The Theory of Relationship Marketing - Case Study Example

A critical analysis of biohacking marketing approaches Demand is determined, according to marketing theorists, as the needs and wants of consumer segments (Brownlie and Saren 1992). It has been proposed in the case study involving biohacking that the “friend” is seeking to target a wealthy 20-30 year old female market segment utilising a chain of tattooing organisations as an appropriate channel. There does not appear to be ample evidence for this marketing strategy that identifies the demand patterns for this particular market segment, thus it would make targeting the wealthy 20-30 year old segment quite difficult. For instance, the case study illustrates that there are only thousands of people worldwide that have sought these biohacking magnetic implants. Thus, there is an indication that it could be problematic to gain considerable demand. This is not advantageous for the marketing entity in the provided case study. It might be more advantageous for the friend in the case study to, first, consider a more mass market strategy in order to gain the attention of consumers that would appreciate these magnetic implants. The provided case study is limiting the marketer to a niche market which could also limit profit success. However, there is some possibility that utilising a tattoo chain as the chosen marketing intermediary could have some degree of success. For example, a recent study showed that consumers in their 20s, today, are happy with life and seek to explore having fun and tend to be attracted toward a variety of premium products which seek to build social identity (Executive Digest 2008). It is rather commonly understood, from a marketing perspective, that tattooing is often an outward expression of self identity and uniqueness from a social perspective. Thus, theoretically, this would be an ideal channel for marketing and sales focus by providing unique products to a younger market that is seeking adventure and the desire to explore fun. The case study provided evidence that magnetic implants could, in theory, create a new type of emotional experience by allowing the consumer that accepts these implants to be different from others in society or in their own age group. Why is this important in supporting the plans for the “friend” in selecting the tattooing chain as the appropriate marketing solution? Marketing and social sciences teach businesspersons that individuals in society often make what is referred to as social comparisons, the process of viewing others in the social environment and identifying how one might be superior to others (Suls, Martin and Wheeler 2002). People in society, as a rather homogenous whole, want to believe that they are superior to those through which social comparisons occur. A person’s total well-being, according to theory, is greatly enhanced when one believes they have this superiority over others in society (Taylor and Brown 1988). Magnetic implants, which would theoretically provide opportunities to sense electromagnetic fields or even pick up metal objects utilising only their skin (via assistance from the implant) is currently something that is not common in society. Hence, it would give the individual who receives the implant the ability to enhance their personal and emotional well-being as they would have opportunities to constantly make positive social comparisons and feel superior to others. With this in mind, the marketing entity in the provided case study is selecting tattoo chains as a proper marketing channel as this environment already provides said uniqueness that often services a need to show others in the social environment that they are different and helps to confirm and affirm self-identity. Morgan and Hunt (1994) further emphasise that relationship marketing is a strategy that can enhance the viability of a brand as it provides loyalty and often leads to positive word of mouth. Tattoo chains not only have to provide quality art products (as such art is permanent and a part of the individual throughout a lifetime), but these channels also provide consumers with more intimate relationships simply through the service dimension of tattoo delivery. Essentially, there is a psychology to tattoo artistry that tends to demand such relationships be developed during the service experience. Individuals that receive tattoos want an element of exclusivity in their final product that makes them stand out from others in society. The tattoo chains, therefore, provide excellent long-term opportunities for building relationships with the identified consumer segment (the wealthy younger markets) that would not require considerable cost and labour investment from the friend identified in the case study. The “friend” would be able to rely on the talents and perhaps even existing psychological prowess of the tattoo artist to establish the necessary relationships needed to gain loyalty and also spread word of mouth about the brand that could bring more long-term business and profit. Therefore, it should be commended that the case study’s marketing entity likely recognises that relationship development will be critical to gaining long-term profitability and satisfying the needs of the target market in the study. The case study also provides information that the magnetic implants are expected to be priced lower (competitively) in order to gain more consumer commitment to making a final purchase. This strategy, however, appears to be flawed for two reasons. According to Hansen and Solgaard (2004) consumers are more willing to pay a higher price when they consider that a product is heterogeneous. According to definition, heterogeneity in product brands is associated with uniqueness and that the product maintains characteristics that make them stand out from other products (or like products) in any particular sales market. When the product is considered homogenous (or standardised), there is more likely going to be price competition and less willingness by consumer markets to pay a higher price for the products. Fortunately, in the provided case study, the magnetic implants are so highly unique and non-standardised. However, the marketing “friend” is missing opportunities to capitalise on this phenomenon of consumer segments. The marketing entity already desires to target the wealthy consumer who maintains the higher resource availability needed to buy higher priced (premium) products. Since there are only thousands of individuals across the whole world with these implants, the marketing friend in the case study should be seeking more premium-oriented pricing strategies. There is little competition in this industry associated with magnetic implants (hence less risk of price competition). It is not of practical long-term value that the marketing entity should be targeting wealthy consumers who, according to Executive Digest (2008) want unique and premium products. The marketing friend should be re-examining a more dynamic pricing strategy that would provide better short-term profitability based on social factors as well as the phenomenon of product heterogeneity and its link to marketing success in pricing premiumisation that is already known to the marketing community to be viable based on consumer characteristics and behaviours. Outside of pricing, there is yet another reason why some of the marketer’s success strategies are flawed. Kotler and Keller (2007) provides knowledge about the intangibility of products, which is loosely defined as services that cannot be immediately seen, heard or felt prior to making a final purchase decision. The authors use an example of consumers that seek a face lift medical procedure as being somewhat unsure of the final result and therefore cannot immediately know for certain if the service procedure will meet with their expectations. The magnetic implant scenario is really no different. Bains, Fill and Page (2010) again illustrate that because of this uncertainty, consumers are often looking for physical evidence of the product or service prior to making a purchase that will assist in establishing brand trust and reduce uncertainty. Because of this, the marketing entity in the study should be seeking opportunities (or training of tattoo artists) that can provide the appropriate physical evidence that reduces hesitation or insecurity so that consumers are more willing to embrace the magnetic implants. The case study shows a form of informality in the method by which the marketing entity wants to essentially test market the sale of these products. Because uncertainty and vagueness in products and services that are unique, such as the proposed magnetic implant brand, can greatly impact purchase decision-making, it is recommended that the “friend” seek opportunities to provide physical evidence (as part of the seven Ps of marketing), so that confidence in the brand and its long-term benefits can be understood. Though this might impose a few additional costs to the marketing strategy currently selected by the marketing entity, it would be worth the investment when profitability is generated at a faster pace and consumers can actually trust in the brand integrity of this particular biohacking product. Aaker (1996) further provides knowledge that in order to be successful in a market environment, a brand needs to have a brand personality. Brand personality shows consumers that a product brand is sincere, exciting, competent and sophisticated (Aaker 1996). These factors, according to theory, are vital to establishing relationships between consumer and brand and also ensuring adequate sales. The case study did not indicate that the marketing entity would be seeking a branding strategy, instead simply seeking an appropriate distribution channel and then essentially standing back and waiting to see if the sales strategies are successful and demand is increased. The current chosen strategy is not providing opportunities to build a brand and establish a personality which could limit the success potential of the venture. If there is likelihood that other competition will eventually be attempting to compete in marketing magnetic implantation, it would be a quality strategy for the “friend” to identify any and all opportunities to build a brand reputation and personality that would make the business stand out appropriately among competitors. It is therefore recommended that the marketing entity in the case study seek knowledge of contemporary branding strategies in order to build stronger relationships with consumers, establish credibility, and also gain a reputation over potential competition as a proactive marketing approach. Finally, to the credit of the marketer, it would appear that the friend understands that segmentation costs often incur high costs to the marketer (Dibb 1998). This is because segmentation often requires advanced knowledge (oftentimes through using quantitative research studies) of consumer behaviour attitudes. The marketer in this case study is choosing an appropriate strategy to simply select the wealthy 20-30 year old markets rather than investing high capital investment into identifying the complex behaviours of segmented markets. This venture does not provide significant evidence that magnetic implantation will be immediately profitable and in high demand. It might be cost burdensome to attempt to segment, especially when using psychological and emotional variables associated with consumer segments, which could halt the venture from being profitable before it is even gotten off the proverbial ground. It would appear that the friend in the case study should, as is part of the current strategy, seek opportunities to limit costs and simply seek a wealthier market with ample resources needed to purchase magnetic implants. As simply a cost factor, the marketer in the case study should be commended for removing risks associated with advanced segmentation strategies and simply make logical inferences about the likelihood of wealthy 20-30 year old markets as a potential viable market opportunity. All things considered from the case study, the friend who will be marketing these products has many factors that could lead to success whilst also needing adjustments to strategy in order to maximise total effectiveness of the current marketing strategy. By seeking opportunities to build relationships, create some form of viable physical evidence, recognising the emotional, social and psychological characteristics of many potential markets, and seeking more dynamic pricing strategies, it is likely the friend will meet with long-term profit success. The recommended modifications will avoid potential failure and also provide consumers with the confidence and security in the new magnetic implantation brand necessary to achieve market and sales/profit successes in the proposed venture. As identified, it is not contingent on the viability of the distribution channel and the tattooing service provider, but also in the development of an appropriate short and long-term strategy that could yield better and more efficient results in the new marketing strategy. References Aaker, D.A. (1996). Measuring brand equity across products and markets, California Management Review, 38, pp.102-119. Baines, P., Fill, C. and Page, K. (2010). Marketing. Oxford: Oxford University Press. Brownlie, D. and Saren, M. (1992). The four Ps of the marketing concept: prescriptive, permanent and problematical, The European Journal of Marketing, 26(4), pp.34-37. Dibb, S. (1998). Market segmentation: strategies for success, Marketing Intelligence and Planning, 16(7), pp.394-406. Executive Digest. (2008). How to market to the overlooked 25-34 year old age segments. [online] Available at:http://www.marketing-execs.com/news/11-08/2.asp (accessed 27 October 2013). Kotler, P. and Keller, L. (2007). A framework for marketing management. Pearson Prentice Hall. Hansen, T. and Solgaard, H.S. (2004). Strategic pricing: fundamental considerations and future perspectives, The Marketing Review, 4, pp.99-111. Morgan, R. and Hunt, S. (1994). The commitment-trust: the theory of relationship marketing, Journal of Marketing, 58(July), pp.20-38. Suls, J., Martin, R. and Wheeler, L. (2002). Social comparison: why, with whom, and with what effect?: Current Directions in Psychological Science, 11(5), pp.159-162. Taylor, S. and Brown, J.D. (1988). Illusion and well-being: a social psychological perspective on mental health, Psychological Bulletin, 103(2), pp.193-210. Read More