The management of relationships


An organization has to maintain healthy and fruitful relationships with not just with customers but also with external and internal stakeholders. These relationships are intervened over various networks, association, and information management. Through this organization are able to create and maintain closer link with its market and consumers.

The traditional marketing practice is relevant in scenarios where a customer is much pricier driven rather than relationship driven. Also relationship marketing takes a back-seat customer acquisition is more in demand than customer retention.

Therefore, relationship marketing can be used as an extension of traditional marketing practice in the product life cycle.

Evaluation of Relationship Strategy

The focus of relationship marketing is to create long term loyal customer. However the focus of traditional marketing strategy is to bring in more customers. Though these two approaches may appear too different to each other, but in reality and application both go hand in hand. So organization uses a mix of traditional marketing strategy along with relationship marketing.

The first stage of any marketing planning cycle is the evaluation of the strategy. In evaluation it is important to find out whether the customer is interested in having any relationship with the organization.

The relationship would be beneficial to both parties if there were possibility of success. If customers do not find any value addition in the relationship they will not be ready to enter into one.

Another evaluation point is the time frame of product utility. If the product is use and throw kind then it would be less likely that consumers would like to have relationship with the company. On the other hand, if product usage over a longer period of time, probability of customer relationship is increased. In case of business to business transaction development of the relationship would be important.

While evaluating strategy, organization would like to know what sort of customer it is looking to target; whether the customer is active, low maintenance or high maintenance.

In the current global environment, market dynamics are constantly changing, so organizations need to evaluate the time taken for execution of strategy and time for it to yield results.


After evaluating the customers and their behaviors, the next in planning cycle is the product. Organizations need to take a closer look at the product or services they are selling and whether they are beneficial for relationship marketing.

The way the products are perceived in consumer mind and how they are able to differentiate against competition should determine need of relationship marketing. Products like car, bike etc. are appropriate product for conducting customer relationship initiatives. However, from commodity types of product like salt, flour customer relationship may not make that much sense.

Organization need to identify the current state of its product in the product life cycle to develop and determine relationship marketing strategies.

Relationship Options

After the evaluation of customer and product, the next step is looking at different alternates of relationship to forge with consumers. For that organization need to separate good or bad customer so that it can manage relationship which can generate maximum profits.

The organization needs to ascertain whether the consumer is deceitful, negligent, naysayer or makeshift. The next step in developing a portfolio relationships. By developing a portfolio of relationship, organizations can diversify risk through a mixture of high risk –low risk relationships. This can be done by getting into relationships which of different categories and at different stages. Economic consideration should also be considered in developing a portfolio of relationships.

There are several types of relationship into which organization can get into with the consumer.

  1. A close relationship is categorized by the high volume of business with a great deal of trust and commitment.

  2. In a re-current relationship business volume is low, but trust and commitment are high.

  3. In a dominant relationship trust and commitment are high but business volume is low.

  4. Similarly, in a discreet relationship everything is minimal.

In balancing relationship portfolio is important for an organization to do key account management. In key account management few dedicate resources, maintain close relationship with most profitable customers.

Structures and Process for Relationship Marketing

The organization is looking to implement relationship marketing need to develop the following:

  • Design and maintain process which is customer focused rather than product focused

  • Create a clean and clear communication about its objectives across the organization

  • Identify key process which adds value to customers

  • Form collaborative relationships across departments and with other organizations

  • Restructure and refining organization structure

Implementation, Monitor and Control

After following all the steps which are listed above, the organization is ready to implement relationship marketing strategy.

Organization need to make steady effort in monitoring and controlling its relationship marketing strategies. They need to develop metrics because if the organizations are not able to measure than they cannot manage.

Financial measurement of the relationship marketing is essential to maintain optimal balance of growth.

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