Relationship marketing is defined as the identification, establishment, maintenance, enlargement, modification and termination of relationships with customers to form

value for customers and profit for organization by a series of relational exchanges that have both a history and a future. (Kanagal N. (2009) Role of Relationship Marketing in Competitive
Strategy, Journal of Management and Marketing Research Jul 2009 Vol.2 p.97-112.)

- the literature distinguishes between three levels of relationship

marketing. first level - level one relationship marketing- relays on pricing incentives for customer loyalty second level - Level two relationship marketing - focuses at the social aspects of a relationship (by regularly communicating with consumers or referring to their name during an encounter.) third level - Level three relationship marketing offering structural solutions to customer problems . At a level three, the solution to customers problem is designed into the service-delivery system rather than relying on the relationship marketing goes beyond what is usely described as a loyalty program. (Berry 1995)

 Based on value n relationship Should be viewed from

-customer perspective - supplier perspective

Value n value chain

- what is value chain? - value chain for customer - value chain for supplier

 3 aspects of value oriented strategy

- expected retail strategy - augmented retail strategy - potential retail strategy

Retailer relationships
Customer relationships
Customer base
Customer service Customer satisfaction

Loyalty programmes n defection rates

THE CUSTOMER BASE

- Population n lifestyle trends - Attitudes towards shopping

- Reasons for shopping

- Level of loyalty - Mix of new customers Vs loyal ones

CUSTOMER SERVICE
- Activities taken by the reatiler in conjunction with the

goods n services it sells - 2 elements expected customer service augmented customer service - Employee empowerment for customer service

 Developing customer service strategy

- What are the expected and augmented services?

- What level of customer service is needed to complement a

-

firms image? Should there be a choice of customer service? Should customer service be free? How can retailer measure the benefits of providing CS against their costs? How can CS be terminated?

 Planning individual customer service

- Credit cards

*revolving credit account- customer charges an item n s billed monthly on basis of outstanding cumulative balance - option credit account * open credit account - Retailer sponsored cards- advantages and disadvantages - Delivery 3 decisions *transportation method * equipment ownership vs rental * timing

- Alterations and installations

- Packaging complaints and returns handling- centralized or

decentralized (pros n cons)

- Gift purchases, trade ins, trial purchases etc - Sales events n extended hours for regular ones

CUSTOMER SATISFACTION
- 3 categories of retail satisfactions

- shopping system satisfaction - buying system satisfaction - consumer satisfaction - Dissatisfaction in any of the above 3 can lead to customer disloyalty, loss of sales, erosion of the market share - Very satisfied- longtime loyalty Vs dissatisfied - need of feedback

LOYALTY PROGRAMMES
- Frequent shopper program reward the best customers

- Customers perception of value

- 5 types of reward

economic reward people concerned of budgets hedonistic rewards emotional value/ shop for pleasure social relational rewards feeling of privileged group informational rewards for customers who stick for one brand/ store functional rewards for customers who value time

- Loyalty programs common features: useful n appealing

rewards, attainable in a reasonable time, honors shopping behaviour, personalized customer communications, participation rules are publicized etc
- Customer defections