For many years, the Marketing Mix and the 4 P’s model have been essential theoretical concepts when determining the strategy of a business. The Product, Price, Place and Promotion are useful tools to enhance the progression of a business brand image and encourage competitive advantage. (Jobber, 2007) However, in the fast paced business environment that society is facing today alongside with the digital revolution, marketing methods need to be revised and adapt towards the new Direct and Digital Marketing.
As a result, marketers started seeking for ways to engage the customer toward their product based on strong relationships with a perspective on the long-term preference for the business. The main purpose of these relationships, also known as Relationship Marketing, is to build a marketing network, that consists of the company and its’ shareholders: custоmers, emplоyees, suppliеrs, distributоrs, retаilers, аd аgencies etc. or anyone of mutual profitable interest. (Kotler, 2009)
In other words, Relationship Marketing (RM) aims to unite client relationships, customer loyalty and brand value intro a successful strategy through two key tools: web technology and focus on customer. Based on this the businesses have the opportunity to build gradually trust and loyalty and achieve repeat purchases on their products. It has been proven that the customers who have already used the services of a company, tend to spend 33% more than the new ones and it’s six times less expensive to sell them a product. Furthermore, the chance for a repeat customer to recommend the purchased product or service to another consumer is a 107% greater. (Lake, 2014)
As it can be seen, this strategy is easy to implement, with greater chances of achieving higher revenue at a low cost. Businesses future perspective is to deliver its values to the consumer, make them believe they are at the centre of the companies’ attention and they are willing to create a meaningful relationship with them. In order to do so, companies need to fully satisfy their consumers and here comes the role of the direct marketer. Direct Marketing provides tools such as social media and other online platforms, where the marketer can build up a profile for his customers and fully understand their needs and wants.
However, this shift toward relationship marketing doesn’t mean that the traditional methods (4 P’s) have to be neglected. Most companies operate with a mix of the two approaches. The ones that have a larger customer base are predisposed to adapt more of the traditional one, whereas the practice of smaller businesses is the RM. (MaRS, 2009)
Relationship Marketing and the 4 P’s
Adopted from Kotler, 2003.
Product – more products need to be modified according to the consumers’ needs and wants. When it comes to the new products, they need to be created in cooperation between suppliers and distributors.
Price – the set price has to be based on the relationship with the customer and should include the...