As one of the key Competitive Marketing Strategies, Customer Relationship Marketing (RM) plays an important role in enhancing business performance. The purpose of RM defined by Gronroos (1994b,p:9) is widely accepted as:
‘to identify and establish, maintain and enhance and, when necessary, terminate relationships with customers and other stakeholders, at a profit so that the objectives of all parties involved are met, and this is done by mutual exchange and fulfillment of promises’.
Meanwhile, there is no fixed authorized definition of RM by academic. The terms and principles are varied between industry to industry, and even between two relationship marketers (Dann & Dann, 2001). it is suggested that RM should be a continuously flexible conception based on diversity circumstances.
As one of the most important innovations for the recent 20 years, the significant raise of New Media has dramatically altered the RM world. Except traditional one-to-one marketing, loyalty marketing, wraparound marketing, customer partnering and so on described as substitutes of RM, more conceptions are introduced such as database marketing, data-driven marketing, E-marketing and interactive marketing with the application of new media.
What is new media?
Generally, ‘New Media’ is considered as the outcome of the emerging of new technologies such as email, blog, computer games which are highly related to computer especially internet. However, there is no absolute boundary between ‘New Media’ and ‘Old Media’. Amalgamating the traditional media: film, image, music, spoken and written words with interactivity of computerized technologies is another form of New Media.
Martin and Jon (2003, p:13) indicated four aspects included in the conception of ‘New Media’:
Computer-mediated communications: email, chart rooms, blogs ect networking sites and mobile telephony;
New ways of distributing and consuming media texts characterized by interactivity and hyper textual formats such as CD, computer games;
Virtual ‘realities’: simulated environments and immersive representational space;
A whole range of transformations and dislocations of established media (TV, film, photography and cinema).
The terms of ‘New’ contain (Martin, 2003, p:13)
‘ New textual experiences; new ways of representing the world; new relationship between subjects (users and consumers) and media technologies; new experiences of the relationship between embodiment, identity and community; new conceptions of the biological body’s relationship to technological media and new patterns of organization and production’ .
Regarding these, Martin (2003, p:13) summarized the main characteristic of New Media are digital, interactive, hypertexual, virtual, network and simulated. Any traditional media without the technologies that enable digital interactivity can not be considered as New Media (Manovich, 2003). As a result, a digital plasma TV is still a traditional media, while a TV show contains a website address at the bottom of screen for audience to find more information, watch and download the program online and post their comments, communicating with producers directly is an example of new media communication.
The Role of New Media in RM
The emerging of New media has altered the principles and terms of RM, intensively influencing on the market segmentation and market mix definition.
Except traditional social groups like religious and neighborhood communities, there are more groups to divide customers such as lifestyles, subcultures, consumer tribes, brand communities, or resistance movements… Putman (1995). Facebook has created a new lifestyle to build up a social network during internet, gay community or photography group are built up online to gather the people with similar features or cultures together, and the websites built up by brand names are the channels for direct communication between supplier and customer. Much more individual voices are expressed with the help of computerized technology. The market segmentation in RM suggests to emphasis on the community and also individual. One to one marketing and personalized products or service are required by the suppliers in order to keep sustainable relationship with customers (Ranchod and Gurau 2007).
On the other hand, new media is considered to create opportunities for marketing strategies, getting involved into every marketing mix, considering as digital marketing. Peppers and Rodgers (1997) indicate a new marketing mix – the 5-Is: Identification, Individualisation, Interaction, Integration, Integrity. The reshaping format of marketing mix demonstrates the different role of digital marketing played (from lecture 6).
Focusing on continuous development of new technologies, Apple is the role model of provide individualized products for customer which they can personalized their own I-phone, I-pad by downloading software, applications and music on the apple official website. Shopping online is a growing fashion as time saving and convenience in today’s fast packing environment. Official web site is used as an alternative identity for a company, providing comprehensive company profile, product information, and as well as a channel to sell itself and keep relationship with customer. The new media significantly employs new conceptions to the promotion strategies, reaching customers and sending information with mobile-marketing, e-mail marketing and virtual communities.
social media is a new conception within new media, regarding as an optimum way of building customer relationship. Internet has changed the way people communicating with each other, but at the same time, the creation of social media has changed the way using internet (Francisco Rosales,2011). Customers are willing to follow twitter as the main stream of consumption and take part in to the events/projects, becoming ‘fans’ of a company on facebook. Marketing research to understand customer and markets is the first step for RM. With more than 50 million active users on facebook, it is a huge resource to get individual customer information. And subgroups sharing similar interests are more convenient and faster for company to reach to its target audience. There are several methods to reach the page of company by recommendation, searching, or latest news from friends. It is not necessary to ‘like’ a page based on purchase experience but can be company brand, word of mouth, a single part of product or just the content of the page. Kevin Sinclair said that (2005) ‘A personal recommendation will sell more than any advertising ‘. Becoming a fan does not only mean loyalty relationship between customer and supplier, but also sharing the power as opinion leader to influence others. Meanwhile, continuous events and projects held by company on facebook enhance the relationship.
New Media and Buyer Behaviors
The essential of RM is the relationship, which closely related with communication between customer and supplier. Meanwhile, the feature of interactivity provided by new media has perfectly fitted into the criteria.
Before applying new media marketing strategies, two types of customer purchase behaviors are divided and taken into consideration: consumer and organizational buyers. The main differences between them focus on the decision-making process and the people who make the decision. Pre-purchase step takes more attentions for organizational buyer. And suppliers have the chance to take part into the step by providing proposals. Successful purchase experience always lead to re-purchase behavior, sustaining long-term relationship and opportunity to become the direct supplier without bidding. Consumer buyers are individuals with diversity characteristics. They are more flexible to make the decision and be easily influenced by others. On the other hand, comparing with consumer purchase, the same people who make the decision and conduct the purchase behavior, in an organization, there are more people involved, and different people for the decision making and buying.
Regarding these, customer relationship management system is particularly critical for organizational buyer which largely cover the people get involved. And high quality website with unique brand is important to add extra value and success in the proposal process. More personalized and general new media communications are for consumer buyers such as facebook, e-mail and help desk online to direct response to the customer.
Thorsten and Ursula (2000, p:244) regard the application of new media in RM as a more company control over the content of this communication rather than the needs for customer communication. It is the company’s choice to use new media, which type and the content, to reach to different customers.
Relationship Marketing is a flexible conception advancing with the times, combining and blending into new innovations. The terms and principles are continuously changing according to particular time with special technologies. The arising of new media has opened a new era for Relationship Marketing, offering a number of new possibilities for Relationship Marketing, re-definiting the marketing mix, and the communication methods used by customer and supplier. The company controlled new media communication provides considerable information for customers. It is possible to provide customized information regarding to personalized needs for particular customer. Meanwhile, new media technologies are chosen as an optimum method for relationship marketing to make effort on diversity customers.
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