Relationship Marketing: Meaning, Levels and Approaches of Relationship Marketing

Meaning of Relationship Marketing

Long-term partnership between marketing expert and customers is called marketing relationship. It maintains satisfactory relationship with customers to earn long term goodwill and maintain it. Creating maintaining and increasing good and strong relationship with customers and stakeholders is relationship marketing.

Relationship marketing includes increasing strong relation with customers, keeping contact and enhancing it. Relationship marketing gives emphasis on establishing valuable relationship and creating delivery network with them rather than personal dealings. Relationship marketing is long term oriented. 

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Relationship Marketing and Customer Development Process

The main objective of relationship marketing is to continue long term delivery to the customers and measure their satisfaction. All the departments of a company should work as a group with marketing to provide services to the customers. Relationship should be maintained with economic, social, technical and legal sectors. It helps to increase the reputation of the company and its products or services. In relationship marketing, marketers and customers work together to identify customers' wants and needs and meet those by updating them in marketing mix.

According to Philip Kotler and Gary Armstrong, "Relationship marketing is the process of creating, maintaining and enhancing strong, valued-laden relationship with customers and stakeholders."

For the last some years, the companies have realized the importance of relationship marketing and are practicing it. Nowadays there are many customers, they are living and spreading all over the world. They want such suppliers who can provide goods at any place, any time and can solve problems and bring improvement in quality of the products living nearby them. Relationship marketing fulfills these wants of the customers.

Levels of Relationship Marketing

Different levels are created while buying goods by the customers. They are: basic level, reactive level, accountable level, proactive level and partnership level.

Levels of Relationship Marketing

1. Basic level

At this level, the seller sells products to the customers. But do not establish relationship with them anyway. They only sell products to them.

2. Reactive level

At this level, the seller of the company sells goods to the customers and encourages them to ask if they have any problems and questions. At this level, the sellers become ready to solve problems of the customers after selling goods.

3. Accountable level

At this level, the seller phones the customers a short time after the sale of check whether the product is meeting the customers' expectations. They solicit for suggestions if any improvement is necessary.

4. Proactive level

At this level, the seller and other employees phone the customers from time to time with suggestions about improved product use. They find out whether the customers are satisfied with the improved products or not. If they are not fully satisfied, they will ask for suggestions and advices.

5. Partnership level

At this level, the company works regularly with the customers to find out methods for delivery of products. At this level, the company takes the customers as partners.

Approaches of Relationship Marketing

Financial benefits, social benefits and structural ties are the approaches of relationship marketing. They are made clearer by the following figures:- 

Approaches of Relationship Marketing

1. Financial benefits

The first approach is to provide financial benefits to the customers to strengthen relationship with them. For example, an airline may give special discount to its regular customers by scheduling regular flights. Hotels may provide special discount to their regular customers. Similarly other business organizations may provide discount or prize to their regular customers. Some organizations provide several facilities to their regular customers by giving them membership of their club. Strong and deep relationship can be established with the customers by giving such financial benefit.

2. Social benefits

The second approach of relationship marketing is social benefits. Relationship with customers can be strengthened by providing social benefits to them. Business company develops personal relationship with the customers for the same purpose by this approach. It confers them social respect and recognition. The company identifies wants and necessities of personal customers, and makes marketing mix accordingly. Besides financial benefits, the social benefit strategy strengthens relationship with customers as well.

3. Structural ties

The other important approach of relationship marketing is structural ties. Its main objective is to involve customers in organizational structure. In order to develop effective relationship with customers, special equipment or marketers supply with special equipment or computer linkage that help them manage their order, payroll and inventory. Electronic Data Interchange (EDI) should be developed. The medicine wholesaler, McKesson Corporation had invested millions of dollars to develop EDI to systematize inventories, orders and shelf space of small pharmacies. That means, a company should even spend much capital to establish strong relations with customers, maintain it and involve them in the structural tie.

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Quality Marketing: Tools and Requirements for Quality Marketing

Meaning of Quality Marketing

The age of today is the age of quality. The producers have become aware to produce quality goods or services in order to get success in competition. Quality is such a factor which increases costs if quality is increased, whereas quality declines if production cost is decreased. So, balance should be maintained in production cost and quality.

For this, the producers should study and understand the consumers' interest, wants, purchasing power and competitors' position carefully.

The sum of features and utilities of any goods is called quality. The quality of goods satisfies the consumers' wants. Reliable service, long lastingness, favorableness, workmanship, aesthetics, composition etc. are the qualities of products. Quality of all goods does not become same. Different goods of different qualities are produced according to the needs, wants, interest and purchasing power of the customers.

Goods of different quality may be produced to meet the same need. Different writers and scholars of marketing have defined quality; the important definitions among them are given as follows:

According to Dr. R. Spriegal, "The quality of a product may be defined as the sum of a number of related characteristics, such as shape, dimensions, composition, strength, workmanship adjustment, finishing, and color."

According to American Society of Quality Control, "Quality is the total of features and characteristics of a product or services that bears on its ability to satisfy stated or implied needs."

Hence, it becomes clear that quality of product is the sum of characteristics inherent in it. Cost, performance, reliability, workmanship, long-lasting, aesthetics etc. are the aspects of quality. Strategic commitment, involvement of employees, quality of products, technology, quantity, methods etc. affect quality of any product.

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Concept of Quality and Total Quality Management (TQM)

To implement the concept of Total Quality Management (TQM) in marketing is called quality marketing. This plays an important role to satisfy customers. Decision on how to implement the decisions taken to increase the quality of product or service should also be taken. Quality of goods is the very important issue being faced by the sum of efforts made by an organization to increase quality of products or services. TQM pays special attention towards satisfying customers. Quality circle, training, customers' views, strategic role, bench marking, statistical tools, technology use etc. increase quality. Strategic commitment, employee involvement, quality materials, new technology, improved method, group effort etc. are the major elements of quality marketing. In the absence of such elements quality marketing becomes impossible.

In conclusion, the sum of characteristics and utility of the goods or services is called quality. To implement the concept of Total Quality Management in marketing is called quality marketing. So, quality marketing makes efforts to increase the quality of the goods or services. It also denotes the quality of goods or services, quality of distribution and distribution channel and quality of after sale services. Quality marketing uses different tools to increase quality of products or services.

Tools for Quality Marketing

Quality marketing is customer oriented concept. It gives priority to customers' satisfaction. Goods or services as wanted and desired by the customers should be made available at right place, at reasonable price and at right time to satisfy the customers. This is the main philosophy of quality marketing. The main tools for quality marketing are as follows:-

1. Quality circle

The quality circle is also called quality control circle. Quality circle is an important tool of marketing. This was developed in Japan in 1960s with a view to providing suggestion to the high level management. Quality circle is the group of employees working in same organization. Such group may consist of 5 to 12 members. This group works regularly to increase quality of the product. As experts of different subjects are involved in such group, it becomes very effective. The group members know the method of solving any problem, methods of using technology and method of performing any work in group with responsibilities. So, the quality circle is the group of employees who get together, hold regular discussions on the quality related issues, find out reasons, recommend solution and take reformative steps. The working process of this group becomes stepwise. Identifying problems, selecting problems, analyzing problems and recommending the right solution is as a whole the working process of quality circle.

2. Training

Responsibility for quality improvement should not be left on any single person or single department. All the persons involved in the organization should be active and involved in it. All the employees from chief executives to the lower level workers should know about the quality of products, and all of them should be committed to achieve it. For this regular training should be given to the employees. Quality is compulsory for success. All the employees should know the necessary conditions for quality and should be given knowledge how it can be achieved. What is quality? Why is it necessary? How can quality be achieved? Who are responsible for maintaining or increasing quality? All such things should be made known to the employees through training.

3. Consumers' ideas

Quality of products or services is for consumers. So, the quality should be as expected by the consumers. They are wise and rational. They know everything about goods or services. Their help becomes very important in developing new product, adding new characteristics to any products. So, their ideas should be collected, analyzed and quality of goods should be produced accordingly. Various ideas of many consumers should be collected and the best idea should be implemented to maintain the quality standard, and make qualitative improvement in any product compared to competitors' products. As a result, the products become marketable.

4. Strategic role

The other important tool of quality marketing is strategic role. The marketers should get the opportunity to play strategic role to make quality goods. If such role is not available, the function of quality remains limited in papers. Quality should be in goods but not in advertisement. The marketers should make goods or services qualitative playing strategic goal.

5. Statistical tools

The measurement of the quality of goods or services is its level and regularity. Quality has different levels. They should not be distorted but be maintained regularly. If high quality goods have been supplied to markets once, quality of the same goods should not be decreased later on. So, statistical tools can be used for giving regularity to the quality. If quality has been regularly maintained, the customers feel satisfied. As a result, organizational success can be achieved.

6. Benchmarking

Benchmarking is the process of learning how other firms do exceptionally high quality things. If any competitor has produced high class goods and has given regularity, the process of learning their method and imitating them is called benchmarking. The concepts of benchmarking are simple and easy. From this good method of others can be learnt and used.

Requirement for Quality Marketing

Quality marketing is the demand of time. Strategic commitment, involvement of employees, quality materials, new technology, improved method and group efforts are needed for quality marketing.

1. Strategic commitment

Strategic commitment is a necessary element of quality marketing. Top level management should be strategically committed to producing quality goods. Such commitment brings changes in the culture of organization to adopt the quality as its goal, not as an ideal. As a result, there comes stability and regularity in the quality of goods or services.

2. Employees' involvement

The other important element of quality marketing is the involvement of employees. Quality is not a responsibility of any single person or department; it is the result of group efforts and commitment of all the employees working in the same organization. So, all the employees should remain effortful to produce quality goods. Considering this fact, the top level management should involve all the employees in the campaign or mission for quality production.

3. Quality materials

Quality cannot be achieved only through involvement of employees and strategic commitment. For this quality materials are also needed. If the input materials are of low quality, final goods also become of low quality. So, quality materials should be used to maintain quality of any products.

4. New technology

New technology is found improved every time. So, it becomes necessary to produce quality goods. The quality of the goods produced by using new and high technology becomes uniform and has reliability. US auto and Electric Firm has invested much amount in developing new technology to enhance quality.

5. Improved method

Quality cannot achieve only strategic commitment, employees' involvement, quality materials and new technology. For this improved method is also needed. The process of production becomes flexible in improved method. It should be easy to change according to the changes of environment.

6. Group effort

Evolvement as well as commitment of all employees becomes essential to increase quality and maintain regularity in quality. A group should be formed involving the persons who are able to solve problem, use new technology, use statistical tools and work in group. This group is called quality control circle. Such group can be formed involving employees from different departments. The group is given special rights and responsibilities for quality control. This group works to maintain quality, promote it and keep regularity. So, group effort is compulsory for quality marketing.

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Promotion Decisions in Nepal for Successful Marketing

The promotional works give information to target market about the organization and its products, influence them and remind them about the company and its products. Promotion gives complete information to the prospective customers about quality of goods, price, using/handling methods, benefits etc.

Like in other countries, the customers are provided information about products, so is in Nepal also. Promotion is an important element of marketing. Its role is increasing daily. The main elements generally used in practice are as follows:

Related Topic:

Meaning and Objectives of Promotion

1. Advertising

Sellers make various artistic presentations in order to sell their goods, the same is called advertisement. It makes flow of information about goods or services and gives necessary information and knowledge and reminds the customers of the goods or service. So, advertisement has become very popular in promotion of goods or services. This generally used by business firms, social organizations, government and governmental organizations. In order to have mass selling, mass communication is necessary. Nepalese entrepreneurs/producers use different types of advertising media which are mentioned as follows:

a) Print media:

Print media are used to give information to the customers or consumers about products or services. This media include newspapers. Notice, attitudes, ideas/views, descriptions etc. can be published. The many potential customers study such materials. Gorkhapatra, Kantipur, Nepal Samacharpatra etc. are its examples. A large number of customers or consumers look at such newspapers in city areas. But in remote villages, the customers or consumers cannot read such materials since most of them are illiterate.

Magazine is also included in print media. Information about goods or services can be given to the customers or consumers by publishing poems/verses, articles, notices, descriptions etc. in commercial booklets, fortnights, bulletin, journal etc. Such publications attract attention of all customers. House magazine, business journal etc. of the Chamber of Commerce and Industry, Nepal, Himal, New Business Age Core Express, are some examples of Nepalese magazines. Information, advertisement and messages of business firms become comparatively long, descriptive, analytical and explanatory in such type of print media. They may be difficult to understand for the customers living in villages.

b) Audio media:

Information and messages about goods or services also can be broadcasted/ disseminated through radio. So, this medium is also called radio advertisement. Consumer goods, sports goods, household goods, small equipment, etc. are advertised. Radio advertisement has become very popular in Nepal. All the potential customers of all parts of the kingdom can hear and understand notices, messages, description, etc. at a time. So, the Nepalese business firms give priority to radio advertisement.

c) Audio-visual media:

Audio-visual medium is also used to advertise goods or services in Nepal. Information is given about the quality, utility, price, benefits, using methods etc. of the goods which is intended to sell. Colored pictures, scenes of the products are attractively presented decorating at right place through this modern media. Such type of presentation attracts potential customers and wins their heart. Nepal Television is the strong example of audio-visual media in Nepal. Nowadays advertisements are given in front, in the middle and in the end of news.

d) Visual media:

Information and messages about goods or services can also be communicated by pasting posters. Posters can be prepared by writing or printing information or messages with colored pictures and pasted on walls, public places etc. Posters attract the attention of the customers. Such posters are also pasted and exhibited at Tripureshwor Stadium, Pokhara Stadium, Airport, Highways, Bypass roads bus stops etc. Advertisements can be made through bill boards, hoarding boards, etc. at different places such as airport, bus stops, super markets and other important public places. But such boards are located only in some city areas. Electrical signs are also used for advertising goods. Generally, such advertising media are in practice in Nepal.

2. Publicity

The function of providing information and messages about products, company's policy, programs etc. without any fee to the customers is called publicity. Such publicity is made by other sectors than the concerned organization. Such advertisement done through any person, organization, or group becomes reliable and trustworthy for the customers. This type of publicity has also become very effective as well as popular in Nepal. Programs such as press conference, display/exhibition, inauguration by ministers or socially respectable persons etc. are also used for publicity. Organizing annual ceremony of business firm, presenting annual reports etc. also become effective to publicize any company's products or services. This method of advertisement is also practiced in Nepal.

3. Personal Selling

Personal selling is also an important as well as effective tool for promotion. In this method, customers are directly contacted and communicated the messages about company and products. Potential customers are met and the goods are described to them. This is also supposed to be very effective means of promotion. It creates demands in potential customers. The personal seller should be skillful. Personal selling is Nepal has become effective in city areas and has begun to enter in some villages.

4. Sales promotion

Besides personal selling, advertisement, publicity, propagation, and other activities can also be conducted for sales promotion. Among them efforts for creation of demand, promotion of company etc. can be taken. Consumers' promotion, trade promotion, sales force promotion etc. methods should be used to make it effective. Gifts, price-off discount coupon distribution etc. can be provided to attract customers towards goods or services. Most of the Nepalese businessmen have used these methods.

Trade promotion is the second method of trade promotion. In this method, middlemen/intermediaries and channels are encouraged. Allowances, cost free goods, price cut/discount facilities are given to different channel members and sellers to encourage them in selling. Producer can also encourage dealers, wholesalers and retailers by providing facilities. Such activities have become successful to increase sale quantity in target markets in Nepal. Sales force promotion is the third method of sales promotion. It encourages the manpower/sales force involved in selling. The employees/sales forces are encouraged through arrangement of gifts, bonus and commission, sales contest etc. The promotional methods become very effective in sale of goods or services. So, most of the business organizations have used these methods of sales promotion.

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• Process and Areas of Marketing Research

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