The Incidence and Perceived Managerial Merit of Customer Accounting in New Zealand

Abstract

Purpose – Two prior survey papers on the use and perceived merit of customer accounting practices, one in Australia and one in New Zealand, disclosed contrasting results with confusing elements. This survey replicates and extends the previous research to update and clarify our understanding of the use and perceived merit of Customer Accounting (CA) practices in New Zealand.

Design/methodology/approach – A mail questionnaire survey was sent to 136 companies quoted on the New Zealand Stock Exchange, resulting in 44 useable responses (32.4%).

Findings – This survey finds that mean scores for the usage and perceived merit of CA practices in New Zealand in 2009 are similar to those found in Australia in 2002, and much higher than those found in New Zealand in 2007. Also, a relationship between the use of activity-based costing (ABC) and the perceived merit of CA practices was found, but no relationship with actual CA usage. The research also found a strong positive relationship between the adoption of the customer concept of marketing management and the usage of customer profitability analysis at an individual customer level.

Research limitations/implications – The survey method prevents follow-up questions and clarification of ambiguities, but the survey results point to several areas warranting further research.

Originality/value – This survey provides academic researchers, teachers, and firms using, or considering the use of CA practices, improved understanding of the extent of current usage and perceived managerial merit of CA practices in New Zealand companies.

Keywords: Customer Accounting, CA, Customer Profitability Analysis, CPA, Customer Lifetime Value, CLV, Customer Equity, CE, Customer concept, Marketing concept, New Zealand