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?

In response to David Collis' blog...

In regards to Panera Catering..."What about you, would you rather get a generic mix, or exactly what you want?"

I also enjoyed the way Panera did it's "catering", but I agree that it is really more of a delivery. Many catering company's usually do not let you order separate items, making it more of a large group purchase, but it was much more convenient to be able to choose what we wanted. I think if I was having Panera Cater a large event I would not have people choose what they wanted individually because I can see that getting confusing. I would probably just order large amounts for everyone to share. With a small order, such as within our class, I think it was nice that we all got to pick just what we wanted. I don't know if Panera should consider this "catering" though, because when I think of catering, I think of them coming and setting up the food and everyone sharing he same kinds of food. I think this is more of a delivery service.

Do you think this should be considered catering or delivery? Should Panera start doing a delivery service with a smaller minimum so you can order from home? Would you order Panera more often if they delivered?

Selecting A Good Brand Name

There are several very important factors that marketers must consider when selecting a brand...

1. The name should be easy for customers worldwide to say, spell and remember. Short and simple brands with the same word meaning worldwide usually satisfy this requirement, such as the laundry detergent, Cheer.

2. The brand name should indicate the products major benefits and suggest in a positive way the products uses and special characteristics; negative or offensive references should be avoided. Research shows that names that produce a positive benefit are more likely to be bought. Such as Dirtdevil which indicates it cleans up any dirt, versus a name that has nothing to do with cleaning, like the new vacuum, the Dyson ball.

3. The brand should e distintive. Without a distinctive brand, it will not stand out from all the other products. Marketers should find a brand name that is compatible with all products within there product line.

4. The brand should be designed so it can be used and recognized in all types of media. Whether through the radio, tv, or conversation the brand shouldbe easily recognizable. Such as the McDonalds, "golden arches."

Brand names are tricky and many companys have special teams that creat these names.

What do you think the best brand name or symbol is? Why?

In Response to Arianne's Post...

Can you think of a time when you bought something on impulse?

There have been many times when I have bought something due to impulse. Many times, my feelings and timing will be the reasons as to why I buy impulsively.

Today, while I was returning a pair of shorts at the mall, I decided to stop into Sun glass Hut and look around. I didn't necessarily need any new sunglasses but right as I walked in I spotted a pair that I liked. After trying them on I went top the cashier and bought them. When i left the store I was happy with my purchase but now when I think back on it, I realize that I probably should have looked around for a better price or something I liked even better. The sunglasses were rather pricey and I feel as though since I was in the mood to shop and I haven't really bought anything recently, i ignored the price and just went for it. If i hadn't bought them i could have found a better price somewhere else.

I am not unhappy with my purchase and my post purchase mood is pretty satisfied, but I think I need to work on my impulse buying because this is one of the many times I have done that. Impulse buying is a problem because hen I go to buy something that I actually want and have shopped around for I won't have any money left.

What moods affect your impulse buying? Do you tend to shop better in a good mood or bad mood?

Psychological Influences on the Buying Decision Process

Psychological influences help determine people's behavior and influence their behavior as consumers. Most of the psychological influences are internal, but they can be affected by social forces externally. The most common psychological influences are perception, motives, learning, attitudes, personality and self-concept, and lifestyle.

Perception is the process of selecting, organizing, and interpreting information inputs to determine meaning. Our information inputs are the sensations we experience through sight, taste, hearing, smelling and touch. Marketers use advertisements, smells and touch to encourage consumers to buy or use there product or service. For example, when you walk by a restaurant and smell the food cooking, if it smells good, you will be more influenced to go eat at that restaurant. Westin hotels are using certain fragrances that evoke serenity and tranquility in there lobbies to attract guests. Because of selective exposure, which is the inputs we select or ignore, an individuals current set of needs affects there decisions. Many fast food restaurants are there commercials around dinner time, to encourage customers with that need of hunger. Another way of using selective exposure, is when bars hold beer specials on the weekends, because that is the time that most people will be going out and drinking.

Motive is an internal energizing force that orients peoples activities towards satisfying needs or achieving goals. According to Maslow's hierarchy of needs humans strive to satisfy there physiological, safety, social, esteem and self actualization needs. These needs influence are motives every day. Motives can be different depending on the time of the day. Most people have motives for cup of coffee in the morning rather than before bed. Other motives a person may have are price, location or customer service at a particular store.

learning refers to changes in a persons thought processes and behavior caused by information and experience. When buyer's purchase a product, they have certain experience with it. After this experience they can learn whether they like this product and will buy it again, or whether they dislike it. For example, the new commercials that Domino's has out, show what people are saying about there pizza and how they don't like certain parts of it and wouldn't eat there again. Fortunately Domino's has changed there pizza but that is just an example as to how people have reactions of certain products.

An attitude is an individuals enduring evaluation of, feelings about, and behavioral tendencies toward an object or idea. attitudes play a very important role for a company. When consumers have a bad attitude about a company they tend to not use the product, and through word of mouth can influence others attitudes towards a company. For many company's, doing surveys and research on consumers attitudes will help them improve there products, customer service and gain more customers for them.

As we grow up and try new things, we learn and develop attitudes and perceptions of different products. Company's can change your perceptions though by using colors, scents, sounds and feelings to enhance our inputs and change our attitudes.

What is an attitude you have towards a store or product? Have you ever noticed your perception being changed on purpose through certain sight or smell?

In Response to Ryan Beall's Post...

Do you believe it's unethical for a company to give personal information out, such as this instance, if there is fine print at the bottom stating that your information may be distributed?

I believe that it is unethical for a company to sell information, but if it is in fine print then they really are not being unethical. Obviously many people do not read the fine print, including myself, but as long as the company has it there somewhere where you are putting your information, then they have every right to sell your information and do whatever they want with it. Personally, I tend not to give my information out, I even have a separate e-mail account for company's that ask for my e-mail so that way it will not fill up my regular inbox. I think that people now a days need to be more careful about who they give information to. There are so many scandals and identity thefts every day. If people are aware of who they are giving information out too and if they read the fine print or even ask if there information will be distributed then the company has every right to sell it. The consumers just need to start being more careful about where there information is going.

AMA Statement & John Smith

John Smith is faced with a difficult dilemma. In my opinion I think although it is not ethical John would be better off selling the names of the people he surveyed. So many people are surveyed about different things every day that the people whose names got sold probably wouldn't even know that it happened. Also it would help his company and the 75 employees who work there. If he did not sell the names, he would ultimately have to lay people off, which would cause many family's economic hardship because they are the sole "breadwinners" in there family. In order to keep his company running successfully and the employees that he has stay there, it makes sense to sell the surveyed names for $8,000.

In terms of the AMA statement of ethics, It stresses honesty, responsibility, fairness, respect, transparency and citizenship. If John sells the names to the car company he is going against many of these terms and breaking ethics.

Unless he tells all of the surveyed people that he will be selling there names to a car company than he is not being honest. According to the AMA you must strive to be honest in all situations, and he definitely would not be being honest. Responsibility is a little different though. If he does sell the names then he is being responsible in terms of his company and trying to keep it going and not lay people off. To me that is responsible when he is helping his employees.

All in all, I believe that if John sells the names of the surveyed people he and his company will benefit, but in doing so he will be breaking ethical standards.

If you were in John's position, how much money would they have to offer for you to sell the names?