Friday, October 9, 2020

Identify and discuss the advantages and disadvantages of relationship marketing for the consumer.

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Relationship marketing involves the building and maintenance of a provider/consumer relationship. It not only involves the attraction of the consumer but also the ongoing and possibly lasting relationship that can develop. Relationship marketing focuses very much on the long-term, long-term value for the consumer, long-term satisfaction for the consumer and subsequent long-term loyalty by the consumer.


In relationship marketing one of the key fundamentals is the acknowledgement that the consumer is not passive but is very much active in the relationship. Both the provider and the consumer can and should benefit from a positive relationship. One of the advantages of relationship marketing for the consumer is that there is often a high degree of customer contact and customer service when a long-term relationship is trying to be established, this can add up to an increase of satisfaction experienced by the customer. Companies and organisations know that customers are more and more inclined to want and expect more and better service, support and satisfaction.


The customer may feel involved or attached to the company from which they are purchasing a product or service. The customer can also benefit from the increased or more accessible communications channels opened up by the company to aid in the relationship building process. There is, as always, and alternative view on these benefits to the consumer. Relationship marketing could be seen as a disadvantage, a way for companies to get a 'firmer grip' on their customers, to trap them and chain them into a relationship. This could be done through a series of 'smart tricks', contractual arrangements or other conditions only visible 'through a microscope in small print at the bottom the page', tactics commonly applied by mortgage providers who charge huge penalties to its borrowers who wish to change their provider.


One area in which relationship marketing may be judged as an advantage or a disadvantage concerns the notion of increased commitment, the consumer may enjoy and benefit from the encouragement of commitment knowing that their supplier or service provider is unlikely to suddenly 'dump' them in a time of need. The consumer may not see however the notion of increased commitment as an advantage if the relationship turns out to be dysfunctional. The very nature of commitment means it could be difficult for either party to leave the relationship if they are not content. Particularly for the consumer commitment can be more damaging than to the company. Finance firms and credit card operators are just two examples of providers which when faced with a difficult and dysfunctional relationship can terminate it or legally force the customer to comply with their terms and conditions as to limit the detrimental effects of the 'bad' relationship.


A distinct disadvantage to the consumer of relationship marketing is that companies may overlook the fact that not all consumers are equal therefore systems designed to progress and manage relations with consumers fail to discriminate between different consumer needs. Therefore too much emphasis is placed on building long-term relationships for profitable gain without consumer satisfaction being the prime concern of the company.


Relationship marketing can provide invaluable benefits for both the company/organisation as well as the consumer. The exact benefits of relationship marketing to the consumers can depend on who they are and who they are in a 'relationship' with, if the provider doesn't deliver adequate satisfaction in any way and the relationship becomes dysfunctional the benefits are obviously not great. However if the conditions of the relationship are adequate to both parties then it can be equally beneficial, customers receive higher levels of service and quality and the company receives loyal an profitable long-term customers.


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