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Chapter 10

Chapter 10. Relationship Marketing, Customer Relationship Management (CRM), & One-to-One Marketing. Chapter Objectives. Contrast transaction-based marketing with relationship marketing.

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Chapter 10

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  1. Chapter 10 Relationship Marketing, Customer Relationship Management (CRM), & One-to-One Marketing

  2. Chapter Objectives • Contrast transaction-based marketing with relationship marketing. • Identify and explain the four basic elements of relationship marketing as well as the importance of internal marketing. • Identify each of the three levels of the relationship marketing continuum. • Explain how firms can enhance customer satisfaction and how they build buyer-seller relationships • Discuss hw marketers use grassroots and viral marketing in their one-one marketing efforts. • Explain customer relationship management (CRM) and the role of technology in building customer relationships. • Describe the buyer-seller relationship in business-to-business marketing, and identify the four different types of business partnerships • Describe how business-to-business marketing incorporates national account selling, electronic data interchange, vendor-managed inventories (VMI), CPFaR, managing the supply chain, and creating alliances. • Identify and evaluate the most common measurement and evaluation techniques within a relationship-marketing program.

  3. The Shift from Transaction-Based Marketing to Relationship Marketing • Transaction-based marketing • Buyer and Seller exchanges characterized by limited communications and little or no ongoing relationship between the parties • Relationship marketing • Development and maintenance of long-term, cost-effective relationships with individual customers, suppliers, employees, and other partners for mutual benefit

  4. Customer relationship management • The combination of strategies and tools that drive relationship programs, re-orientating the entire organization to a concentrated focus on satisfying customers • Internal marketing • Managerial actions that help all members of the organization understand and accept their respective roles in implementing a marketing strategy • Employee satisfaction

  5. The Relationship Marketing Continuum

  6. Enhancing Customer Satisfaction Ongoing Measurement Customer Feedback Understanding Customer Needs

  7. Building Buyer-Seller Relationships • Many customers are seeking ways to simplify their lives, and relationships provide a way to do this • Customers find comfort with brands that have become familiar through their ongoing relationships with companies • Such relationships often lead to more efficient decision-making my customers and higher levels of customer satisfaction

  8. How Marketers Keep Customers • Retaining customers as far more profitable than losing them • Customers typically generate more profits for firm with each additional year of the relationship • Frequency marketing • Affinity marketing

  9. Database marketing • Benefits include: • Selecting the best customers • Calculating the lifetime value of their business • Creating a meaningful dialogue that builds genuine loyalty • Interactive television • Application Service Providers • One-to-One marketing • Grassroots marketing • Viral marketing

  10. Customer Relationship Management • The combination of strategies and tools that drive relationship programs, reorientating the entire organization to a concentrated focus on satisfying customers • Managing Virtual Relationships • Retrieving Lost Customers

  11. Buyer-Seller Relationships in Business-to-Business Markets • Business-to-business marketing involves an organization’s purchase of goods and services to support company operations or the production of other products • Buyer-seller relationships between companies involve working together to provide advantages that benefit both parties • Advantages might include the lower prices, quicker delivery, improved quality and reliability, customized product features, and more favorable financing terms

  12. Choosing Business Partners • Partnership: an affiliation of two or more companies to assist each other in the achievement of common goals • Buyer partnership • Seller partnerships • Internal partnerships • Lateral partnerships

  13. Improving Buyer-Seller Relationshipsin Business-to-Business Markets • National Account Selling • Business-to-Business Databases • Electronic Data Interchange • Quick-response merchandising • Vendor-Managed Inventory (VMI) • Collaborative planning, forecasting, and replenishment • Managing the Supply Chain

  14. Business-to-Business Alliances • Resources and Skills That Partners Contribute to Strategic Alliances Resources

  15. AssessingCosts & Benefits Measure-ment & Evaluation StructuringRelationships Evaluating CustomerRelationship Programs • Lifetime value of customerthe revenues and intangible benefits that a customer brings to the seller over an average lifetime, less the amount of money which must be spent to acquire, market to, and service the customer

  16. Additional evaluation techniques: • Tracking rebate requests, coupon redemptions, credit-card purchases, and product registrations • Monitoring complaints and returned products and analyzing why customers leave • Reviewing reply cards, common forms, and surveys • Monitoring "click-through" behavior on Websites to identify why they stay or leave

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