Relationship Marketing

Relationship marketing is basically a focus on customer relationship management. it uses information about customers to create marketing strategies that develop and sustain desirable long term customer relationships. Because of the growth of technology, relationship marketing has expanded from not just face to face interaction, but e-interaction also. The goals of relationship marketing are simple, to find, attract and win new clients, nurture and retain those that the company already has, entice former clients back into the fold and reduce the costs of marketing and client services. Relationship marketing has been strongly influence by re engineering. according to the re engineering theory, organizations should be structured by complete tasks and processes rather than functions. Traditional marketing uses the marketing mix, but according to Ian Gordon's book on relationship marketing, "the marketing mix approach is too limited t provide a usable framework for assessing and developing customer relationships in many industries and should be replaced by the relationship marketing alternative model where the focus is on customers, relationships, and interaction over time, rather than markets and products."
Relationship marketing is so important to company's, and should be one of the main goals of any company. In a study found in the Journal of Retail Banking, it showed that a 5% improvement in customer retention can cause an increase in profitability between 25 and 85%. These increased profitability's in good relationships occur for many reasons, but some are:

• free word of mouth promotions from valued customers
• customers who are satisfied tend to stay with the company and are less likely to go to another competitor
• regular customers are less expensive to service, because they are familiar with the process of buying, so they need less education and therefore less company time.
• customers who are happy, make employees happy, in return happy employees make happy customers.

(above from the European Management Journal)

all in all, good customer relationships cause less hazards within the company. The company will have increased profitability, better customers, and happier employees. For me, I think that relationship marketing is the most important thing a company can do.

Do you think company's should focus more on relationship marketing? What company's do you think have strong customer service and therefore have good relationships with you or others?