CHAPTER 2

CUSTOMER RELATIONSHIP:
CUSTOMER SERVICE

Lesson 1:
Relationship Marketing
 RELATIONSHIP MARKETING

According to Serrano, Relationship Marketing includes activities

aimed at developing and managing trusting and long-term
relationships with larger customers. (Customer profile, buying
patterns and history of contacts are kept in a sales database)

Relationship marketing is a strategy designed for customer loyalty,

interaction, and long-term engagement to be fostered. Customer
Relationship focuses more on long-term customer retention than
acquiring large numbers of new and potentially single-transaction
customers.
 Relationship Marketing is designed to develop strong
connections with customers by providing them with information
directly suited to their needs and interests by promoting open
communication.

Characteristics of Relationship Marketing:

1.It focuses on the long-term rather than the short-term.

2.It focuses on partners and customers rather than on the
company’s products.
3. It puts more emphasis on customer retention and growth than
on customer acquisition.
4.It relies on cross-functional teams rather than on departmental-
level work.
5.It relies more on listening and learning than on talking.
Relationship marketing calls
for new practices within the
4p’s.
THIS IS A SLIDE t i t l e

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items
▹BA untd remember
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with content

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content, but won’t do both.
▹ M o r e products are customized to the
customers’ preferences.
▹ N e w products are developed and designed
cooperatively with suppliers and distributors.
 PRIC
E
▹ T h e company will set a price based on the
relationship with the customer and the bundle of
features and services ordered by the customer.
▹ I n business-to-business marketing, there is more
negotiation because products are often designed
for each customer.
 PLAC
E
▹ R M favors more direct marketing to the customer,
thus reducing the role of middlemen.
▹ R M favors offering alternatives to customers to
choose the way they want to order, pay for, receive,
install, and even repair the product.
 PROMOTION
▹ R M favors more individual communication and
dialogue with customers.
▹ R M favors more integrated marketing
communications to deliver the same promise and
image to the customer.
▹ R M sets up extranets with large customers to
facilitate information exchange, joint planning,
BENEFITS OF RELATIONSHIP
MARKETING

In the business world,

retaining customers has a
lesser cost at least eight
times compared to acquiring
new ones. Thus, this
marketing capitalizes on the
same fact and is beneficial
to the company in several
ways.
.
 BENEFITS OF RELATIONSHIP
MARKETING
1. Understanding
customer
characteristics
the company can segregate its
customers into groups based on
their characteristics like
purchasing power, frequency and
volume of sale transactions. It
also helps the company get
valuable feedback from its
customers and understand their
needs and expectations.
2. Delivery and
meeting
expectations
if the company knows what its
customers’ needs are, it will
help reduce wastage due to
trial and error methods. It is
easier to create a product if the
features and specifications of
the product are known.
 BENEFITS OF RELATIONSHIP
MARKETING

3. Repeat 4. Prevents negative 5. Word-of-

Business transition mouth
Sellers should marketing
maintain good trust and loyalty go a happy customer
attitude to the hand in hand and it is will always
buyers. By doing super beneficial for promote business
this, buyers will all business. It will by telling ten other
feel that they do help prevent people about the
not need to customers from amazing services
switch sellers. turning to or performance
competitors. received from a
company.
 BENEFITS OF RELATIONSHIP
MARKETING
6. Increasing customer base
satisfied existing customer is 100%
more likely to recommend a
product/service to a prospective
customer. Apart from customer,
referrals, there are several other
ways to increase customer
satisfaction by employing
methods of utilizing social
networking websites, blogs,
informal surveys, benefits on
loyalty cards, timely response to
complaints and requests as a
constant reminder of its presence
around and retention equity is
improved by enhancing customer
7. Reduced marketing cost
Benefits also include lesser
marketing costs and more value
creation. This can be explained
by stating the following
statistics: every 5% increase in
customer retention can increase
a company’s annual profits from
at least 25% to as much as 125%,
while simultaneously leading to
a reduction of 10% in marketing
costs. An existing customer will
spend 33% more than a new
customer to buy a company’s
product/service.
 BENEFITS OF RELATIONSHIP
MARKETING

8. Minimization 9. Identification with 10. Product

of customer the company Market
price Expansion
sensitivity the benefits are reaped the company’s
a happy customer both by the company and employees must
will be willing to the customers. It helps be ready to deliver
pay more for a customers identify more beyond the
product if there is with the company. Keeping company’s
a guaranteed your communication lines boundaries on
satisfaction of open and keeping in customer demand.
products and after touch with the customers
sales services makes them feel like they
attached to the are being valued. It will
price. keep customers coming
. in and build brand equity
for the company in the
long run.
▹Examples of companies
using relationship marketing
▹Ikea
▹Direct recruitment
▹American airlines
▹Dell
▹Vyvanse
CHAPTER 2
CUSTOMER RELATIONSHIP:
CUSTOMER SERVICE

Lesson 2:
Customer Value
 CUSTOMER VALUE

Customer Value is the relationship

between benefits and the costs including
money, stress, and time to sacrifice that is
necessary to get those benefits.

Or simply stated in a mathematical equation:

Benefits – Cost = Customer Value
CUSTOMER VALUE
 In essence, customer value entails extraordinary delivery of
four
value-points or components known also as
SQIP:

SERVICE the intangible value offered to

 In essence, customer value entails extraordinary delivery of
four
value-points or components known also as
SQIP:

QUALITY customer’s perception of how well a

company’s products and services meet
 In essence, customer value entails extraordinary delivery of
four
value-points or components known also as SQIP:

IMAGE customers’ perception of the company or

business
 In essence, customer value entails extraordinary delivery of
four
value-points or components known also as
SQIP:

PRICE the price a company can command for its products

and services that its customers are able and willing to
DELIVERIN
G
1. Provide consumer
CUSTOMER
with the best cost.
VALUE
2. Provide the
Three ways a consumer with the
company best product.
can
establish 3. Provide the
customer consumer with the
value to its best service.
customer
base:
 Importance of Customer
Value

1. Designing and 2. Value reigns 3. Customers will not

providing superior supreme in pay more than a
customer value are the today’s product is worth and
keys to successful marketplace and will reward
business strategy in market-space. excellence.
the 21st century.

4. A customer-centric 5. Designing and 6. Providing

culture provides focus delivering superior outstanding customer
and direction for the customer value value has become a
organization, ensuring propels organizations mandate for
that exceptional to market leadership management.
value will be offered positions in today’s
to customers. highly competitive
global markets –
absolute advantage
Importance of Customer
Value

7. In choice-filled 8. Managing customer

arenas, the balance of value is even more
power has shifted critical to organizations
from companies to in the new service
value- seeking and information-
customers. based economy

10. Today’s customers are quite

9. Firms not providing smart and sophisticated and
adequate value to are looking for companies
customers will that::
struggle or disappear
– customer value is a a.Create maximum value for them
key ingredient in based on their needs and wants,
building competitive and
advantage. b.Demonstrate that they value
their business.
 thanks!
CREATING MORE CUSTOMER VALUE?
▹Understand what drives value for customers
▹Understand value proposition
▹Identify the customers and segments where
the company can create more value relative to
competitors
▹Create a win-win price
▹ F o c u s investments on the most
valuable customers
CHAPTER 2
CUSTOMER RELATIONSHIP:
CUSTOMER SERVICE

Lesson 3:
Customer Relationship
Development
 Benefits of Developing Customer
Relationship
Customer Relationship is a
marketing approach that focuses on
creating an ongoing and long-term
relationship with customers.
Benefits in developing and
implementing customer relationship

1. Consistent customer
experience

Customer Lifecycle
Journey
Benefits in developing and
implementing customer relationship

2.Customer
feedback
Benefits in developing and
implementing customer relationship

3.Customer
Profitability
Benefits in developing and
implementing customer relationship

4.Customer advocate
 Benefits in developing and
implementing customer relationship
5.
Innovation
 Benefits in developing and
implementing customer relationship

1. Consistent customer
experience
2. Customer Feedback
3. Customer Profitability
4. Customer advocate
5. Innovation
 Strategies in Developing Customer
Relationship
1. Make every customer interaction
count
 Strategies in Developing Customer
Relationship
2. Follow-through on commitments and
claims about products or services.
 Strategies in Developing Customer
Relationship
3. Develop
Employees.
 Strategies in Developing Customer
Relationship
4. Offer benefits and product value that
responds to the customer’s desires.
 Strategies in Developing Customer
Relationship
5. Treat customers as individual who are
respected and valued.
 Strategies in Developing Customer
Relationship
6. Listen to
customer.
 Strategies in Developing Customer
Relationship
7. Build a strong brand
identity.
 Strategies in Developing Customer
Relationship
8. Surround customers with valuable information by using emails,
websites, content, social media, and other methods of outreach but
do not be invasive.
 Strategies in Developing Customer
Relationship
9. The business must have a
website.
 Strategies in Developing Customer
Relationship
10. Reward loyal
customers.
 Strategies in Developing Customer
Relationship
11. Nothing strengthens a bond more
that appreciation.
 Strategies in Developing Customer
Relationship
12. Create a blog about the business where
discuss is more casual and inviting.
 Benefits in developing and
implementing customer relationship

1.Make every customer interaction count

2.Follow-through on commitments and
claims about products or services.
3. Develop Employees.
4.Offer benefits and product value that
responds to the customer’s desires.
5. Treat customers as individual who
are respected and valued.
6. Listen to customer.
 Benefits in developing and
implementing customer relationship

7.Build a strong brand identity.

8.Surround customers with valuable
information by using emails, websites,
content, social media, and other methods of
outreach but do not be invasive.
9. The business must have a website.
10. Reward loyal customers.
11.Nothing strengthens a bond more that
appreciation.
12.Create a blog about the business where
discuss is more casual and inviting.
CHAPTER 2
CUSTOMER RELATIONSHIP:
CUSTOMER SERVICE

Lesson 4: Customer Service

Strategy in the Philippine
Business Enterprise
Customer Service
Strategy
 Customer Service
Strategy
CUSTOMER SERVICE is the act of taking care
of the customer’s needs by providing and
delivering professional, helpful, high quality
service and assistance before, during, and after
the customer’s requirements are met.
Elements of the Customer Service
strategy:
1. A vision for customer
service
Elements of the Customer Service
strategy:
2. Assessing customer
needs
Elements of the Customer Service
strategy:
3. Hiring for
Service
Elements of the Customer Service
strategy:
4. Organizational goals for customer
service
Elements of the Customer Service
strategy:

5. Customer Service
Training
Elements of the Customer Service
strategy:

6. Employee
Accountability
Elements of the Customer Service
strategy:

7. Rewarding Good
Service
THE SUKI SYSTEM IN THE
PHILIPPINES
 Benefits in developing and
implementing customer relationship

SUKI SYSTEM system of

patronage in which a customer
regularly buys their
merchandise from a certain
client.
THE SUKI SYSTEM IN THE
PHILIPPINES
 Benefits in developing and
implementing customer relationship

SUKI – a partner system of doing

business in the Philippines, wherein a
customer buys certain products from a
particular vendor, who in turn offers
discounts and other perks for such
exclusivity. Filipinos use the word suki to
refer to both buyers and sellers,
indicating their equal roles and
obligations in an eponymous
relationship.
Thanks!