Relationship Marketing in a Global Context
Literature Review
Concept of Relationship Marketing
Relationship marketing is the vital concept that is widely used by the companies for achieving customers’ loyalty or to make long terms relationship. In a similar manner, Alrubaiee & Al-Nazer (2010) stated that relationship marketing is the modern concept which is consider far better than the traditional marketing which focuses on sales rather than customer preferences.
That’s why relationship marketing is proving to be quite effective term that contributes high for the companies. According to Ashley et al., (2011) relationship marketing is the necessary step for the companies in the current scenario where customer preferences are constantly changing. To address these changes, it is important to understand their likes and dislikes through using relationship marketing tools.
Thus, this practice helps the company to update with the customers on the regular basis and allows attaining the competitive advantage against its competitors.
At the same time, Theron & Terblanche (2010) mentioned that the commitment-trust theory of relationship marketing also prove to be effective for the enterprises as it states that there are two fundamental factors that should be including in the relationship such as trust and commitments.
This is because it creates bonding with customers through timely meeting needs and preferences of them. this theory is also have positive effects as it builds goodwill in the market and it also spread positive word of mouth in the society. So, it is essential for the companies to consider the relationship marketing strategy for staying in market over the longer duration.
However, many companies uses the relationship marketing concept in their business process for achieving the customer loyalty such as coco-cola, lays etc.
Lays runs the “DO US a Flavour” campaigns in which they develop the chips flavour as per the customer votes. This marketing strategy added value in terms to retain the customer loyalty towards the brand. Therefore, relationship marketing is the crucial concept that is widely accepted by the companies for attracting and retaining the target market.
Basic tenants of relationship marketing
There are various tenants/ practices that is involve in the relationship marketing that’s build lifelong and profitable relationship. The basic practice which is commonly used in the relationship marketing strategy is the regular surveys and polls. According to Rasila (2010) conduct survey is the best tenant to develop the health relation with customers.
It is because through the surveys, personal observation methods, marketers able to gather customer information about its taste and preferences etc. Thus, this helps business to cater the needs of customers in an efficient manner. In support to this, Niculescu et al., (2013) receive feedback is also consider as a useful tenant under the relationship marketing as feedback guides the business about their product performances and customer perception towards the products and services.
Through the feedback, company can bring the improvements as per their demand and make consumers satisfy. Therefore, customer feedback is the valuable for the company to retain the customer loyalty towards the brand.
In addition to this, adding the innovation is also effective and it is done through integrating the new technologies. In a same concern Cobbs, (2011) usage of advanced technology is the best way to constantly connect with the larger audiences and identify their changing needs for incorporating into the product.
Technology plays a significant role in bringing the innovation into the product. From this, it can be say that embraces high-tech allows to adapt the innovation through directly contacting to multiple vendors, customers, prospects and partners.
In support to this, Lagrosen & Josefsson (2011) depicted that digital platform is the best example of high-tech in regards to directly connect with the vendors, customers and suppliers etc. It is estimated the digital platform is the current trend in the global market as through this platform, companies can cover the untapped areas.
Likewise, many western companies to tap the market of china use the digital platform as Chinese people are more cultured or custom oriented people. In that case, companies through the digital sites identify the local people interest areas and as per that they enter into the Chinese market. Through this way they also develop the long term relationship in the Chinese market.
On the flip side, the basic tenant that is follows extensively through the companies for building relationship is the introducing the sustainable practices in their business operations.
This sustainable practice also proves to be effective in terms to attract the customers, stakeholders in this increasing environmental problem. Due to growing environment issues, the companies moves towards the recycle, reuse method that’s save maximum waste from the manufacturing unit.
So, this tenant contribute positive to pull customers towards the brand and develop healthy relation with different stakeholder. As every people wants to join that business unit which produces that sustainable product that does not create any negative effect to the environment and health of the people. Hence, these are basic tenants which are incorporate by the companies while implementing the relationship marketing.
Role of relationship marketing within international business
In the views of Berthon et al., (2012) relationship marketing plays an important role for achieving the long-term customer engagement. The relationship marketing allows to focusing on the fostering of customer loyalty instead of just focusing on the short term goals i.e. sales.
This marketing strategy performs through identifying the customer needs and interest then satisfying them on the spot that’s create the solid bond. Moreover, open communication encouragement is also contributing high in making healthy relationship between seller and buyer.
In contrary to this, Cavusgil et al., (2014) argued that effective promotion and offers are the factors that plays significant role in developing the relationship as satisfied customers become the most effective promoter that provide positive word of mouth among different groups.
This creates the new customer base for the company. Furthermore, complementary offers such as discounts, schemes etc also contribute useful to repeat the sales or purchase of product.
Similarly, relationship marketing also provides support to the company in the international market. According to Samiee et al., (2015) international relationship marketing helps the business to build the trust factor over the foreign clients. It is quite important to create the trust due to differ in culture and traditions so in that case to develop the belongings is essential for the business to stay in international market.
Besides that, relationship marketing also provides support to spread the positive word of mouth promotion which enhances the goodwill of company among the international customers.
In the finding of Kim & Ko (2012), it is determined that international relationship marketing strategy also assist to adding value into the product. Likewise, companies use the digital platforms and social sites to understand the diverse people behaviour and attitude.
According to that they design their product. This strategy would help to easily accept the product by the individuals in the international market. So it can be depicted that relationship marketing helps to gain the long term achievement rather than to attain the long terms goals like sales, profit.
Depend on this, it is finding that relationship marketing strategy not only give the chances to develop the healthy relationship but it also allows the company to generate long term growth. This long terms growth assist the company to stay as a leader in market.
Contribution of social media in customer relationship marketing
The rise of social media trend makes a huge impact on the customers’ decision making towards the product chosen and become the brand loyal. This is because social media is the platform which allows the companies to understand the customer behaviour and attitude.
At the same time, it also guides the companies to get the response from the customers regarding the product and services. Based on that feedback, company incorporates the improvements into the product.
Basically, social site includes as a vital tool which contributes benefits to the company in regards to conduct market research without including huge expenses. That’s why it is consider as an effective in the research field. In relation to this study, Williams & Chinn (2010) illustrated that social media penetrates the diverse networks of group needs and preferences.
Through study their needs, they try to incorporate changes into their offering and it influences the customers positively. Basically, social media is considered as best source to which consumers can communicate, connect and collaborate with others directly.
In the views of Dunne et al., (2010), Facebook is the most used social sites as it has more than 100 million visitors per months and customers make it as their daily routine. In such situation, social sites give the opportunity to companies in terms of develop the healthy relation with customers which cannot be possible with only personal observations, surveys etc.
In the research of Zhou et al., (2013), it is identified that social media is a platform through which viewpoint is exchange easily. Likewise, many companies such as Zappos is the online retailer shoes, clothing and accessories company which focuses more on the social sites to make an healthy relation with their target audiences.
This is done by the company through make a facebook page with the name of Zappos in which they share their product information. At the same time, they also ask for the audiences’ response on the product or services offering. Zappos build the customer relationship through using the below mention page which clearly indicates the catchy lines which says that” let’s be in a like-like relationship”. It means that they treat their diverse customer equally and wants to make solid relationship with them.
Through this fan page, Zappos adapt the unique strategy as they ask the people to like their page and offer the audience to join their e-mail list. When any people click the like button then the custom tab changes and the page of sign up open and only by sign up that page customer able to look the list of product offering.
Thus, this is the distinct approach of the company to make a healthier and long term relationship. Other than that, social media also contributes in relationship marketing is in the form of managing customers complaints. However, social media is the efficient platform to deal with multiple complaints comparatively to written forms/ phone recording complains.
It is also find that complains and response of customers over the social sites reflects that customer loyalty as customer is taking interest into the brands that’s why individual have complains. Thus, complains is considered as a positive sign of customer loyalty. At the same time, it becomes easy for the company to answer each individual problem over the social sites.
This would help to develop the mutual relationship among the service provider and customers. In support to this, Alrubaiee & Al-Nazer (2010) believe that social media is not only about up selling but it also gives an opportunity for both cross selling. It means that companies through social sites not only focus on simply sales but it also gives an advantage to grab the right opportunity at the right time.
Besides that, social media is also helps the business to make the people aware about their product line through using various tools such as twitter, instagram, facebook. Likewise, JetBlue airways use the twitter to inform the passengers about flights time. Through this platform, customer constantly engage with their respective customers and such interactions develop the loyalty of particular customer over the brand.
In support to this study, Michaelidou et al., (2011) defined that social media is also uses for saving the termination relationship. However, in case customer goes for the termination then companies would use the social media in order to bring the improvements in their ability for spot the clients who is tend to leave the brand and move towards the other brand. So it is stated that social media prove to be effective for finding the customer who is dissatisfied and pursue to terminate the relationship.
Furthermore, Heller Baird & Parasnis (2011) social media is also contributing in the influencing the purchasing decision of customers. This is because social media promotes the open conversation between the services provider and customers which clears all kind of complains of customers.
At the same time, it also allows the company to understand the customers’ experiences and discuss about their preferences which they look into any particular brand. Basically, this platform provides continuous engagement between the different parties that’s helps in influencing the buying decision of customers.
Apart from this, this platform also gives the opportunity to retain the customer over the longer period of time through catering their every changing need and demands.
According to the Engel, Kollet, Backwell (EKB) model, there are five steps that consumers follows when making the purchase. First step is input where consumers attract from the marketing material which they see in the advertisement. Once the consumer collect the data from the information processing then they compare the input from the past experiences and expectations.
After that, consumer moves towards the decision-making and take the buying decision. Consumer also affected by the external factors such political, social and cultural etc and these are the factors that guide their purchasing decision. In a similar manner, Liang et al., (2011) estimated that currently maximum customer before purchase any product goes on the social sites like facebook; twitter to see their product background history.
This makes them more clear that product will suite them or not. Thus, social media is becoming the current trend to review the product and according taking the buying decisions.
In the views of Hennig-Thurau et al., (2010) social networking sites also help the organisations to tap the international market. This become possible because now global audiences is on the social sites so it becomes easy for the companies to build the relationship by studying about their culture, traditions and based on that they offers the customers.
Hence, it helps the company to efficiently enter into the international market. Due to increasing craze of social sites, small business units also get the opportunity to build their relationship with customer and get recognition in the global platform.
It is done through conduct the research of particular area with the help of twitter, instagram, facebook as these sources guides the small enterprises to collect facts about their cultural by analysing their dressing style, habits & preferences (Garrigos-Simon et al., 2012). Thus, social sites also contributing benefits for the small business units who want to capture the both local and global market. Therefore, companies by using the social sites fulfil diverse needs of customers and build the cordial relationship between the buyers and sellers.
In the findings of Spry et al., (2011), it is estimated that social media meets the expectation of customers through developing the campaigns like create Facebook page, share product information directly to customer through different tools of social media, discuss about the features of product and services on twitter.
Through this campaign, companies create the healthy relationship with customer and make them loyal towards the brand. At the same time, there are two ways through which the trust and commitment factor about the social media create among the customers. Celebrity endorsement contributes high in making people believe about the particular brand.
Likewise, Celebrity promotes their brand with the help of twitter so with this there fans also get influences and develop the trust on particular brand (Dwivedi & Johnson, 2013). Other than that, broadcasting does cover covers the particular areas through controls as per the regulations of government. Similarly, social media is also a broadcasting which is also regulated by the legal authorities. So this also creates the trust among the customers about the authentication of social media.
Due to social sites, it is authenticated and regulated by the higher bodies, the companies find it as a suitable platform to contact larger audiences and market the product. Social media is allows the companies to connect with the people through sending their links to them.
Such strategy helps to make customer attracts towards their offering and create the interest of customers. If the customer create the trust among the customers then it becomes quite easy to generate the relationship with customers. However, this can be possible only when the company regularly update their customer about the product information and its price. Then, it creates positive impression on customer and that’s make them loyal towards the brand.
According to Paswan et al., (2011), it is determined that product information, feedback, addressing customer’s complaints over the social media contributes towards the development of relationship marketing.
For instances, companies through Twitter or Instagram share the images of the product and allows customers to choose the colour or feature of product that’s practices also provide support in terms to create the relationship with customers. Based on these facts, it is depicted that elements such as sharing or exchanging information over the social media tools considers as a suitable platform for building the healthy network. Thus, the linking of these entire activities gives rise to the relationship marketing.
From the literature review, it can be summarised that relationship marketing is the key factor for developing the healthy and long terms relationship between the buyer and seller. There are various practices that is company uses in the relationship marketing is the complementary offers, conduct market research, promotions etc.
Besides that, social media is considered as most influencing factors that contribute high in creating the long term bond. This platform gives the opportunity to company to constantly engage with the customers and allows to making them satisfy. Thus, it is stated that relationship marketing strategy has a great impact over the business.
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