Relationship Marketing in Consumer Markets

Akash C.Mathapati

Akash C.Mathapati

Consumer Choice Reduction as the Basic Tenet of Relationship Marketing The fundamental axiom of RM is or should be, that

consumers like to reduce choices by engaging in on going loyalty relationship

It’s a form of commitment made by consumers to patronize selected products, services & marketers rather than exercise market choice

Thus, form a consumer perspective reduction of choice is the crux of their relationship marketing behavior

Its estimated that as often as 90% of the time, consumers go to same supermarket

Why do consumers engage in relational market behavior ?

Akash C.Mathapati

Consumer Learning Theories & Relational Market Behavior

P: in buying & consuming situations, where there is a greater need to routinize choices because of the efficiency potential, consumers will engage in relational market behavior

Consumers like to simplify their extensive & limited problem solving situations into routinized behavior by learning to reduce the no. of products under consideration into an evoked set

Akash C.Mathapati

P: when consumers are satisfied due to lack of novelty or variety in the relationship. They would disengage from the relational market behavior, including existing from relationship

Conditioning offers a greater potential for response – generalization, consumers will exhibit a relational market behavior E.g., One stop shop – consumers are inclined to

engage & maintain relationship P: the greater the opportunity for consumers to

generalize response to other purchase & consumption situations, the greater will be the propensity to engage in relational market behavior

Akash C.Mathapati

The Sociological Reasons for Engaging in Relational Market Behavior P: the greater the social orientation of the

consumer, the greater will be the consumer propensity to accept family & social norms with respect to relational market behavior

P: the greater the potential of a market choice to fulfill social aspirations or reduce social risks the greater the consumer propensity to adopt relational market behavior

Consumers may not necessarily be a member of the group or be in physical contact with it

Akash C.Mathapati

Some of this behavior may be aspirational in nature or even dissociative

The two underlying motivational dimensions of reference group related consumer behavior are human aspirations and reductions of perceived risk

Akash C.Mathapati

P: consumers will have a greater propensity to engage in relationship with such market choices that are recommended by opinion leaders of referral networks

Social group influence are coupled with powerful word of mouth communication

Why do consumers agree to be influenced by word of mouth communication ?

Akash C.Mathapati

Institutional Reasons for Engaging in Relational Market Behavior P: consumers are more likely to maintain

relationship with those market choices that are mandated by the government, especially if these choices also serve consumers self interest

Purpose here is not to question the appropriateness of such govt policies & regulations

But rather top seek explanation of why consumers abide by these regulations Social & civic responsibility Compliance welfare

Akash C.Mathapati

Religion and Relational Market Behavior P: Consumers are more likely to maintain

relationships with those market choices that their religious beliefs have identified as important to maintain faith in the religion & enhance self-interest

Moral training & spiritual education provided by religious institutions have behavioral impacts on individuals use of products, services, institutions, place etc

Akash C.Mathapati

Employer Influence Influence include norms that relate to

employees are activities outside the organization, such as neighborhoods in which employees are expected to live, the types of automobiles they are expected to drive, social recreation etc.

Employers limit employees choices among fringe benefit items that are offered for personal consumption

Akash C.Mathapati

Marketers Influence or Relational Market Behavior P: consumers will be more willing to accept

marketer-induced choice reduction when marketer policies are positively balanced toward meeting the consumers personalized needs

Although risk-reduction or compliance mechanisms may initiate a favorable response from consumers, ultimately consumers will not accept these institution-mandated choice reductions unless they perceive the limitations to be in their own self-interest

Akash C.Mathapati

The marketing management literature illustrates how marketers influence consumers to reduce their choices through the use of pricing, merchandising etc

Akash C.Mathapati