SERVICES AND RELATIONSHIP MARKETING

Services and Relationship Marketing

Services and Relationship Marketing

Introduction

All services are experiences some are long in duration and some are short; some are complex and others are simple; some are mundane, whereas others are exciting and unique. Service is an intangible spectrum provided by various service organizations. With more sophisticated customer, requiring greater focus on choice of service and changes in the marketing environment, banks have also been diversifying themselves in terms of their service. The difference between perception and expectation is a result of customer gap on which gaps model is reliant. The customer gap locates the problems in service problems but does not identify the cause of the problem. Service firms have to minimize or close the gap between the expectations and customers' perception of the received service if they want to build and sustain long term relationships (Wilson, Zeithaml, and Bitner, 2008, p 114).

Retaining loyal customer is more profitable than attracting new customers since more than 70% of sale come from loyal customers. A research shows that a 5 per cent increase in customer retention can increase the retail industry profit by 20- 100 per cent. Customer relationship management helps to maintain data relating to customers accounts, purchasing behaviour that can help to improve the contact with customers and retain these unsatisfied customers. Further study on Customer relationship management will help to understand the importance of CRM on improving the relationship between customer and retailers and overcoming with service failure problems. Retaining loyal customer is more profitable than attracting new customers since more than 70% of sale come from loyal customers. A research shows that a 5 per cent increase in customer retention can increase the retail industry profit by 20- 100 per cent. Customer relationship management helps to maintain data relating to customers accounts, purchasing behaviour that can help to improve the contact with customers and retain these unsatisfied customers. Further study on Customer relationship management will help to understand the importance of CRM on improving the relationship between customer and banks and overcoming with service failure problems (Turley, 2001, pp. 12).

Discussion Guide

For an organization, attracting new customers is important, but even more important is retaining the existing ones. According to the Pareto principle, 80 percent of sales that an organization makes come from 20 percent of its customers. Keeping this in mind, organizations employ customer loyalty programs (CLPs) to retain the existing or new customers, hence increasing market share, and consequently boosting returns. In general, CLPs aim to reward the customers for their loyalty and patronage. Segmenting the various markets your organization works with is crucial to helping you understand how to craft the marketing message across diverse groups. Taking another look at our earlier example of the church and its key customer segments, it is safe to say that it should not use the same marketing to appeal to youth as it would to senior citizens (Wilson, Zeithaml, and Bitner, 2008, p 110). What connects and resonates with one group may not appeal ...