Customer Relationship with Supplier
For a positive growth of business all customers have to depend, directly or indirectly, on good and reliable suppliers. Apart from their expectations from the supplier the customers also need to be loyal to them so as to strengthen their relationship. Therefore customers should work on building a strong and long-lasting supplier relationship as they […]
Relationship Marketing – Leveraging on Supplier Relationships
Business today has become customer centric. Organizations are investing heavily into getting to know and building a relationship with the customer in order to retain the customer and extend the relationship. Use of technology and CRM tools, Organizations are able to customise communication to individual customers and target specific customer segments to focus upon. As […]
How to End the Culture of Business As Usual After Instances of Corporate Scandals
The Worrying Decline of Corporate Governance Standards Worldwide Of late, there has been a worrying decline in corporate governance standards leading to the exits of many high profile CEOs (Chief Executive Officers) as well as Directors of Boards from such firms, as well as a breakdown in the compact between the corporates and their stakeholders. […]
Need for Market Segmentation – Why Market Segmentation?
A set-up where two or more parties (also called buyers and sellers) are engaged in transaction of goods and services in exchange of money is called a market. At the market place the sellers sell their goods to the consumers (buyers) in exchange of money. Let us go through the following examples: Nokia offers wide […]
Introduction to Social Media Analytics
Social media strategy is key when it comes to reaching your audience and spreading the word about your business. But no strategy is complete without a clear plan for measuring the results. So, how do you understand the impact of your social media strategy? The answer is through social media analytics. What is Social Media […]
The world of business has altered a great deal in the last few decades or so, globalization and information technology has produced a young breed of well-informed customers. And so the marketing theory has also undergone changes. Service based industry is now at the forefront in the economic evolution.
Therefore, to sustain a loyal customer base relationship marketing along with other marketing mix forms base of the new marketing world.
Today’s companies want to use relationship marketing to improve customer loyalty, and generate profits.
Marketing is defined as an organization function which creates set of process through which company creates, communicates, manages and delivers value to customers. The portion of customer management forms the foundation of the relationship marketing. Relationship marketing looks to utilize tools of traditional marketing in creating long term value for customers. Relationship marketing theory proposes that as company delivers value to customer, strength of its relationship with the customer will improve and increasing the customer retention.
Scope of Relationship marketing is as follows:
From above it is clear that relationship marketing overlaps with other marketing strategies like service marketing, branding, channel marketing etc. However the differentiation comes in focus of other strategies for example service marketing focus is on intangible services, channel marketing looks at the interaction between channel partners. But relationship marketing looks at enhancing company performance by focusing on improving various relationships.
Relationship marketing’s focus is on improving relationships with supplier market, internal market, referral market, customer market and business market.
Internal markets: company’s culture, values and belief create the internal market. It includes people, process and groups.
Supplier Market: the various suppliers and vendor on which company is dependent to create its final product make up the supplier market.
Referral Market: Satisfied customer, professional advisors, etc. from the referral market. The satisfied customers are motivated bunch who through word of mouth promote the company.
Business Market: the external business environment forms business market for the company. They play a significant role in determining the success of the company.
Customer Market: this market consists of not only the end user, but also intermediaries who purchase products from the company.
The above mentioned markets form basis various relational exchanges around which relationship marketing is developed.
The existing and unresolved conflicts between the various markets and company play a pivotal role in determining long term success of the company. If any conflict remains unresolved it can lead to complete breakdown of commercial interactions between all market players. Therefore, it is necessary for the company to align its business process with relationship marketing strategy. The company has to create culture and formal systems where conflict customer issues are resolved.
A common understanding between all the players about their role and responsibility through relationship marketing helps in long term value for the customer.
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