Relationship Marketing and winning customer loyalty
The concept of Relationship Marketing was introduced by Leonard L. Berry in the eighties. In the same period, other researchers devoted their efforts to studies that related new forms of partnerships between companies. Presenting a significant reformulation in the B2B ( Business-to-Business) environment and between companies and customers in the B2C ( Business-to-Consumer ) environment.
Relationship Marketing Levels
Berry and Parasuraman define Relationship Marketing as attracting, developing and later retaining customers , highlighting three levels:
This third level is characterized by services of greater value to the customer, usually linked to technology. At this stage, the company seeks to help customers become more efficient.
With the evolution of Relationship Marketing, a change of focus was observed in the Marketing area, placing the customer at the center of everything.
Trading is no longer just transactions. There is now a great emphasis on relationships, privileging a partnership between company and client , aiming at a long-term relationship.
It is important to highlight that to achieve this lasting relationship, mutual trust between company and customer is a fundamental requirement.
Relationship Marketing Goals
Zeithaml and Bitner emphasize as a primary objective of Relationship Marketing “the building and maintenance of a committed customer base that is profitable for the company. To achieve this goal, the company must focus on attracting , retaining and strengthening relationships with its customers”.
The customer also wins in this retention process and not just the company. The achievement of loyalty also favors the company's customers from the moment they perceive more value in a company than in the competitor.
In relationship marketing, attention remains focused on the quality of the relationship between the company and the customer, because customer satisfaction and loyalty are more significant in this process.
Trust and commitment
Morgan and Hunt attribute the success of Relationship Marketing to two main variables: trust and commitment.
These variables have the function of generating results based on efficiency, effectiveness and productivity for the company. Conquering thus, participatory behavioral reactions that determine a successful relationship marketing for organizations.
A strong tendency can be observed on the part of companies to not only focus their efforts on winning new customers and satisfying them, but also investing in lasting relationships to keep those who are already customers.
customer loyalty
Customer loyalty is a desired factor for companies. And along with this, it is of great interest to analyze the financial value that the customer represents to the organization throughout their relationship.
The concept of loyalty is linked to a relationship between customers and companies that remain together for a long time, that is, a long-standing issue.
The definition of loyalty is formed by two perspectives: attitudinal and behavioral . It is important to mention the differences in these perspectives. Attitudinal loyalty is related to emotions and feelings; on the other hand, the behavioral one is linked to the concept of repurchase.
Oliver draws attention to an important relationship between retention and loyalty, noting that there are situations in which the customer is loyal even without buying again.
Phases of the loyalty formation process
To facilitate the understanding of these two perspectives, the process of loyalty formation will be approached according to this author, which is composed of four phases: cognitive, conative, affective and action.
The cognitive phase is the most superficial. Which is constituted by prior knowledge related to a product or service and which can change at any time.
The affective phase has as its main characteristic its relationship with brand affection . Generating a positive attitude. The degree of affectivity is related to the consumer's commitment to the brand.
The conative phase is related to the different experiences with the brand, generating repurchase intention.
And the last phase described by Oliver is the action phase – in this step, it is observed that the existing intentions in the previous three phases are converted into repurchase actions.
Companies that focus on the customer need to be aware of performance indicators that are: satisfaction, loyalty, marketshar and profitability.
When a company delivers superior customer value, it earns customer loyalty and increases market share.
Companies that gain loyalty and retention achieve more profits and therefore more value. It is important to note that customer retention does not always generate loyalty.
Loyal customers buy more from the same company, increasing sales volume. Attracting customers and earning their loyalty is a very important step, for this it is necessary to keep a focus on the result for customers.
Conclusion _
Organizations know that customer acquisition and retention are highly relevant factors for the company, but on the other hand, many are unable to value the relationship between loyalty and profitability.
Companies that manage to win the loyalty of their customers consequently have higher profits and grow faster.
Increasing profitability does not only depend on gaining loyalty, but also on the following factors: lower acquisition cost, increased profit, operating cost savings, positive word of mouth and differentiated pricing.
We would like to know: what is your experience with relationship marketing in your company? Leave your comment.
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