RELATIONSHIP MARKETING: THE DAWN OF NEW ERAPRESENTED TO:Prof. Atul TandanPRESENTED BY:Nikhita KanwarManpreet KaurSurinder SinghVinay DhirVarinder Virdi

DEFINITIONSRELATIONSHIP: is the state & art of connection between persons & things.

MARKETING: The ability to create & retain a customer, at a profit.

RELATIONSHIP MARKETING: Form of marketing, developed from direct response marketing campaigns which emphasizescustomer retentionand satisfaction, rather than a dominant focus on sales transactions.

RELATIONSHIP MARKETING: A TOOL IN B2B MARKETING It is a business relationship between 2 companies actually it is network of relationships.

If the relationship between 2 organizations could be viewed as a FOCAL ONE, number of secondary relationships, concerned with the marketing of products & services are observed.

It is slowly creating an identity of its own, it is an useful strategy that can provide substance to its identity.

CREDIBILITY FACTOR: Quick growth of brand in the market. Huge potential available Multi product focus of many companies. Increased awareness levels of consumers.

INDUSTRIAL MARKETING: Pluralistic buying behavior. Technology & applications major role. Segmentation depends on product or service Enhances brand value by creating satisfied customers

BUYING CENTRE & RELATIONSHIPS:No. of buying is important from pre-sale stage tothe post-sale stage. Buying stages are:

Initiator: He initiates the purchase process. Influencer: Brings in buying influence. Decider: Final decision taker. Gatekeeper: Controls the flow of information. Buyer: Personnel's who formalize the buying process.

THE CUSTOMERS PERSPECTIVE OF RELATIONSHIPCustomer Requirements:The period during which customers are in a relationship with the marketers may be long. Opportunities to strengthen the relationship occur just before, during, after the transactions.

Customers also distinguish between major contacts & less important ones

Levels of relationship : It includes the following:

MEDIA: Through which the contact takes place.FREQUENCY OF CONTACTSWITH WHOM IS THE CONTACT: Organization or individual.SCOPE OF EACH CONTACT: Subjects covered.INFORMATION EXCHANGED WITH CONTACTSOUTCOMES OF EACH CONTACT: For seller & customer bothCOST OF EACH CONTACT: Money, time, stress, other factors.

Marketers Perspective to Relationship

Ability to Monitor

Different Roles in Customer Relationship The Role of Customer InformationLearning from ExperienceKnowledge of CustomersKnowledge of the Organization

Changing Indian MarketThe Old

Products were developed to enter new Markets

Brands were built to have differentiated associations.

Communications were used to convey brand associations

Relationships were less important than sales.

The New

Products are developed to meet customer needs.

Brands are positioned to offer distinctive value.

Communications are used to create expectations of value.

Relationships are to offer lifetime customer value.

EXAMPLES OF RELATIONSHIP MARKETINGWelcome group of Hotels

Marico Industries

Nestle India

PREREQUISITES FOR RELATIONSHIP MARKETING The three Es of relationship marketing:Empathy

Eagerness

Empowerment

WINDS OF CHANGE NEW ORIENTATION

Relationship marketing today requires building a new perspective. This perspective would call for dealing with one customer at a time.It would imply selling to a single customer, as many products as possible. The market must concentrate on building a unique relationship with individual customer. The marketer must segment the market carefully to decide which customer are more valuable.

CHANGES FOR THE ORGANIZATIONTransforming the perspective of looking at the marketStructure changeChange in decision making processAttitude change

CHANNEL RELATIONSHIP For the marketer, building a proper, fruitful and functional relationship is a critical factor in determining the effectiveness of the channels performance.

DATABASE AND INFO-TECK

Use of information technology for building a database on each individual customer.Offers a complete information profile & the needs of customer.Concept of a database is the ability to collect information, organize, analyze and segment it so that the right people are targeted for the right product. A marketer should be making use of a variety of ways to gather data about a market.

The goal is to access a customer record and know instantaneously what products that customer has or does not have, what his preference and how best to deal with him in the future.

SINGLE POINT SERVICE STRATEGYCustomer wants a single interface with his supplier & not dealing with several different departments.The relationship manager is designated to have access to enough resources and backup to resolve any problem the client needs to tackle.

STEPS IN RELATIONSHIP MARKETING

STEP 1:RECOGNIZING YOUR KEY CUSTOMERS

Target the customer who uses the product frequently.Interested in getting something in return.Depend on the value addition the company can deliver.Understanding the key customers needs and desires.Example: Lacoste India, Opel Astra Club, Pantaloons

OBTAINING FEEDBACKRelationship marketing is deeply anchored on the concept of collaboration.

Different methods of obtaining feedback:Surveys either personal, telephone or mailMystery shoppingCustomer suggestions or comment cardsFocus groupsToll free phone numbers

STEP 2: REWARDING YOUR KEY CUSTOMERS

Much used in the service industry.Loyalty reward schemes.Loyal customers.

3 steps to rewardsIdentify best customers.Divide and Reward.Stay up to speed.

PARTNERING FOR LEVERAGE Partnering is a process of collaborative teamwork to achieve measurable results through agreements and productive working relationships.

Example : Carlson Rezidor Hotel Group, Tie-up of British Airways with Taj Hotels

STEP 3: REACHING YOURKEY CUSTOMERSCold CallingE-mail MarketingSocial MediaSearch Engine Optimization

PITFALLSScale of operations makes bigger corporations slightly impersonal in their dealings.Tends to become impersonal and invade the privacy of individuals.It may involve in considerable capital investment with no guarantee of return.

How Much Difference Does Good Relationship Marketing Make ?Kinds of contracts customers perceive they have with your company. Known as contact audit It shows the frequency with which the customer contact occur. Also indicate if the customer are being put off by expected difficulty.

Outcome of these contacts are, in terms of relationshipThe company will realize that a positive outcome leads to better Relationship Marketing.To provide positive outcome many policy matters come into play such Use of customer information Which provide right solution

How customers react to these outcomes

Complex area Realized by well handled complaints or time taken to adjust to a customers needsReinforces the purchasing behavior Satisfaction leads to recommendation,The key here is to estimate change in lifetime behavior of the customers affected and those they tell about it.

Tactical vs. strategic application of relationship marketingMore effectively used as strategies and transforming the way business is done

These strategies factors too must be considered in payback calculations.

Competitive Superiority Established By building and exploiting a database with comprehensive coverage

Their existing and potential customers for current and future products and services

Alternative Sales Channels Companies can utilize Relationship Marketing to solve this supply problem.

Relationship Marketing can reduce cost of sales through application such as telemarketing, mail order, enquiry management and the like.

In the finance retailing industry, companies like Burlington Catalogue are taking to mail order as opposed to traditional means of retailing and mass media advertising.

Barriers To Market Entry Business may find themselves unable to enter a market.

As high quality database hold by competitors.

Some cases this database can b unique assets.

Conversely, possession of a relationship marketing is the key to enter new markets

New Products And Services

Relationship Marketing is by itself creating new products and services.

Credit card companies tie up with a lot of corporate houses to utilize their database.

Qualifying Relationship Marketing In Competitive strategy formulation Relationship Marketing is most frequently used to achieve either one or both of the following objectives

Revenue defense and development Cost Reduction

Relationship Marketing must therefore be identified and quantified

category of customer Category of products Application introduced Category of change Time period category of staff, function or marketing channel

Qualification Process

Target opportunitiesA shortlist of target opportunities for managing customers better is to be prepared. These involve Recognizing workflow or changing organizational structure.Re-engineering process.Policy development within existing functions, department , products groups, etc.Opening up of internal communication channels.Revenue development opportunities.Revenue protection ideasQuality control measures.

Cost Changes A comprehensive exercise is required to gather and analyze cost information

The aim is to quantify costs which may be changed by relationship marketing approach.

This exercise is carried out by questionnaires, interviews and by analysis of financial and operating information relating to the channels of communication and distribution.

Examples of cost change Sales staff are spending their time

Time spent on low productivity compared with time spent on high productivity activities

Such as time spent converting high potential customers or preventing their loss.

Sales revenue productivity statistics to measure the productivity of the time actually devoted to your customers

Data on market size

Data on how the activity profile of your sales force changes when you implement relationship marketing and put relevant applications to work.Data on current cost of managing the sales force.Information on how the activities which generate these cost affect the productivity of your sales staff.Information on how relationship marketing disciplines will lead to a change in nature and scale of these activities