Relationship Marketing

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Relationship marketing involves creating, maintaining and enhancing strong relationships with customers and other stakeholders. Increasingly, marketing is moving away from a focus on individual transactions and towards a focus on building value-laden relationships and marketing networks. Relationship relations hip marketing The process ofcreafing, maintaining and enhancing strong, vatue-laden relationships -with customers and other stakeholders.

Airbus Industrie's programme shows relationships irt many directions: with customers, •with suppliers, across airframe makers in foreign countries and with governments.

marketing is oriented more towards the long term. The goal is to deliver long-term value to customers and the measure of success is long-term customer satisfaction. Relationship marketing requires that all of the company's departments work together with marketing as a team to serve the customer. It involves building relationships at many levels - economic, social, technical and legal - resulting in high customer loyalty.

We can distinguish five different levels or relationships that can be formed with customers who have purchased a company's product, such as a car or a piece of equipment:

• Basic. The company salesperson sells the product, hut does not follow up in any way.

• Reactive. The salesperson sells the product and encourages the customer to call whenever he or she has any questions or prohlems.

• Accountable. The salesperson phones the customer a short time after the sale to check whether the product is meeting the customers expectations. The salesperson also solicits from the customer any product improvement .suggestions and any specific disappointments. This information helps the company continuously to improve its offering.

• Proactive. The salesperson or others in the company phone the customer from time to time with suggestions about improved product use or helpful new products.

• Partnership. The company works continuously with the customer and with other customers to discover ways to deliver better value.

Figure 11.3 shows that a company's relationship marketing strategy will depend on how many customers it has and their profitability. For example.

Profit margins









Accoun cable

Reactive 11

Basic \






Accountable H

Basic t 1






Accountable I


Relationship levels as a function of profit margin and number of customers companies with many low-margin customers will practise basic marketing. Thus Hem eke n will not phone all of its drinkers to express its appreciation for their business. At best, Heinelien will be reactive by setting up a customer information service. At the other extreme, in markets with few customers and high margins, most sellers will move towards partnership marketing. In exploring the Airbus A340-500 and A340-600, a very large commercial transport, Airbus Industries will work closely with the aero-engine manufacturers as well as with Lufthansa, Virgin Atlantic, Air Canada and Taiwan's Era Air, who have shown interest in buying the aircraft. For these businesses, the emphasis has to be on network marketing, where the interdependence of firms means they are part of an interdependent network. Marketing Highlight 11,3 explores this approach.

What specific marketing tools can a company use to develop stronger customer bonding and satisfaction? It can adopt any of three customer value-building approaches.'4 The first relies primarily on uddmg financial benefits to the customer relationship. For example, airlines offer frequent-flyer programmes, hotels give room upgrades to their frequent guests, and supermarkets give patronage refunds.

P & G advertise a toll-free number customers can call to join a money-back guarantee programme for Crest toothpaste. P & G supply dental patients with evaluation forms that they take to their local dentists. Dentists check for cavities and tartar build-up. After six months of Crest use and a return trip to the dentist, patients who haven't improved are refunded the money they spent on Crest.13

Beyond assuring customers that Crest delivers value, this promotion helps P & G build a customer database containing the dental histories of families that sign up. Using this database, P & G can expand its relationships with customers by offering additional related products and services to them.

Although these reward programmes and other financial incentives build customer preference, they can be easily imitated by competitors and thus may tail to differentiate the company's offer permanently. The second approach is to add social benefits as well as financial benefits. Here company personnel work to increase their social bonds with customers by learning individual customers' needs and wants, and then individualizing and personalizing their products and services. Heinz Weightwatchers Clubs have done that very effectively for people who are worried about their weight. They turn their customers into clients;

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  • lucia
    What is relationship marketing tools in promoting of a company's sales?
    7 years ago
  • Hana
    What is the relationship marketing in promotional tools of a company product or sales?
    7 years ago

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