Literature Review for RM

8/3/2019 Literature Review for RM

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LITERATURE REVIEW TITLE :

INFLUENCES OF RELATIONSHIPINFLUENCES OF RELATIONSHIP

MARKETING IN ENTREPRENEURSHIPMARKETING IN ENTREPRENEURSHIP

ANG WAY FERN 804367

GOWRI A/P SELVAM 804368

LEE CHENG CHYE 807779

LEE KOK ZHI 804372

LEE YOU WAN 806252


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Understand the influences of relationship

marketing in entrepreneurship

Understand Why RM more successful tobe implement in SME or small business

Understand the gap and its significance

Understand the important of RM inEntrepreneurship

EXECUTIVE SUMMARYEXECUTIVE SUMMARY


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IntroductionIntroduction

Definition1) Entrepreneurship means the capacity and willingness to

undertake conception, organization, and management of

a productive venture with all attendant risks, while

seeking profit as a reward

2) Relationship marketing is a strategy designed to foster

customer loyalty, interaction and long-term engagement.

-Focuses more on customer retention

than customer acquisition.

-designed to develop strong connections with

customers by providing them with information

directly suited to their needs and interests and

by promoting open communication.


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Introduction:Introduction:The article, Entrepreneurship Strategies That Use Three

Basic Steps for Building Your Entrepreneurial Business by Rob

Saballus

Step 1. Build your list of prospects by

giving something of value upfront.

Step 2. Develop a strong relationship

with your prospects

require to develop a strong

relationship with your prospects, RM

could help to develop the relationship

with its employees, supplier,manufacturer, distributors and also

customer to ensure that they provide/get

better productivity in its management,

better offer, better price and provide the

best services to its customer.


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Step 3. Market your product or service

to your prospect list using the principles

of attraction marketing.

RM plays an important role by making

your customer as a fans which help to

promote your promote by recommendto their friends and relative.

This indeed the most powerful

marketing method.


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ReviewReview

RM is not the same as entrepreneurship. not all the entrepreneurs will practice relationship

marketing, and not all the entrepreneurs able to

implement good relationship marketing.

It is depends on whether the entrepreneurs able toadapt relationship marketing into their entrepreneurial

environment or not.

Todays, company change their traditional marketing

concept to relationship focus.


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ReviewReview

The Marketing Strategy Optimum [7]

Transaction Focus Relationship Focus

Single sale Customer retention

Discontinuous customer contact Continuous contact

Focus on product features Focus on product benefits

Short term scale Long term scale

Little emphasis on customer service High emphasis on customer service

Limited commitment to meeting customer

expectations

High commitment to meeting customer

expectations

Quality is the concern of production staff Quality is the concern of all staff


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ReviewReview

Entrepreneurial (SME) practicing RM will have the followingresponses/thinking:

1. General profile of the SMEs

Have a greater relationship marketing focus

Have almost twice as many full time employees

Experienced greater growth in the last 3 years2. Defection Analysis

2-30% fewer customer from their customer base compared to their

competitors

3. Entrepreneurial orientation (Schumpeterian behavior)

Have been more focused on innovative behavior in the last year and appearto wish to continue to be so in the future

Are significantly more innovative and adventurous

4. Importance of communicating with customers

Communicate to determine customer needs

Communicate to ask for referrals


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ReviewReview

5. Awareness of customer needsAre more aware of customer needs

Informing and training employees on customer requirements

6. Improvement from close relationships

Achieved improvements by developing other business opportunities

7. Internal incentives

Reward their employees with both monetary and non-monetary schemes

Promoting employees based on performance and experience

8. Cost associated with acquiring new customersDo not use discount pricing as a promotional strategy to gain new customers


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ReviewReviewT

he Marketing/Entrepreneurship Matrix

MARKET SITUATION

Continuous Discontinuous

DISCOVERY OF

NEEDS

Perceived Needs

Traditional

Marketing

(A)

Strategic

Interface

(B)

Unperceived Needs

Opportunistic

Interface

(C)

Pure

Entrepreneurism

(D)


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It Gap and its SignificanceIt Gap and its Significance

In contrast of transactional marketing, relationship marketing focuses

more on establishing, developing and maintaining successful

relational exchanges and good customer relationship.

gap exists between theoretically and practices as below;

i. hard to achieve win-win situation where there will be a party withmore bargaining power will have the say and cause the other

party gain less benefit from the relationship.

ii. communication barrier as not all customers will like to share their

experience on the consuming process.

iii. difficult to establish a unique type of relationship which other

competitors could easily imitate their style and practices.

iv. A lot of capital will be needed in order to be competitive against

the track of similarity in the same industry.


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ADVANTAGES

Special pricing

Customization of product and services

Development of special products and services

Joint coordination of workflow

Information sharing

Taking over the customers business process.

- Achieve mutual benefit by means of risk reductions, share resources,

innovation, learning, social relation, lead time, price reduction andincreased profitability.

-Its all about meeting customers expectations and converting them into

content and loyal customers.

- repetitive sales and hence growth of the business.


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DISADVANTAGES

Blois (1998:256-270) summarises the five possible negative factor or

disadvantages of engaging a relationship put forward by Hakansson

and Snehota (1995) as following:

i. Loss of control

ii. Indeterminateness

iii.Resources demanding

iv.Preclusion from other opportunities

v. Unexpected demands


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Potential ContributionPotential Contribution

RM plays an important role in business market and this practicecontributes a lot especially to the entrepreneurs.

Many entrepreneurs establish their own firms when they

recognize a specific market demand. However, some of these

entrepreneurs are unable to fulfil the market demand with theirown resources and means.

In order to succeed, the entrepreneurs must established

relationships with others (business partners-strategic alliances

and also customer).

Cost of establishing a new relationship in their business is much

higher than developing and maintain successful relations which

the factors of long-term prosperous benefits both parties or

several parties is very significant.

.


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Potential ContributionPotential Contribution SME is considered to have small production and business capacity.

Therefore, they can save their cost in doing marketing strategy for

new customer acquisition.

customer loyalty or RM is still a major focus for SME type of

marketing strategies no matter is business-to-business or business-

to-customer relationship.

However, entrepreneurs must understand whether customer loyalty

in their firm or industry is substantially driven by customer

evaluations of relationship or customer commitment to the

relationship.

In the absence of this knowledge, they may embark on

expensive relationship or marketing enhancement

programs that will be doomed to failure.

.


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Entrepreneurs must develop and implement Customer Relationship Management Programs (CRM)

Customer Information System (CIS)

Loyalty Management Program (LMP)

For example, by creating of individual customer profilewhich stated down the customer preferences, purchasing

and consuming habit to better meet the customer needs

and expectations.

As in the market, we can see there are many entrepreneursor their salespeople are having underlying friendship with

the clients and we could define it as psychological rewards

between the parties.


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In future, there is a need for the researchers and thepractitioners to understand RM roles particularly in specific

service industry and retail industry as well as determine the

specific variables that construct the RM quality or perspective.

It also includes the role and conditions of the component of

customer commitment.

John Day (1998), for the SMEs, the more important variable in

RM to be considered is the entrepreneurial orientation.

More appropriate is the consideration of the link between RMand the entrepreneurial capacity of SME. Rather than define the

entrepreneur as what we describe, it is better to say that they are

what they do.

3 dimension: risk taking, innovation and proactiveness.


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ConclusionConclusion The RM concept is more wide where it will include the relationship build

between supplier and the company, among the staff internally and also

among the customer relationship.

directly affect the organization and management of a productive

venture while seeking profit as a reward.

RM help the company to get the best deal from the supplier, having

understand the needs of the customer and continue to grow to a higher

level to meet the customer demand and at the same time having more

fans.

Successful entrepreneurs have to practice relationship marketing fully

in order to make the competitive difference.

The intense competition among firms in the new global environment

has made RM inevitable for a SME or small firm to seek ways to create

and maintain quality relationship with customer..


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ConclusionConclusion

Company who practise RM will be more ready to adopt changes and able to

compete better in competitive global marketplace - supported by the results

from initial research suggest that entrepreneurial enterprises employ

relationship marketing more effectively than less entrepreneurial

organizations and they derive commercial benefits such as higher growth

rates and fewer customer defections.

RM is a crucial factor to make a company success and it could also play an

important role in entrepreneurship.

Many entrepreneurs are now seeing the 4Ps as too product-oriented and

have adopted the 4Cs marketing mix.

Place becomes Convenience

Price becomes Cost to the user

Promotion becomes Communication

Product becomes Customer needs and wants


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Q & AQ & AQuestion to my friendsQuestion to my friends

Do you think RM is important toDo you think RM is important to

entrepreneurs?entrepreneurs?

Documents

Literature Review for RM