Relationship Marketing Report: TESCO plc ltd. and Trading Scents ltd.

This report provides a comprehensive analysis of relationship marketing, contrasting it with traditional marketing approaches and highlighting the benefits for both consumers and businesses. It explores the strategies employed by organizations like TESCO plc ltd. and Trading Scents ltd. for developing and assessing the effectiveness of their relationship marketing initiatives. The report defines key terms, outlines the differences between relationship and traditional marketing, and discusses the advantages of successful relationship marketing for both parties. It also examines specific methods used by the featured companies, such as referral and loyalty programs, social media engagement, corporate website analysis, and market research, to build and evaluate customer relationships. The conclusion emphasizes the importance of relationship marketing in fostering long-term customer engagement and its impact on business success.

Relationship Marketing

Contents
INTRODUCTION...........................................................................................................................1
TASK...............................................................................................................................................1
Explanation of terms used in the report.......................................................................................1
Explanation of difference between relationship marketing and traditional marketing................1
Benefits to consumers and business organisation of successful relationship marketing.............1
Methods used for development of relationship marketing by different organisations................2
Methods used for assessment of effectivenss of relationship marketing.....................................3
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Relationship marketing aims at development of long-term relationships with customers of a
business organisation unlike traditional marketing (Hennig-Thurau and Hansen, 2013). In the
following project report, an attempt has been made to understand the importance of relationship
marketing with an organisational context of TESCO plc ltd., a leading multinational grocery
retailer and Trading Scents Ltd., a perfume manufacturing company based out of UK. The report
also aims to evalute the strategies used for relationship marketing development and assessment
of its effectiveness by the managers of TESCO plc ltd. and Trading Scents ltd.
TASK
Explanation of terms used in the report.
Relationship marketing can be defined as the part of customer relationship management
which aims on development of long-term engagement of customers and customer loyalty for a
brand instead of short-term goals and objectives of individual sales and consumer acquisition.
Simply put, one of the most important objective or aim of relationship marketing is creation of
strong and emotional connections with a brand which can help a business in maintaining
customer base, free promotion on word-of-mouth basis and obtaining information required for
further lead generation.
Explanation of difference between relationship marketing and traditional marketing.
Relationship marketing aims at development of long-term relationships with the customers
of a business organisation whereas traditional method of marketing has the main objective of
increasing short-term and individual sales. Relationship marketing is a communication between
the customers and a business organisation whereas traditional marketing is more of a one-way
dialogue originating from a business organisation (Payne and Frow, 2017). Returns obtained in
relationship marketing on customer acquisition cost is much higher than traditional marketing
because a customer may or may not enter into a sales transaction with the business firm in case
of traditional marketing.
Benefits to consumers and business organisation of successful relationship marketing.
Relationship marketing is beneficial for both the customers as well as the organisation.
Benefits of relationship marketing for both the parties are being discussed below.
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Benefits to the consumer: Relationship marketing helps the customer in improving the efficiency of purchase
decision and reducing the amount of time required in making the decision. The principles of relationship marketing provides the customer with a better value for the
money spent and a high quality of products and services. A close relationship between the customer and a business organisation helps in
satisfaction of the personal needs of the consumer which leads to better customer
satisfaction. The benefits of relationship marketing from a customer perspective may include
reduction of risk, improved economic advantage and increase in the confidence of the
customer.
Benefits to the organisation:
 Relationship marketing helps an organisation to increase the rate of customer retention
which is always desirable by managers of any organisation (Gummesson, 2017). High
rate of customer retention means adds sustainability and helps a company in maintaining
in its competitive advantage. Customer acquisition cost is a major concern for every business organisation and
manager aims to increase the return obtained from incurring these costs. Relationship
marketing focuses on long-term engagements with the customers and as a result, return
on investment of customer acquisition increases. Having a good relationship with the customers helps an organisation to obtain better
feedback and increase the efficiency of surveys and market research campaigns.
Customer who expects a company to listen to their feedback will provide more valuable
opinions on how to improve the utility of the product or service being offered. Keeping the customers happy with the help of tools used for relationship development
helps a company to enjoy better customer reviews which attracts more customers.
Customer reviews are of great significance particularly for online business operations.
Methods used for development of relationship marketing by different organisations.
Methods used for relationship marketing by TESCO plc ltd:
TESCO plc ltd. is a leading grocery retailer in UK which was founded in the year 1919
by Jack Cohen. The company has a large customer base and a market share of approximately
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27% in UK markets. Operations of the company are scaled internationally in more than 7
countries. Various methods are used by the management of the company for development of
relationship marketing:
Referral Programs:
Word of mouth is a great way of development of relationship marketing. The
management of TESCO plc ltd. makes use of various types of referral programs which includes a
discount or incentive on referring the products to someone else. This helps the company to
develop long-term and meaningful relationships with the customers and at the same helps the
organisation to gain new customers. Under referral programs, customer himself becomes an
advocate of the brand and his own unique experience with the product or the service gives him
the advantage to describe the benefits of using the product in a much better manner. Loyalty
programs used by TESCO plc ltd along with referral programs work in complete alignment and
harmony on the path of building better emotional and personal relations with the customers of
the organisations.
Methods used for relationship marketing by Trading Scents ltd:
Trading scents ltd. is a beauty and cosmetic manufacturing company based out of UK
which was founded in the year 1992. Over the years, management of the company has been able
to adopt strategies for better relationship marketing, a few of them are being discussed below:
Social media engagement:
A constant engagement with the customers on various social media channels such as
Facebook, Instagram etcetera helps the managers of Trading Scents ltd to develop and build
better relations which are expected to exist for long-term (Clark and Melancon, 2013). Social
media platforms allows the management of the company to listen to customer grievances and
provide satisfactory resolutions which lead to better relationship development.
Methods used for assessment of effectivenss of relationship marketing.
Assessment of the effectiveness of relationship marketing programs is very crucial for any
organisation and various methods which are being used for the purpose are as follows:
Assessment of effectiveness of relationship marketing by TESCO plc ltd.:
Corporate Websites:
The management of TESCO plc ltd. uses effectivenss metrics based on click-per-visit on
corporate websites to determine the effectiveness of relationship marketing. It determines the
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average number of clicks which should result in a sales transaction (Christopher, Payne and
Ballantyne, 2013). An increase in the number of clicks without a sales transaction happening
determines the level of effectivenss of relationship markeing strategies used by company.
Assessment of effectiveness of relationship marketing by Trading Scents ltd.:
Market Research:
The management of Trading Scents ltd. uses the traditional approach of market research
and surveys to determine the level of connection and relationship between the customers and the
organisation based on the outcomes from the survey findings on a adeqaute sample size. It
determines the degree of sales promotional tool required for changing the buying preference of
the customer.
CONCLUSION
It can be concluded from the above report that relationship marketing is a management
approach which aims to develop long-term relationships with the customer unlike traditional
marketing where the main focus is to increase individual sales. Relationship marketing is
beneficial for customers as well as the organisation in many ways such as increasing return on
investment. At last, it can be concluded that various methods are used by managers of different
organisations to develop relationship marketing and assess its effectiveness.
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REFERENCES
Books and Journals
Christopher, M., Payne, A. and Ballantyne, D., 2013. Relationship marketing. Taylor & Francis.
Clark, M. and Melancon, J., 2013. The influence of social media investment on relational
outcomes: A relationship marketing perspective. International Journal of Marketing
Studies. 5(4). p.132.
Gummesson, E., 2017. From relationship marketing to total relationship marketing and
beyond. Journal of services marketing.
Hennig-Thurau, T. and Hansen, U. eds., 2013. Relationship marketing: Gaining competitive
advantage through customer satisfaction and customer retention. Springer Science &
Business Media.
Payne, A. and Frow, P., 2017. Relationship marketing: looking backwards towards the
future. Journal of Services Marketing.
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