Relatioship Marketing places customers at the center of the company’s focus integrating elements such as 360-degree marketing, micromarketing, product customization, etc.
This strategy aligns well with the type of diffusion we want. Relationship marketing is market oriented, customer committed and create, develops and maintain relationship with them. Client and provider roles are not fully defined and are flexible. Disintermediation, search for value creation and a strong emphasis on customer service are some of their characteristics.
Relationship Marketing requires a complex, ongoing internal marketing, an interconnection between major functions and marketing mentality across the organization. Relationship marketing considers target audience not only consumers but also dealers and after-sales service.
A new trend extends the scope of Relationship Marketing to suppliers, competitors, government, media, etc. We consider this new approach as a more effective way of creating a fully integrated relationship environment in a sort of holistic view of the company’s position (see SRM – Stakeholder Relationship Management).
The ultimate goal of relationship marketing is customer loyalty. Modern companies award value to each of its customers based on its CLV – Customer Lifetime Value – or net present value based on the returns offered in the customer’s estimated life cycle. But often they forget that the most valuable element of a loyalty process – affiliated programs – lies in the importance of the client as product prescriber.
Everybody knows that it is five times more expensive to get a new customer than keep an old one – a golden rule to build a long lasting company. However, dissatisfied customers are much more belligerent. Some studies show that unhappy customers transmit its dissatisfaction to an average of nine people. Others show to be much more skeptical when buying, a client who has bad reference about a certain product than the customer who conveyed its dissatisfaction.
If everyone agrees that the greatest gains in productivity will draw by implementing a strategy based on Web 2.0, what then is the reason to wait so long for such a coveted takeoff?
There are several reasons but for those who already know the benefits, it comes from the fact that particularly middle management, but also by high-level executives (technocracy), fears to lose their institutional power – the blurring of power is an intolerable threat.
Today it is simply unrealistic to envisage that an organization changes, turns upside down and becomes flat, not hierarchical, horizontal communication channeled, democratized in their status. Technological tools for this are already developed but they can just provide support, never be able to undertake such a change. It is a full-scale cultural change – someone will say that requires a redesign of the human essence.
For large organizations, is more effective to start this process in a new business or product line by creating a new division, start-up or so where this new concept can be put into practice with the required mentality and a brand new organizational design not influenced by the main office.
Another common case is that of medium-sized companies wishing to acquire international visibility but do not have large advertising budget allowance. These companies can perform tactical actions such as a preliminary to its strategic reorientation by creating a specific department.
Small firms are more flexible and easier to deal with change processes. Only one condition to meet, the owner must be convinced of the benefits of this new strategy and commit to take it forward.
The benefits are many and varied type but one of the most important is to “feel” the market.
At Bridgedworld we analyze the company potential, help define the new positioning, establish tools and channels and deploy a set of actions during the period deemed necessary.
This is Consulting and Interim Management. This is Bridgedworld.