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Contemporary Relationship Marketing
Contemporary Relationship Marketing
Relationship Marketing and Management
Relationship marketing is a form of marketing that shifts focus away from sales transactions to emphasize customer satisfaction.
Illustrate the basis for and application of relationship marketing in the short and long term
- Relationship marketing is cross-functional, in that it is organized around processes that involve all aspects of the organization.
- 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.
- Customer relationship management involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing, customer service, and technical support.
- A key principle of relationship marketing is the retention of customers through varying means and practices to ensure repeated trade.
- demographic: A grouping of people for statistical purposes, based as age, race, gender, etc.
Relationship Marketing & Management
Relationship marketing is a form of marketing that shifts focus away from sales transactions to emphasize customer satisfaction. It refers to a short-term 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, personalized purchase. Thus, relationship marketing uses this experience to create stronger ties between buyer and seller. Relationship marketing is cross-functional, in that it is organized around processes that involve all aspects of the organization. It 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. Examples of markets in which relationship marketing can be crucial include:
- Internal markets
- Supplier markets
- Recruitment markets
- Referral markets
- Influence markets
- Customer markets
With the growth of the internet and mobile platforms, relationship marketing has continued to evolve and move forward as technology opens more collaborative and social communication channels. This includes tools for managing relationships with customers, which go beyond simple demographic and customer service data. 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. Relationship marketing extends to include inbound marketing efforts, public relations, social media, and application development. It is a broadly recognized, widely implemented strategy for managing and nurturing a company’s interactions with clients and sales prospects. The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service.
Customer Relationship Management
Customer relationship management (CRM) is a widely implemented model for managing a company’s interactions with customers, clients, and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing, customer service, and technical support. Once simply a label for a category of software tools, today CRM generally denotes a company-wide business strategy embracing all client-facing departments and beyond. When an implementation is effective, then people, processes, and technology work in synergy to increase profitability and reduce operational costs. A CRM system may be chosen because it is thought to provide:
- quality and effeciency
- a decrease in overall costs
- an increase in profitability
Successful development, implementation, use, and support of CRM systems can provide a significant advantage to the user, but often there are obstacles that obstruct the user from using the system to its full potential. A CRM attempting to contain a large, complex group of data can become cumbersome and difficult to understand for ill-trained users. The lack of senior management sponsorship can also hinder its success. Stakeholders must be identified early in the process and a full commitment is needed from all executives before beginning the conversion. Additionally, an interface that is difficult to navigate or understand can inhibit the CRM’s effectiveness, causing users to pick and choose which areas of the system to use and which to push aside. This fragmented implementation can cause inherent challenges, as only certain parts are used and the system is not fully functional.
A key principle of relationship marketing is the retention of customers through varying means and practices to ensure repeated trade. This is accomplished by satisfying customer requirements more effectively than competing companies through a mutually beneficial relationship. Customer retention involves counterbalancing new customers and opportunities with current and existing customers as a means of maximizing profit. Many companies in competitive markets will redirect or allocate large amounts of resources or attention towards customer retention. In markets with increasing competition, it may cost five times more to attract new customers than it would to retain current customers.