at Fri, 29 Nov 2024 08:43:32 GMT Loyalty business model The loyalty business model

1215-572: The Southeast of the United States by SouthernLINC Wireless and in Canada by Telus Mobility under the Mike Mobile brand. Nextel gained a significant marketing and technological advantage through its push-to-talk technology. In 2003, Verizon Wireless and Sprint PCS each launched push-to-talk features, with Cingular following in 2005. None have gained significant traction. Nextel and Verizon had entered

1260-500: The Sprint network in 2008. Sprint had originally launched its own push-to-talk service, known as ReadyLink , which is based on SIP . Due to the difference in technology, users of the ReadyLink service were never able to make or receive push-to-talk calls with users of the iDEN technology. By 2009, Sprint began phasing out QChat to again focus on marketing iDEN devices. Nextel also offers

1305-513: The United States to integrate global positioning system features into their phones and to complete their 2G network upgrade. Nextel was also an industry leader in customer lifecycle management . They invested significantly in analytics capability, which allowed them to surpass their competitors in handling customer concerns effectively. The company also developed capabilities allowing it to assess and review customer relationship values objectively and to project and respond to customer loyalty . As

1350-534: The acquisition by T-Mobile US , Sprint Corporation continued to offer pre-paid services under the Boost Mobile brand and also offered push-to-talk services as Sprint Direct Connect using CDMA equipment. Telecommunication lawyers Morgan E. O'Brien and Chris Rogers and investment bankers Brian McAuley and Peter Reinheimer founded FleetCall in 1987. FleetCall changed its name to Nextel Communications in 1993. In 1995, wireless industry pioneer Craig McCaw became

1395-587: The brand . Earlier models of customer commitment conceptualized it as a unidimensional construct (e.g., Garbarino and Johnson 1999; Moorman et al. 1992). More recently, scholars have developed a five dimensional scale to measure customer commitment and relate it to customer loyalty. The five commitment dimensions include: Typically, loyalty data is being collected by multi-item measurement scales administered in questionnaires by software providers such as Confirmit , Medallia , and Satmetrix . However, other approaches sometimes seem more viable if managers want to know

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1440-496: The business model was to buy these fleet dispatch frequencies from existing operators at a substantial discount when compared to the cost for the equivalent bandwidth available via auction from the Federal Communications Commission. These "non-cellular" frequencies were made usable for a consumer and business wireless voice telephone service with the iDEN technology developed by Motorola , which some observers at

1485-453: The industry, the utilitarian or hedonic nature of products, and customers' switching costs can affect the nature (non-linearity) and strength of the link between customer satisfaction and customer loyalty. 3) The measurement of loyalty—especially for customers is multi-faceted. Customer loyalty includes a variety of outcomes—intentions and behaviors associated with repurchase including word-of-mouth, complaint behaviors, share-of-wallet or

1530-423: The level of customer loyalty was much higher among those customers who were themselves more satisfied, but also interacted with more satisfied employees. Highly satisfied customers who dealt with relatively less satisfied employees were relatively less loyal. The customer commitment approach to loyalty is based on the idea that customers with higher commitment toward the brand are also more likely to be loyal toward

1575-496: The level of satisfaction experienced by front-line employees is a critical component. The level of employee satisfaction influences customer satisfaction as shown in a large-scale study of managers, front-line employees, and customers of a DIY retailer in Europe: results showed that managers affected overall job-satisfaction of front-line employees, which in turn affected the satisfaction of customers they interacted with. Most surprisingly,

1620-429: The link between relationship strength and customer loyalty. Customer loyalty is determined by three factors: relationship strength, perceived alternatives and critical episodes. The relationship can terminate if: The final link in the model is the effect of customer loyalty on profitability. The fundamental assumption of all the loyalty models is that keeping existing customers is less expensive than acquiring new ones. It

1665-500: The merger, Sprint maintained the Nextel trademark as an unrelated group in Florida not affiliated with Sprint filed two trademarks and opened its businesses under the Nextel name. Sprint has sued the group that alleges trademark infringement. Due to many underlying maintenance and life cycle issues within the legacy public safety systems of the United States, co-channel interference was a common occurrence within 800 MHz band. To resolve

1710-499: The problems, Nextel and the Federal Communications Commission developed a plan, approved by the FCC in August 2004, to relocate Nextel systems elsewhere in the 800 MHz band in order to reduce the potential for interference. Before rebanding, public safety organizations, business and industry organizations, and SMRs/ESMRs both operated in the 851-861 MHz range. ESMRs had exclusive use of

1755-508: The relationship is positive, research shows there are many differences: 1) The effect of customer satisfaction on customer loyalty can vary based on customer demographics and segments, such that it is stronger for some demographic groups and segments than others. 2) The effect of customer satisfaction and customer loyalty, and subsequent financial outcomes for firms, can vary based on industry. Specifically, factors such as—goods versus services industry, degree of competition or concentration in

1800-436: The relationship must be profitable. Striving to maintain the loyalty of unprofitable customers is not a viable business model. That is why it is important for marketers to assess the profitability of each of its clients (or types of clients), and terminate those relationships that are not profitable. In order to do this, each customer's "relationship costs" are compared to their "relationship revenue". A useful calculation for this

1845-421: The relative proportion of purchasing from a single firm relative to customer's total purchasing, and likelihood to recommend. 4) Customer loyalty is influenced, not only by customer satisfaction but also employee satisfaction. Customer loyalty is a function of customer satisfaction. In many firms, especially service-oriented industries such as retailing, health-care, financial services, education, and hospitality

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1890-648: The strength of the business relationship if the customer's overall perception of quality remains high, if switching costs are high, if there are few satisfactory alternatives, if they are committed to the relationship, and if there are bonds keeping them in the relationship. The existence of these bonds acts as an exit barrier. There are several types of bonds, including: legal bonds (contracts), technological bonds (shared technology), economic bonds (dependence), knowledge bonds, social bonds, cultural or ethnic bonds, ideological bonds, psychological bonds, geographical bonds, time bonds, and planning bonds. This model then examines

1935-425: The time said would not be practical. Initially, FleetCall did not want to include the push to talk feature in their phones, but the FCC required it as the initial frequencies were licensed for dispatch use. Later, Nextel would use the push-to-talk feature as a key marketing advantage. Nextel affected the cellular phone market in several ways. It was the first company to successfully provide unlimited calling plans to

1980-528: The transaction provides little value. This loyalty business model then looks at the strength of the business relationship; it proposes that this strength is determined by the level of satisfaction with recent experience, overall perceptions of quality, customer commitment to the relationship, and bonds between the parties. Customers are said to have a "zone of tolerance" corresponding to a range of service quality between "barely adequate" and "exceptional". A single disappointing experience may not significantly reduce

2025-510: Was a publicly traded company. Shares traded on the NASDAQ under the ticker symbol NXTL . Nextel was headquartered in Reston, Virginia , United States. At the time of its 2005 merger with Sprint Corp., Nextel had over twenty million subscribers in the United States and served 198 of the top 200 markets. Nextel Communications, Inc. offered postpaid services under the Nextel brand and prepaid services under

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