Aspects Of Relationship Marketing Marketing Essay

Published Date: 23 Mar 2015

The objective of the research is to find critical differences between two aspects of relationship marketing namely-B2B and CRM. Any successful B2B strategy has to help the customer to be loyal and supportive to the firm and its products.  The  customer do  not  just get  a  need,  the  B2B marketer  have  to  help  the customer though getting him to feel a need and then buy the product and finally become loyal. The industries also need to take the marketing tool of customer relationship management seriously and provide proper focus to it. The CRM helps the organization to focus on the needs and the requirements of the customers. The CRM must ensure that the products and the services offered by the organization are proper response to the changes in the aggregate customer behavior pattern. (CRM News)The automobile industry also need to provide proper maintenance and after sales service to ensure good CRM. In today's competitive world it is imperative that the offers to the customer are according to the needs and the requirement of the customer. The organization may even have to customize the products according to the needs of the customer.  In order to provide better services which is a part of the promotional strategy companies are appointing customer relationship officer to make the customers aware about the new offers and also to solve all their problems in order to create a strong brand image in the minds of the consumers.

The aim in relationship marketing is to build and maintain relationships with all the organisation's publics. The list given is not comprehensive, and some publics will obviously have more influence over a particular firm's activities than others. The task is to identify those groups which are the main influencers and to design marketing programmes and strategies which take the influencers into account. Research is important to establish why customers defect, as studies have shown that a large proportion of dissatisfied customers never complain - they simply stop using the service. By the same token, customer complaints handling procedures should be properly carried out to ensure that the complaint is rectified and the customer is satisfied the necessary action is taken to prevent that (CRM News).problem occurring again but the starting point is usually to examine the external environment and the changes taking place within it. The audit then gradually narrows its focus from the general aspects of the organization's marketing activity to the more specific, until, finally, specific problem areas or difficulties can be probed more closely if required. It is useful to understand the components identified above, and the main questions which should be addressed in the audit.

A number of tools can assist in the process. An example of this is database marketing where customer-buying histories and other information can be listed on a database, and then referenced and cross-referenced in the future to target new products or promotions accurately. (China B2B Market)Another important aspect of the task of analyzing how to retain customers is to carry out market research amongst customers who have defected. Why did they go to a competitor? Why have they stopped using your service? The answers to these questions can hold vital information for services marketing managers.

This analysis suggests that both are just two different verticals of establishing relations. They mainly differ in the approach; the idea behind both is the same.

Introduction

Any successful B2B strategy has to help the customer to be loyal and supportive to the firm and its products.  The  customer do  not  just get  a  need,  the  B2B marketer  have  to  help  the customer though getting him to feel a need and then buy the product and finally become loyal. When  a  B2B  marketer  wants  to  develop  strategy  driven  promotions  that  motivate  B2B customers, they have to find a solution to the problems with purchase barriers. First some key questions have to be answered; who is the true decision-maker at the targeted company; what excites the decision-maker; what is holding the buyer back. When these questions have been answered  then  the  type  of  promotional  strategy  can  be  chosen  and  the  sales  promotional technique derived will be depending on the company's objectives.

In order to develop a successful sales promotion strategy a clear definition of the targeted market must be included.  It is  important to  understand  why the  potential customers are not buying  the  products  and  develop  a  specific  program  to  overcome  these  barriers.  To understand the customer's mental process the Customer learning curve can be of importance. There  are  different  types of  sales  promotional  tools  and  they affect  sales,  profitability  and value added to the brand in different ways. Therefore,  it  is  appropriate  to  study  sales  promotion  from  a  B2B  perspective  and  further investigate the impact that different sales promotional tools have in an Automotive industry.

Customer relationship management: (The B2B battle:CRM Vs B2B) The industries also need to take the marketing tool of customer relationship management seriously and provide proper focus to it. The CRM helps the organization to focus on the needs and the requirements of the customers. The CRM must ensure that the products and the services offered by the organization are proper response to the changes in the aggregate customer behavior pattern. The automobile industry also need to provide proper maintenance and after sales service to ensure good CRM. The study will help us ascertain the various marketing strategies that should be employed by the auto mobile sector players to develop new market segments and to attract more number of the potential customers. Sales promotion is a marketing tool which is used by the organization to ensure that the sales of the organization are promoted. The promotion of the products and the services are surely bound to increase the sales and hence the profits for the automobile organization. Sales promotion schemes can also be used by automotive industry to promote the launch of the new vehicles and the automobiles by the organization. The email address of the employees of the organization is used to make the B2B communication. Hence it is very important that the email address of the employees is professional and carry the reference of the organization. These simple and small things can make big change in the long run and hence should not be neglected by the organization.

Relationship Marketing

In today's competitive world it is imperative that the offers to the customer are according to the needs and the requirement of the customer. The organization may even have to customize the products according to the needs of the customer.  In order to provide better services which is a part of the promotional strategy companies are appointing customer relationship officer to make the customers aware about the new offers and also to solve all their problems in order to create a strong brand image in the minds of the consumers.

Green marketing, following the trend towards environmentalism which is growing through concern for the world's resources, suggests that no marketing decision should be undertaken without regard to the possible long-term effects. Product design, packaging, manufacturing process and distribution decisions are examples of the issues influenced by 'green' thinking. They are prepared to seek out products which are more environmentally friendly, for example, and will think twice before investing money in a bank which invests in countries or industries which are politically and environmentally unsound, in societal terms. (What B2B Markets do?)

Internal marketing calls upon the organisation to have equal regard for its internal customers - the employees - as for its external markets. Internal marketing programmes can enhance employee and customer satisfaction through increased involvement between all members of the organisation in its marketing efforts. Relationship marketing goes a step further. Quality service is the key to customer retention through customer satisfaction. Customers who keep coming back for more is the goal; zero defections rather than zero defects.

Key Focus

The key focus of marketing has always been the market - customer needs and wants. However, there are many other influences on an organisation's marketing activity. In conducting a SWOT (strengths, weaknesses, opportunities and threats) analysis, an organisation must consider these micro-environmental factors. As well as the organisation itself, and its internal and external markets, its publics must be considered. An organisation's publics include:

Suppliers

Intermediaries and other channel members

The government and its agencies

Shareholders

Community groups

Affiliated trade and professional associations

Trade unions

Banks and finance houses

Consumer groups

The aim in relationship marketing is to build and maintain relationships with all the organisation's publics. The list given is not comprehensive, and some publics will obviously have more influence over a particular firm's activities than others. The task is to identify those groups which are the main influencers and to design marketing programmes and strategies which take the influencers into account.

Relationships with channel members - B2B

Out of all the influencers discussed above, a particular group merits special attention when it comes to building relationships. This set of publics interacts directly with the organisation at the input and output stages. They are co-operators in the business activity. They are all channel members and they represent both the supply side and the distribution side. Some sources focus solely on supplier markets but channel members such as intermediaries and agents in the distribution market can have an equal impact on an organisation. (btob magazine)

If fully integrated channels are the most efficient {where a single organisation operates at every channel level}, then it is obvious that, where full integration is not possible, relationships must be developed within the channel. Even in services marketing, where channels may not exist to the same degree, this is vital. Package tour operators must have positive relationships with their suppliers (hotels and airlines, for example) and with their distributors (travel agents). Financial organisations must have confidence in brokers who trade in their services. Restaurants, hairdressers, auto-service stations and hotels must be on good terms with their suppliers to be able to operate effectively.

The objective of relationship building wit~ these groups is to develop cooperation and co-ordination between all the parties who can impact on the overall satisfaction of the business. Quality of service delivery is paramount, and suppliers and channel members play a major role in service quality.

Relationships with customers-CRM

Relationship marketing is also about building relationships with customers, rather than creating exchange processes. Customer contact should be maintained after the sale has been completed, and the focus is on retaining customers, rather than simply trying to attract new ones.

North West Securities, a financial services company specializing in consumer credit, telephones everyone of its credit customers three or four times a year. This telephone contact is used to check that the customer is still satisfied with the service they are receiving, and to update them with details of new services available. A 'freefone' number is given to customers who can use it to call any time, free of charge. They aim to maintain a high customer retention rate. Car manufacturers and dealers have long recognized the value of this type of after-sales marketing. Existing customers are invited to social events when new models are launched, and are contacted periodically by dealers anxious to maintain a 'front of mind' relationship. Manufacturers actually employ sales and marketing professionals to develop innovative after-sales strategies to increase customer retention. (The B2B battle:CRM Vs B2B)

Insurance companies developed this kind of relationship in the days when the 'Insurance Man' - the representative - used .to call on all his customers every week to collect payment. It was not unusual for the Insurance Man to become a family friend, and he was guaranteed all the family's insurance business, from life and savings policies through to pensions and funeral policies. Personal contact is still of critical importance in this market.

Referral markets

Another important influence on an organisation's performance is the level of business (or activity) arising from referrals. This is especially important in services marketing where 'word of mouth' recommendation can be a key factor in the consumer decision process. Frequently, referrals are informal- through family or friends, for example - but often they are more formal, as in industrial markets where specifies (who may be from outside the client organisation) playa major part in buying decisions. Architects or consultants .are often cast in the role of specifies when they advise their client where to source materials and services.

In consumer markets, formal referrals exist in many forms. The first-time buyer in the housing market may well take their estate agent's advice on which mortgage company to approach, and which solicitor to use. Travel agencies recommend which holiday tour operator will meet a customer's requirements. Insurance agents put forward the best policies for their clients.

Most organisations will find that a proportion of their customers come to them via a referral of some kind. For this reason, it is important to direct some marketing activity

.towards the members of the referral market - the specifies wherever possible. This is already done in many formal referral situations, where insurance agents and travel agents receive commission and. other incentives to ensure their support. The pharmaceutical industry spends massive amounts on promoting their products to doctors who act as specifies. (B2B Trust)

Where referrals are largely informal, however, it can still be possible to use innovative methods to develop this area. Health clubs invite members to introduce their friends for a trial session. If the friend takes out a subscription, the existing member receives some incentive, such as free sunbed sessions. The British Benefit Society (a Friendly Society specializing in savings and loans) offers small cash gifts to members who recruit further members. Existing customers can be the best source of referrals there is, provided that they are themselves experiencing high levels of satisfaction with the service they have received. This demonstrates again the potential power of relationship marketing.

Internal markets `

Relationship marketing may go further than internal marketing but it still retains a very clear focus on the needs and wants of the internal market. Service organisations, in particular, have to pay special attention to recruitment of quality personnel. Recruiting the individuals of the right caliber is not always easy, especially under the current demographic changes being experienced in the UK (and other areas) today. Recent forecasts show that by the end of the 1990s the demand for graduates will far outstrip the supply.

Evidence also suggests that prospective employees, like consumers, are becoming more sophisticated in their demands. A 1990 survey of marketing, administration and personnel professionals showed that in choosing a firm to work for, a socially responsible image and 'greed' policies were the most important factors.

Organisations need therefore to communicate with prospective employees the employee market. Building relationships with the employee market, especially through long-term positive visibility on the graduate recruitment scene, for example, can help to ensure the future well-being of the organisation.

In summary, relationship marketing is concerned with building long-term relationships rather than bringing about exchange processes. It is customer and market orientated, but it identifies a number of 'markets' which the organisation needs to understand and relate to. The organisation must design and implement strategies and programmes for successful relationship marketing. The markets which need to be addressed are as follows:

Customer - existing and potential

Internal markets

Influencers

Referral markets

Channel markets - supply and distribution

Potential employees

Conclusion

Any successful B2B strategy has to help the customer to be loyal and supportive to the firm and its products.  The  customer do  not  just get  a  need,  the  B2B marketer  have  to  help  the customer though getting him to feel a need and then buy the product and finally become loyal. When  a  B2B  marketer  wants  to  develop  strategy  driven  promotions  that  motivate  B2B customers, they have to find a solution to the problems with purchase barriers. First some key questions have to be answered; who is the true decision-maker at the targeted company; what excites the decision-maker; what is holding the buyer back. When these questions have been answered  then  the  type  of  promotional  strategy  can  be  chosen  and  the  sales  promotional technique derived will be depending on the company's objectives. (The B2B battle:CRM Vs B2B)

As well as quality, the other key aspect of relationship marketing is customer retention. Loyal customers who keep on re-purchasing are extremely valuable. Compared with the cost of attracting new customers through advertising, sales promotion and other means, any effective method of retaining existing customers who will continue to spend money with the organisation must be important.

A number of tools can assist in the process. An example of this is database marketing where customer-buying histories and other information can be listed on a database, and then referenced and cross-referenced in the future to target new products or promotions accurately. Another important aspect of the task of analyzing how to retain customers is to carry out market research amongst customers who have defected. Why did they go to a competitor? Why have they stopped using your service? The answers to these questions can hold vital information for services marketing managers.

Research is important to establish why customers defect, as studies have shown that a large proportion of dissatisfied customers never complain - they simply stop using the service. By the same token, customer complaints handling procedures should be properly carried out to ensure that the complaint is rectified and the customer is satisfied the necessary action is taken to prevent that .problem occurring again but the starting point is usually to examine the external environment and the changes taking place within it. The audit then gradually narrows its focus from the general aspects of the organization's marketing activity to the more specific, until, finally, specific problem areas or difficulties can be probed more closely if required. It is useful to understand the components identified above, and the main questions which should be addressed in the audit. The industries also need to take the marketing tool of customer relationship management seriously and provide proper focus to it. The CRM helps the organization to focus on the needs and the requirements of the customers. The CRM must ensure that the products and the services offered by the organization are proper response to the changes in the aggregate customer behavior pattern. The automobile industry also need to provide proper maintenance and after sales service to ensure good CRM. This analysis suggests that both are just two different verticals of establishing relations. They mainly differ in the approach; the idea behind both is the same.