Winning customers for life with relationship marketing - Essay Example

?Week Two Summary Week two was a very challenging week that taught me a lot. I am a member of team B. Our first project together involved creating a new product. The team interaction was very effective. Everyone gave their input about potential ideas to work. We eliminated the options that were harder to implement. The solution we choose was based on consensus. Our idea ended up being introducing a line of frozen food products for customer to enjoy out of the comfort of their home. The week two classroom interaction was very informative. The professor posted numerous articles for the students to read. The selection of articles chosen by our professor was excellent. It is more interesting to read journal articles than to read textbook material. The textbook provides the theory, but articles provide the application of the concept. This helps student better visualize the usefulness of marketing in the real world. I liked lot the Principles of Marketing article. The authors provide a great discussion about basic marketing ideas that are very useful for marketers. The FOCVS acronym is a great new marketing concept that can be used by companies to improve the effectiveness of their marketing department. Article Review The article Winning Customers for Life with Relationship Marketing was quite interesting me due to the fact that relationship marketing is a technique that can increase the sales figures of a company. Many companies are able to generate first time sales, but retaining customers is the key to having a successful business model. It is said that 80% of your sales are generated by 20% of your customers. Finding and retaining good customers can help companies build a business that can succeed in the long run. The use of a relationship marketing plan can help companies identify customers that are valuable to the firm. When a firm can identify its best customers companies can create targeted marketing campaigns. An interesting finding from the article was the fact that marketing has become processized. Using technology can help marketers analyze information better which can help firms achieve greater results. Marketing automation can be used in order to analyze data faster and to obtain update data and information. This can help companies make better operating and strategic decisions. The ten steps require for executing relationship marketing automation are: build your database, segment your list, design your communication, build your microsite, include a survey, schedule and send your campaign, follow-up on leads, nurture prospects, analyze campaign results, and repeat the process (Vtrenz, 2007). Chapter Five Summary The purpose of marketing is to is to satisfy the customers’ needs better than the competition. Companies that are able to serve the needs of the customers are the ones that are achieve greater market penetration and a higher level of success. Customer behavior can be defined as the study of how individuals, groups, and organizations select, buy, sell, and dispose of goods, services, ideas, or experiences to satisfy their needs and desire. Customer behavior is influenced by a variety of factors. Both marketing and environmental stimuli enter into the buyer’s consciousness. Cultural factors are very influential in customer’s decisions. Culture is considered the fundamental determinant of a person’s wants and behavior. Cultures are composed of different subcultures that provide specific identification and socialization for their members. There are different social classes within the different societies across the world. They are relative homogenous and enduring divisions in society. There are seven ascending levels of social classes. The seven levels are: 1) lower lowers; 2) upper lowers; 3) working class; 4) middle class; 5) upper middles; 6) lower uppers; 7) upper uppers. People from the same social class tend to behave similarly then people from different social classes. Some of the things that differentiate social classes are dress, speech patterns, and recreational preferences. Social factors also affect buyers’ decisions. Some social factors include family, reference groups, and social roles. Reference groups refer to groups that have a direct or indirect influence on a persons’ attitude or behavior. Examples of primary groups include family, friends, co-workers and neighbors. The family nucleus is the most important social group in our society. Independent of the country in which the person lives in the family concept is engrained in every society. Children seek the approval of their parents in regards to the purchasing decision that they make. In the United States the makeup of the family has changed over the years. In the 1950’s 80% of the American households were composed of married couples and their offspring. Today less than 50% of the households are composed of single parents or single people. Marketers are interested in the roles and relative influence of family members in the purchase of a large variety of offerings. People participate in many groups. The person’s position in each group can be defined in terms of roles and status. Another metric that affects the buying decisions of people is personal characteristics. Some key personal characteristics are age, occupation, personal circumstances, personality, lifestyle, and self-concept. People buy different goods and services during a lifetime. For example children are interested in toys, while senior citizens purchase a lot of vacation packages to enjoy their retirement. The occupation and economic circumstances of the person affects a lot in the purchasing decision. For example blue collar workers purchase regular clothes to go to work, while managers and executives used formal dresses to go to work. People with more money buy new luxury cars and SUVs, while poor people are lucky in they can afford a used car. The personality of a person affects their purchasing decisions. Four key psychological processes are motivation, perception, learning, and memory. A motive is a need that is sufficient pressing to drive a person’s act. For example a person might get motivated to purchases a particular brand of watch. This person will save up money until that purchase of the watch is made. Perception is the process by which an individual selects, organizes, and interprets informational input to create a meaningful picture of the world. Learning involves changes in an individual’s behavior that arise from experience. Memory encoding refers to how and where information gets into memory. Memory retrieval refers to how information gets out of the memory. A five stage buying decision model that can be used by customers to make buying decisions is: problem recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior. The buying process starts when the buyer recognizes a problem or need, triggered by internal stimuli or external stimuli. Information search occurs because buyers want to be informed prior to making a purchasing decision. A lot of buyers are using the internet to make information search about products or services. The evaluation of alternatives is important to determine the benefits and cons of the different alternative solutions identified by the buyer. In the purchase decision stage the buyer forms preferences among brands. In the final stage the buyer forms an opinion about his purchased based on the customer’s expectation and the actual performance of the purchase. Satisfaction or dissatisfaction in the purchase will determine whether or not the buyer purchases the product again. When customers are satisfy with a purchase they will continue to buy the product. If this occurs the company will obtain customer retention which is a desirable outcome because it leads to customer retention. Dissatisfied customers may abandon or return the product. Marketers can use post-purchase communication to reduce product returns and order cancelations. The use of marketing strategies can be used to gain customer that stop purchasing a firm’s products or services. References Vtrenz (2007). Winning Customers for Life with Relationship Marketing. Read More