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The Importance Of Relationship Marketing

Daniel Clayton - Marketing Consultant • Feb 16, 2021

It can be said that relationships with customers, employees, suppliers, distributors, dealers and retailers are of the greatest value for most if not all companies. A company`s relationship capital can be classified as the sum of the knowledge, experience and trust a company has with its customers, employees and suppliers. These relationships are often worth more than the physical assets of a company. This is so as relationships are what determine the future value of a company.


Such is the importance of relationship marketing that a slight slip in the aforementioned relationships will affect the company`s performance leaving them with much damage control to do. In order to prevent this, companies should therefore develop a relationship scorecard that describes the strengths, weaknesses, opportunities and threats in regard to the respective relationships. As such, the company in question will need to move quickly in repairing any important but weakening relationships.


Relationship Marketing recognizes the importance of various stakeholders namely; suppliers, employees, distributors and retailers and cooperating to deliver the best value to the target customers. In fact, what makes relationship marketing such an important feature of most modern day companies is that; it focuses on customers rather than on the company`s products, it puts more emphasis on customer retention and growth than on customer acquisition and it relies more on listening and learning than on talking. With that said companies should therefore shift their focus towards achieving mutual interdependence and think less of competitors if they want to reach their optimum potential.


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By Daniel Clayton, Marketing Consulant 06 Oct, 2021
All companies have competitors. Even if there were only one Taxi Company, the company would have to worry about buses, cars, bicycles, and even people who might prefer to walk to their destinations. The late Roberto Goizueta, CEO of Coca-Cola, recognized the company`s competitors when his employees were of the perception that Coca-Cola`s market share was at a maximum. In responding to his employees, the then CEO went on to state that Coca-Cola accounted for less than 2 ounces of the 64 ounces of fluid that each of the world’s 4.4 billion people drank every day. “The enemy is coffee, milk, tea, water,” he told his people. As a result, Coca-Cola is now a major seller of bottled water. The more success a company has the more competition it will attract. Most markets are brimming with whales, sharks, and minnows. In these waters, the choice is to eat lunch or be lunch. Or, using computer scientist Gregory Rawlins’ metaphor: “If you’re not a part of the steamroller, you’re a part of the road.” Hopefully your company will attract only good competitors as they are considered to be a blessing. Good competitors are like good teachers who raise our sights and sharpen our skills whilst Average competitors are a nuisance with Bad competitors being a pain to every decent competitor. According to marketing guru Theodore Levitt: “T he new competition is not between what companies produce in their factories, but between what they add to their factory output in the form of packaging, services, advertising, customer advice, financing, delivery arrangements, warehousing, and other things that people value .” The best way to beat your competitors is to attack yourself first by working hard to make your product line obsolete before your competitors do. Companies in an effort to gain a substantial share of the market should pay keen attention to their distant competitors as well as their close competitors. This is of great significance as the most dangerous competitors are oftentimes those that resemble the company the most. Therefore, it is important that companies differentiate their product and service offerings as most markets are plagued by too many fishermen going after too few fish. The fishermen who understand the fish better than their competitors do will eventually win in the marketplace.
By Daniel Clayton - Marketing Consultant 25 Sep, 2021
Many years ago, Michael Porter stated that “a company wins by building a relevant and sustainable competitive advantage.” With that notion in mind, it can therefore be said that having a competitive advantage is like having a gun in a knife fight. Whilst the aforementioned is true, it should be noted that most advantages in today’s hypercompetitive environment does not remain relevant and very few are sustainable. This is so as advantages are said to be temporary. What does this then means for companies who are seeking to achieve competitive advantages within their respective industries? A company does not win with a single advantage but by layering one advantage on top of another over time. Japanese companies such as Toyota Motor and Honda Motor have been masters of this. They first entered the Automotive Industry with low prices, then with better features, then with better quality and then with faster performance. This can be attributed to the fact that the Japanese have recognized that marketing is the only race which does not have a finishing line. Companies can create a competitive advantage from many sources, such as superiority in quality, speed, safety, service, design, and reliability, together with lower cost and lower price as advantages are achieved through a combination of the above-mentioned, rather than a single source. Therefore, in an effort to create and achieve sustainable competitive advantages, companies should seek to incorporate a set of characteristics that all reinforce each other around a basic idea.  By characteristics, we mean unique practices that will enable companies to charge the lowest prices in their respective industries. It should however be noted that any company that decides to focus on only a few as opposed to all the sources will not succeed in gaining a competitive advantage. This is so as competitive advantage is said to be relative and not absolute.
By Daniel Clayton - Marketing Consultant 18 Jul, 2021
 Many companies, in marketing their products and services tend to downplay the importance of Public Relations. This is based on the premise that they lack a basic understanding of what Public Relations is and the true impact it creates. Creating a new brand through Public Relations takes much more time and creativity; however it ultimately will do a better job than other elements of the Promotional Mix for which most companies tend to place much more emphasis on. Regardless of the industry, trust plays a significant role when it comes to determining the success of a company. Without trust, a company runs the risk of leaving potential sales on the table. Therefore, in order to prevent the aforementioned from occurring, it is important that companies invest in Public Relations as it increases Brand Credibility. By practicing proper Public Relations, it is highly likely that new potential customers will resonate with the brand as they will possess more options to connect with the company through the stories and press releases on behalf of the company. This therefore shows that Public Relations is not complete without marketing as it increases the company`s profits and sales. Most importantly, Public Relations enhance the online presence of companies. The fact that everyone is connected digitally in today`s world, companies are provided with the opportunity to create a strong presence online that is highly visible to their target audiences. With the use of social media increasing, customers are able to say whatever they want about a company which can in turn tarnish the reputation of the company. Public Relations is therefore important as it helps to market the company online whilst helping to shape and maintain its corporate image by intervening whenever a disaster occurs or something threatens to damage the image the company has been building.
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