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Close to the Customer: but is it Really a Relationship Assignment

1. The article is about the idea of relationship marketing. The paper reviews how the concept has been viewed by marketing authors and draws from social psychology to shed light on the characteristics of relationships. Such relationships are usually long term, but they do not necessarily always have to be. In this article the author is mainly discussing customer relationships, but the same approach can also be used when dealing with other parties, such as suppliers, distributors, co-producers of customer solutions, financial institutions and political decision makers. It may be necessary for a firm to establish relationships with such parties to supply its customers with appropriate solutions.

It examines the idea that relationship has spent years in dealing with end consumers, it is in the field of business-to-business marketing that the idea of establishing long-term relationships has had a long history of acceptance and effective practice. It discusses three theorists’ views on the area. Such as Turnbull and Wilson (1989) who advocated the establishment of long-term buyer-seller relationships through the creation of structural and social bonds between the companies. And also offered is a theory by Han et al (1993) who seem to view close relationships not as barriers to exit or a way to “lock in” in a possible-unwilling customer, but as part of the shift towards ‘partnering’ with single-source suppliers, the benefits of which include enhanced performance, purchasing cost reduction and increased technical cooperation. They also discuss that the most successful buyer-seller relationships appear to be characterised by mutual trust between buyers and sellers, based on exchange of information and commitment.

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The next section the article looks at is at questioning relationships. It talks about that there is a lot of writing on relationship marketing has left important questions unanswered. Such questions are raised such as what is the true nature of a relationship, where does transactional marketing end and a relationship begins? Can a relationship be said to exist with a bank or an airline or a supermarket? And then the section goes on to discuss what other people have said such as Hogg, Goldberg and Berry.

The article then discusses that many authors have observed that certain conditions must be met for a stable and positive relationship to exist. It talks about how much can be learned from social

psychologists who have written widely on relationships. For example, Duck (1991) identified several essential elements of a relationship, which included caring, support, loyalty, placing priority on other’s interests, honesty, trustworthiness, trust in the other, giving help when needed, and working through disagreements.

The last part of the article discusses the next stage of the research into relationship marketing. The author examines areas that need to be looked at such as:

* When can a relationship truly be said to exist between a company and its customers;

* What conditions must exist for a customer to feel that he or she is involved in a genuine relationship with a business, rather than feeling trapped by circumstances over which he or she has little control?

After he poses these questions the author talks about the research to be carried out. Such as a sample of consumers will be asked to rate each of the selected interactions on dimensions such as those mentioned above, using a Semantic Differential Scale, thereby providing a measure of the nature of the interaction as perceived by the consumer.

He ends by saying that the results of the research should enable the researcher to identify those situations where the customer believes a relationship exists or has the potential to exist.

2. In service competition, marketing is not restricted to marketing specialists. It is spread throughout the organisation, and part time marketers almost invariably outnumber specialists in, for example, market research, marketing communication and sales.

The article brings up many questions about the type of research that has been undertaken to it becoming published.

Firstly the main part of the research is secondary research. The author applies a lot of what he says to theorists views. Especially in the section ‘relationship marketing as ‘locking-in’ the customer’. The author uses six different views of theorist’s to back up with what he is trying to say.

I did find the article very repetitive. I know the point of what the author was trying to say but he did tend to repeat himself in places.

I did not see the point of adding the section titled ‘from vending machine to Gynaecologist: Approaching ‘my’. It had some relevance to the article but just thought it was an example that did not need to be there. It did not prove anything the author was trying to get across to his audience.

I did feel in a way that the article was very much out of a textbook. It is broken down well but it does read like an academical book that would be used to study from.

The section titled ‘What does the customer say?’ I thought was very interesting. To find out how organisations find out how to improve their relationships is a good thing for companies to know. I did like the part that he used examples such as ‘..positive comments include observations such as: “they go out of their way to help”, “they talk with me”, and “they are honest with me”. It is good for companies to hear what customers do say about the service or product they offered.

I found the last part of the article very interesting. I thought the idea of supplying some ideas of research for further study on the subject of Relationship marketing. The questions raised were very concise and well thought out.

So to conclude about the article, I feel the author did answer the question set at the start but I feel I could have easily picked up a textbook on the same subject and found the answer out from that and did not need to read a published article that was mainly written from secondary research.

3. The organisation I have chosen to discuss and use the ideas and concepts from the above article to be applied to that organisation is McDonalds.

The reason why I have chosen McDonalds is because the organisation is very much customer focused. Relationship Marketing is based on managing customer relationships (as well as relationships with other parties). However, in much of the literature on the subject the questions “what is a relationship?” or “when do we know that a relationship has developed?” are not discussed.

Relationship marketing is based on managing customer relationships. One thing is clear, although it does not seem to be obvious to many practitioners of relationship marketing: a relationship with a customer has not been established only because the marketer has said it has.

One way of defining when a relationship has developed is to measure how many times a given customer has made purchases from McDonalds. If there has been a number of continuous purchases, one might say that a relationship with this customer has been formed. And of course, repetitive purchases by a customer can be a sign of the development of a relationship between the firm and this customer.

McDonalds believe in quality customer service and that is believed to be the way all over the world where they are based. As the company are originally based in America, the customer quality is made mandatory to all units.

In examining the role of relationship marketing within McDonalds, the theory set by Petrison and Wang (1993) link the establishment of a relationship with customers directly to the availability of database technology, suggesting that the roots of relationship marketing lie in the ability of companies to know their customers, their likes and dislikes on an individual basis, thereby enabling them to ‘target’ the customers more effectively..

McDonalds are always trying to make their services and products more available to more customers by lowering their prices and providing a quality service at the counter when ordering food and also whilst sitting in the eating areas of the restaurant area.

In the article it states that Congram (1991) refers to relationship building as the ‘service counterpart of brand loyalty in consumer goods’. But it appears to be some fundamental aspects of a relationship missing from McDonalds. Repeat business alone does not constitute brand loyalty, in that there may be many reasons why a customer would purchase from them over and over again. The customer may deal with them because it is convenient to buy their food from there, they like the food or they like the prices. Although the brand is bought regularly, the customer cannot be said to be loyal to it. How do McDonalds know that although the said customer bought their food from them one day they are not going to Burger King the next day or simply going to the local supermarket to buy a sandwich.

Far too often people in an organisation, such as McDonalds, view customers as an anonymous mass. Customers are seen in terms of numbers. McDonalds are set targets for how many customers they are receiving in their restaurants and also set target budgets. When someone stops being a customer there is always someone else to take his or her place.

From the customer’s point of view, however, every single customer forms a relationship with the

seller, which the firm should develop and maintain. All businesses are based on relationships. However, customer relationships do not just happen by magic; they have to be earned. The same goes for distributors, suppliers and other partners.

The best possible way for McDonalds to learn what their customers want is to hear what they want. They could start by asking the customer indirectly by customer care forms or by improving their service by customer complaint forms. They could also hold focus groups to see what their customers said and taking on board what they have to say to improve their service.

An integral element of the relationship marketing definition is the promise marketing. According to this, the responsibilities of marketing do not only include making promises and thus persuading customers to act in a given way. A firm like McDonalds is preoccupied with making promises may attract new customers and build new relationships to begin with. However, if promises are not

fulfilled.

The evolving relationship cannot be maintained or enhanced. Keeping promises is equally important as a means of achieving customer satisfaction, retention of the customer base, and long- term profitability. It is also important to notice that promises are given, and should be fulfilled, mutually. Finally, the firm has to take action to make sure that it, either by itself or together with network partners, has the resources, knowledge, skills and motivation to keep promises.

Finally, taking the research that is stated at the end of the article could easily apply to McDonalds.

They could use the questions that are posed to add more quality to their customer service. Especially can a relationship be said to exist between a company and its customers or is the relationship really with the company’s employees? McDonalds seem to train their employees very well but do they train them well enough in customer service.

It is anticipated that a detailed context analysis of the results of the focus group interviews will reveal a long list of words and sentences which might represent the way in which customers describe their relationship with a variety of service providers in several industries.

The interaction between McDonalds and its customers is characterised by certain aspects of the transaction and the type of exchange, which takes place, and by the perception, which the customer has of that exchange.

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