Relationship Marketing

Relationship
Marketing
Definition
Relationship marketing is a strategy
designed for customer loyalty, interaction,
and long-term engagement to be fostered.
It is designed to develop strong
connections with customers by providing
them with information directly suited to
their needs and interests by promoting open
communication. (Forbes.com)
Definition
Relationship Marketing includes activities
aimed at developing and managing trusting
and long-term relationships with larger
customers. (Customer profile, buying
patterns and history of contacts are kept in
a sales database) (Serrano, 2016)
Definition
Relationship marketing involves creating,
maintaining and enhancing strong
relationships with customers and other
stakeholders. It requires that all 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.
(Gilaninia, 2011)
Five Different Levels of
Relationship
1. Basic. The company salesperson sells the
product but does not follow up in any way.
2. Reactive. The salesperson sells the

product and encourages the customer to
call whenever he or she has any questions
or problems.
Relationship
3.Accountable. The salesperson phones the
customer a short time after the sale to check
whether the product is meeting the
customer’s 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.
Relationship
4. 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.
5. Partnership. The company works

continuously with the customer and with
other customers to discover ways to deliver
better value.
Characteristics of
Relationship Marketing
1. It focuses on the long-term rather than the
short-term.
2. It focuses on partners and customers rather
than on the company’s products.
3. It puts more emphasis on customer retention
and growth than on customer acquisition.
4. It relies on cross-functional teams rather than
on departmental-level work.
5. It relies more on listening and learning than
on talking.
Benefits in Developing and
Implementing Customer
Relationship
1. Consistent customer experience
2. Customer Feedback
3. Customer Profitability
4. Customer advocate
5. Innovation
Benefits of Relationship
Marketing
In the business world, retaining customers has a
lesser cost at least eight times compared to
acquiring new ones. Thus, this marketing
capitalizes on the same fact and is beneficial to
the company in several ways.
Marketing
A. Understanding customer characteristics; - the company
can segregate its customers into groups based on their
characteristics like purchasing power, frequency and
volume of sale transactions. It also helps the company
get valuable feedback from its customers and
understand their needs and expectations.
B. Delivery and meeting expectations - if the company
knows what its customers’ needs are, it will help reduce
wastage due to trial and error methods. It is easier to
create a product if the features and specifications of the
product are known.
Marketing
C. Repeat Business - Sellers should maintain good
attitude to the buyers. By doing this, buyers will feel
that they do not need to switch sellers.
D. Prevents negative transition. - Trust and loyalty go
hand in hand and it is super beneficial for all business.
It will help prevent customers from turning to
competitors.
Marketing
E. Word-of-mouth marketing
a. Increasing customer base - satisfied existing customer
is 100% more likely to recommend a product/service to a
prospective customer. Apart from customer, referrals,
there are several other ways to increase customer
satisfaction by employing methods of utilizing social
networking websites, blogs, informal surveys, benefits on
loyalty cards, timely response to complaints and
requests as a constant reminder of its presence around
and retention equity is improved by enhancing customer
satisfaction.
Marketing
F. Reduced marketing cost - benefits also include lesser
marketing costs and more value creation. This can be
explained by stating the following statistics: every 5%
increase in customer retention can increase a company’s
annual profits from at least 25% to as much as 125%,
while simultaneously leading to a reduction of 10% in
marketing costs. An existing customer will spend 33%
more than a new customer to buy a company’s
product/service.
Marketing
G. Identification with the company - the benefits are
reaped both by the company and the customers. It helps
customers identify more with the company. Keeping your
communication lines open and keeping in touch with the
customers makes them feel like they are being valued. It
will keep customers coming in and build brand equity
for the company in the long run.
H.Product Market Expansion - the company’s
employees must be ready to deliver beyond the
company’s boundaries on customer demand.
To further explore the concept learned today and if it
possible to connect the internet, you may visit the
following links:
Topic: What is Relationship Marketing?

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Relationship

2. Reactive. The salesperson sells the

5. Partnership. The company works

Topic: What is Relationship Marketing?

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