Relationship Marketing and Transactional Marketing

Relationship marketing strategy primarily focuses on building long-term relationships with the customer. There is a requirement of heavy investments and hard efforts for giving the customer a good experience. Transactional marketing focuses on point of sale transactions. It is quite opposite of relationship marketing. Transactional marketing focuses mainly on getting new sales. It does not put a lot of effort into creating a good customer experience. Transactional marketing helps in encouraging new products but does not focus on acquiring new customers, which is a major drawback. Transactional marketing is a traditional approach. A company must satisfy its customers with great services and products and must keep improving as per the need of the customer, but if a company fails to do so, then it can be said that the brand has failed to satisfy the customer’s needs.

Some companies use both transactional marketing as well as relationship marketing approach.

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Benefits and Challenges of Relationship Marketing:
Some of the key benefits of relationship marketing are listed below:

A long-term relationship with the customers: A long-term customer relationship directly proves the loyalty of the customer toward the company. If all the requirements and need of a customer are satisfied by the company, then these customers tend to stick with the same brand for a long period.

Increasing the customer base: When the customers are satisfied, the brand will have a positive response in the market. If the customer is pleased with a product or service, they will certainly recommend it to their family and friends and put a positive word regarding the brand. Eventually, this would contribute to the company’s sales and increase the customer base.

Customer retention: If there is a good relationship established between a company and a customer, then a small increase in the price of the product would not affect the need of the customer. Hence, a company can have fixed customers for a very long period if a proper and healthy relationship is built with the customers.

Competitive advantage: By giving customers appropriate services and by maintaining a healthy relationship with them, a company provides something better than the other companies. Due to this reason, customers will get attracted to one company which is providing better services than the companies which are not providing it. Hence, a company will get a better advantage than its rival companies, which will lead to great profits.

Challenges faced in relationship marketing are as follows:

It can prove to be expensive, as it will take some time to develop a proper relationship with a customer. Hence, this method is expensive and time-consuming.

Some customers can spread negative information, which will require some time for reversing those effects.

There can be a problem with new customers, as there is a chance that they might get ignored or they may get overlooked.

Relationship Marketing Strategies:
The strategies which can be implemented for establishing a good relationship with the client are mentioned below:

Focus on the customer: The main lookout should always be to know what the customer wants and how to deliver it. A proper and balanced focus should be given to the quality of products as well as the relationship with the customers should be maintained. It is important to listen to their concerns and needs to make better improvements in the quality of products, availability of products, and other necessary need of customers.

Staying connected with the customers: Nowadays, with the help of the internet, it is very easy to stay connected with customers. It is important to know the online platforms where the customers are spending more time. Communication and targeting should be made around those platforms ensuring the customer gets a timely update of any new launch or details regarding the company.

Customer loyalty programs: Companies conduct loyalty and referral programs to ensure customers come back and purchase again from them. These loyalty programs are very essential in building a relationship with customers. If a customer receives a reward in cash or in points, then the customer receives satisfaction and provides positive word of mouth to its friends and family members.

Collect customer feedback: It is important to know what the customer thinks about the products and services; therefore, feedback must be collected on time. Customers share their feedback on e-mail in the form of reviews and on social media in the form of comments by tagging the brand. Reviews and feedback help the company to understand if there are any changes needed or if the customer is completely happy with the product. It also gives them scope for improvement.

Addressing the concerns through a team of customer service: There must be the use of toll-free numbers, which should be provided to customers. Because of this toll-free number, a customer can clear his query regarding warranty issues, the problem with a product, etc. If these toll-free numbers are attended promptly and manned by people who have great communication skills, then it can enhance the satisfaction level of a customer. The customer service process should be smooth, making it easy for the customer to connect with the brand whenever needed. It is also necessary to address customer concerns timely.

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