Challenges in Implementing Relationship Marketing:
Although the concept of relationship marketing is quite easy to understand, the implementation part could prove difficult, due to many factors that need to be addressed during the implementation phase. Some of the critical issues in the implementation of relationship marketing are discussed below.
The first issue is related to maintaining real-time contact with the customers i.e. is reducing the time gap between customer query and the reply/ solution by the organization. Efforts should be made to reduce the time gap levels to zero at least in communicating with the customer. The next issue is related to motivating customers to switch over from low-value products to high-value products. Often incentives are provided to the customers whenever they switch to high- valued products.
Conversion of prospects into customers and making them loyal to the company’s products and services is one of the key challenges of marketing. Producing customized products and services and offering them to customers, identifying the key elements that make customers loyal, and improving the key factors that contribute to customer loyalty would address the issue.
Designing effective campaigns that appeal best to the customers, and reduce the costs to the marketer is an activity that requires a complete understanding of the target customer. Anticipating the changes in products/services that customers would demand requires continuous feedback . from the customer and its analysis. Another key challenge for relationship marketing is integrating the existing systems and human resources with changing technology applications, which are dynamic in nature. Maintaining an integrated view of the customer, across all the customer touch-points requires a robust information backbone, and sharing of information across the touchpoints.
Another key task involved in relationship marketing is the identification of the customers who account for a major chunk of business with the organization. These customers become high value customers for the organization. Once these customers are identified, they should be treated in such a way that their accounts are not lost.
Delivery of personalized services/ products to the most valuable customers becomes another critical factor, as it depends on the extent to which the organizations can personalize the products. Making available the current and updated data across all the front-end and back-end systems is critical for the success of any relationship marketing program.
Benefits of Relationship Marketing:
Relationship marketing helps in:
- Building customer loyalty and commitment.
- Offering personalized services and products, based on customer group preferences.
- Reducing the burden of excessive customer acquisition costs.
- Enhancing marketing effectiveness by carefully selecting customers t r various programs.’
- Developing better communication channels
- Collecting vital data, like customer details and order histories.
- Creating detailed profiles such as customer preferences.
- Delivering instant, company-wide access to customer histories.
- Identifying new selling opportunities. ,
- Providing more avenues for customers to communicate and explain their needs to the organization through numerous contact points.
- Increasing satisfaction among the customers
- Making customers feel important because of the increased personalization of services and customization of goods offered to them.
- Increasing the percentage of cross-selling.
- Attracting new customers and closing deals faster, through quicker and more efficient responses to customer leads and customer information
- Simplifying the marketing and sales processes by better understanding customer needs.
- Offering better customer service – through improved responsiveness and understanding that builds customer loyalty and decreases customer turn over.
- Identifying the best revenue opportunities for the organization
- Improving the revenue through acquisition of new customers, retaining existing customers, and increased share of the customer through up-selling, cross-selling, etc.
Article Collected From:
- Krishna, R. B. (2013). A study of customer relationship management in select public and private sector companies.