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• Relationship Marketing
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Relationship marketing
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'Relationship marketing' was first defined
as a form of marketing developed from
direct response marketing campaigns
which emphasizes customer retention and
satisfaction, rather than a dominant focus
on sales transactions.
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Relationship marketing
As a practice, relationship marketing
differs from other forms of marketing in
that it recognizes the long term value of
customer relationships and extends
communication beyond intrusive
advertising and sales promotional
messages.
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Relationship marketing
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Relationship marketing extends to include
inbound marketing efforts, (a combination
of search optimization and strategic
content), Public relations|PR, social media
and application development.
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Relationship marketing - Development
Relationship marketing refers to an
arrangement where both the buyer
and seller have an interest in
providing a more satisfying exchange.
This approach tries to
disambiguiously transcend the simple
post purchase-exchange process with
a customer to make more truthful and
richer contact by providing a more
holistic, personalised purchase, and
uses the experience to create stronger
ties.
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Relationship marketing - Development
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From a Social anthropology|social anthropological
perspective we can interpret relationship
marketing theories and practices as Gift
economy#Spheres of exchange and 'economic
systems'|commodity exchange that
instrumentalise features of Gift economy|gift
exchange.[http://dk.fdv.unilj.si/doktorska_dela/pdfs/dr_rus-andrej.PDF
Features of gift exchange in market economy] It
seems that marketers—consciously or intuitively—
are recognizing the power contained in Reciprocity
(cultural anthropology)|'pre-modern' forms of
exchange and have begun to use it
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Relationship marketing - Development
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According to Liam Alvey, relationship
marketing can be applied when there
are competitive product alternatives
for customers to choose from; and
when there is an ongoing and periodic
desire for the product or service.
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Relationship marketing - Development
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Modern consumer marketing originated in
the 1960s and 1970s as companies found
it more profitable to sell relatively lowvalue products to masses of customers.
Over the decades, attempts have been
made to broaden the scope of marketing,
relationship marketing being one of these
attempts. Arguably, customer value has
been greatly enriched by these
contributions.
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Relationship marketing - Development
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The practice of relationship marketing has
been facilitated by several generations of
customer relationship management
software that allow tracking and analyzing
of each customer's preferences, activities,
tastes, likes, dislikes, and complaints
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Relationship marketing - Development
Relationship marketing has also
migrated back into direct mail,
allowing marketers to take advantage
of the technological capabilities of
digital, toner-based printing presses
to produce unique, personalized
pieces for each recipient through a
technique called variable data
printing
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Relationship marketing - Scope
According to Gordon (1999), the
marketing mix approach is too limited
to provide a usable framework for
assessing and developing customer
relationships in many industries and
should be replaced by the relationship
marketing alternative model where
the focus is on customers,
relationships and interaction over
time, rather than markets and
products.
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Relationship marketing - Scope
In contrast, relationship marketing is
cross-functional marketing. It is organized
around processes that involve all aspects
of the organization. In fact, some
commentators prefer to call relationship
marketing relationship management in
recognition of the fact that it involves much
more than that which is normally included
in marketing.
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Relationship marketing - Scope
Martin Christopher, Adrian Payne, and
David Ballantyne at the Cranfield School
of Management claim that relationship
marketing has the potential to forge a new
synthesis between quality management,
customer service management, and
marketing.
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Relationship marketing - Satisfaction
Although groups targeted through
relationship marketing may be large,
accuracy of communication and overall
relevancy to the customer remains higher
than that of direct marketing, but has less
potential for generating new leads than
direct marketing and is limited to Viral
marketing for the acquisition of further
customers.
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Relationship marketing - Retention
A key principle of relationship marketing is the
retention of customers through varying means and
practices to ensure repeated trade from preexisting
customers by satisfying requirements above those of
competing companies through a mutually beneficial
relationship This technique is now used as a means of
counterbalancing new customers and opportunities
with current and existing customers as a means of
maximizing profit and counteracting the leaky bucket
theory of business in which new customers gained in
older direct marketing oriented businesses were at the
expense of or coincided with the loss of older
customers.Kotler, Philip, Armstrong, Gary, Saunders,
John and Wong, Veronica
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Relationship marketing - Retention
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However, it is suggested that because
of the extensive classic marketing
theories center on means of attracting
customers and creating transactions
rather than maintaining them, the
majority usage of direct marketing
used in the past is now gradually
being used more alongside
relationship marketing as its
importance becomes more
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Relationship marketing - Application
Relationship marketing and traditional (or
transactional) marketing are not mutually
exclusive and there is no need for a conflict
between them. A relationship oriented
marketer still has choices at the level of
practice, according to the situation variables.
Most firms blend the two approaches to
match their portfolio of products and services.
Virtually all products have a service
component to them and this service
component has been getting larger in recent
decades.
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Relationship marketing - Internal marketing
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It is claimed that many of the relationship
marketing attributes like collaboration,
loyalty and trust determine what internal
customers say and do
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Relationship marketing - The six markets model
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Christopher, Payne and Ballantyne (1991)
from Cranfield University goes further.
They identify six markets which they claim
are central to relationship marketing. They
are: internal markets, supplier markets,
recruitment markets, referral markets,
influence markets, and customer markets.
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E-crm - From relationship marketing to customer relationship marketing
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The concept of relationship marketing
was first founded by Leonard Berry in
1983. He considered it to consist of
attracting, maintaining and enhancing
customer relationships within
organizations.
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E-crm - From relationship marketing to customer relationship marketing
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The main difference between CRM and eCRM is that the first does not acknowledge
the use of technology, where the latter uses
Information technology|Information
Technology (IT) in implementing RM
strategies.L. Ryals and A. Payne, Customer
relationship management in financial
services: towards information-enabled
relationship marketing, Journal of Strategic
Marketing vol. 9 no. 1 (2001): 3-27.
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