Effectiveness of Relationship Marketing and eCRM
Relationship marketing is a strategy designed to foster customer loyalty and long-term engagement. These marketing strategies are developed with strong connections to customer loyalty. The major implication of this type of marketing is that the customer only connects with the business when they get premium services.
Relationship marketing incorporates three levels such as basic marketing, reactive marketing, and proactive marketing. ECRM stands for electronic customer relationship marketing as per Felix, Rauschnabel & Hinsch (2017). ECRM provides an effective system for the interaction of two parties (customers and business employees) with the help of web-based technologies. Various benefits of eCRM are improved customer relations, a centralized database, and customer loyalty to name a few. This process helps an organization to create and manage the centralized database of their customers so that they effectively and efficiently focus on their customers.
In this study, research questions will be made with the hypothesis, and it will be followed by a literature review. In the end, the findings and discussion of the report will be made.
1. Research Questions
The purpose of this report is to analyze the degree of effectiveness of relationship marketing and eCRM. To analyze the facts, a secondary research method will be selected and reliable journals and/or web-based information will be incorporated.
- Is relationship marketing more cost-effective than direct-personal relationship marketing?
- When did the concept of relationship marketing originate?
- What role does social media play in enhancing the performance of relationship marketing?
- Why an organization focuses on relationship marketing instead of focusing on other forms of marketing?
2. Research Task
The research task will include a discussion about the measures through which an organization can build up an effective relationship with their customers. Apart from this, this research will also discuss the benefits from the perspective of an organization to maintain the eCRM rather than maintaining the direct-personal relationship marketing with the clients.
Business houses assign the eCRM with the utilization of technology to deliver a high-quality customer experience across all the channels such as via social media, video conferencing, via call, chat, and similar measures (Melancon & Dalakas, 2018). Furthermore, this research will focus on effective methods to increase the efficiency of the processes as well as to enhance the ability of the process.
A successful E-CRM framework tracks a client's history through numerous directs progressively, makes and keeps up a systematic database, and enhances a client's connection in the three parts of fascination, extension, and support. A run-of-the-mill E-CRM procedure includes gathering client data, exchange history, and item data, clickstream and substance data. It gives a value-based examination comprising of the client's profile and value-based history and an active investigation comprising of exploratory exercises demonstrating the client's route, shopping basket, shopping example and the sky is the limit from there (Melancon & Dalakas, 2018).
3. Hypothesis
Null hypothesis: There is no significant association between relationship marketing and organizational productivity in Australia.
Alternative hypothesis: There is an association between relationship marketing and organizational productivity in Australia.
In this study, the idea of both the null hypothesis and alternative hypothesis will be explained through the study of various literature. A hypothesis is different from the theory because the hypothesis is an assumption that is explained before commencing the study, but a theory is the set of principles that explains the phenomenon as per Hilborn and Mangel (1997). The reason behind choosing the null hypothesis and alternative hypothesis is that they explain an appropriate description of the phenomenon. The primary purpose of this study is to figure out the answers to the research questions that are mentioned above.
Apart from this, in a general sense, it is observed in the service sector that there is a strong connection between the applications of relationship marketing with organizational productivity. However, the below study will focus on the findings of the answers to all such relevant questions and general assumptions. In the end, the discussion part will conclude the summary of the research.
4. Literature Review
According to Sheth (2017), in the mid-1970s the fundamental factor for the rise of relationship marketing is the economic recession. The author has further explained that the reason behind saying this is that due to the economic recession people started withdrawing their money from banks, real estate, stock exchanges, etc. After that, people started searching for their own relationship manager to keep a personal track of their investments. People also started to appoint a person who can personally handle and allocate their funds. Thus, in this era, relationship marketing came to be. Initially, relationship marketing was needed to handle funds, and people who carried out this job were known as relationship managers.
After that, other organizations also started adopting the norms of relationship marketing because relationship marketing is a great way to encourage customers and creates bonds towards long-term relationships with them. In this era, relationship marketing is considered an effective way to gain market shares with inorganic growth such as mergers, acquisitions, and alliances (Sheth, 2017).
According to Zhang, Watson, Palmatier & Dant (2016), business houses engaged in relationship marketing to improve their ongoing rapport with other business partners, customers, and other stakeholders. However, there are set strategies of relationship marketing and those who desire to apply relationship marketing have to maintain its major implications. The author also mentioned in this literature that the organization should consider strategies against their internal and external environmental factors. These sets of strategies need to be modified as per ongoing conditions. Apart from this, it is also concluded in this literature that even with strong and great relationships, customers can migrate towards different relationships from time to time. In this literature, the author has applied the multivariate hidden Markov model to a six-year longitudinal data set of 553 business-to-business relationships (Zhang, Watson, Palmatier & Dant, 2016).
5. Findings
All together for a business to succeed, management has to give enthusiastic support to the client, both new and old. In this era of social media, business houses take advantage of influencer marketing. 55% of advertisers state blog content creation is their top inbound promoting need. WordPress clients produce over 70.5 million new blog entries and more than 52 million new remarks from month to month (Badwan, Al Shobaki, Naser & Amuna, 2017).
Advertisers who organize blogging endeavors are 13 times bound to see positive ROI. 51% of B2B advertisers organize making visual resources as a major aspect of their substance-promoting procedure. 72% of advertisers said that having a decent substance procedure was a significant key to their achievement in 2018 (Armstrong, Kotler, Harker & Brennan, 2018).
Apart from this, the reason behind the success of eCRM is that it is the cost reduction method from the perspective of the business houses. It can be said that a successful eCRM expands the effectiveness of the procedures just as it improves communications with clients and empowers organizations to modify items and administrations that meet the clients' individual needs. Electronic client relationship with the executives is spurred by simple Internet access through different stages and gadgets, for example, workstations, cell phones, work area PCs, and TV sets (Cardoso, Fleury, Feldmann & de Araújo, 2017). It is not programming, in any case, yet rather the usage of Web-based advances to connect, comprehend and guarantee consumer loyalty.
6. Discussion
In this report, the discussion is because relationship marketing is the way through which business houses can make better customer loyalty and long-term engagement. Furthermore, the benefits of eCRM are also discussed. From the perspective of both, business houses and customers, eCRM provides an effective method to maintain the relationship with clients. This method of relationship marketing is more cost-effective than direct personal relationship marketing. As eCRM is a cost-effective method, it helps the business houses to make a centralized database. This is the solution to implement relationship marketing with the application of technology in order to deliver effective solutions and a high-quality customer experience.
Furthermore, it is also concluded that influencer marketing is also a great way to uplink relationship marketing. While incorporating the norms of influencer marketing towards enhancing customer loyalty it becomes the duty of the marketing manager of the company to support and give attention to influencer marketing with the effective norms of relationship marketing. Moreover, the internet provides the ideal environment to encourage customers and build long-term loyalty with them.