MARKETING PRACTICES FOR CUSTOMER RELATIONSHIPS: AN EXPLORATION IN BUSINESS-TO-BUSINESS (B2B) BETWEEN ICHITAN GROUP PCL AND DISTRIBUTION CHANNEL ON MODERN TRADE. Today, customer relationship management is probably one of the most important strategies in marketing. The purpose of this research is to find out how important customer relationship management is between business-to-business (B2B).
The case study of the company, Ichitan group PCL, and its distribution channels, which focuses on modern commerce and to find out how to build or maintain relationships with the customer.
Problem Statement
Research Objective
How to build and maintain customer relationship management with an emphasis on the relationship between the company and the distribution channel in the modern trade. I am determined to focus intensively on this case and would like to forward the result to Ichitan for his improvement and better management.
LITERATURE REVIEW
Relationship Management
- Customer Relationship Management and Client Relationship Management (CRM)
- Developing Buyer-Seller Relationship
Today, the focus of marketing has progressed from a simplistic idea of giving customers what they want to building and maintaining mutually satisfying long-term customer relationships and developing long-term customer retention strategies. This fickleness has fostered a growing sense of awareness of the long-term financial benefits that relationship marketing can bring. Relationship marketing is based on two economic arguments: It is more expensive to win a new customer than it is to keep an existing customer.
The longer the marketing association between a company and a customer is, the more profitable the relationship becomes for the company (Gronroos, 1994). The overall goal of relationship marketing is to build, maintain and improve a long-term buyer-seller relationship. This is further supported by Gronroos (2001), who introduced a three-phase customer relationship life cycle: initial phase, purchase phase and consumption or use phase.
He argued that it is always cheaper to make a repeat purchase with a satisfied customer than to take a new customer through the customer relationship life cycle to the end of the purchase phase. In other words, it is more fruitful to have as many profitable long-term relationships with customers as possible. Various specialists have studied relationship marketing in an industrial marketing context and in a service industry context.
Business-to-Business (B2B) Relationship Management
- Business-to-Business (B2B) Relationship
The Relationship Development Process Review
- Relationship between buyer and seller by Dwyer, Schurr and Oh From Dwyer, Schurr, and Oh (1987), relationship between buyer and seller
- Relationship Process by Ford
- Relationship Process by Dion
- Relationship Development Process
They also present five stages in this time-phased evolution of the buyer-seller relationship: the pre-relationship, the early stage, the development, the long term and the final stage. According to Dion et al. 1995) any relationship management process must examine the effect of identity qualities and types, together with trust, around the buyer-seller relationship. For their model, five key variables would be examined, namely the personality of that seller, buyers and dealers for similar custom types, buyer-seller recognition, custom similarity, trust, and relationship between the buyer's recognition of buyer-seller similarity and real comparability between buyer and seller. .
At this stage, there are various unusual and less trusting relationships between buyer and seller. A two-way correspondence is needed to examine the benefits of constraining a relationship and to assess the hypothesis and change required to make the relationship work. The exchange results at this stage will demonstrate the limit and status of the dealer to convey satisfaction to the buyer.
Typical consideration and cooperation are basic elements for moving a relationship into a developmental phase, as rapid experience is a necessary reason for judging the temperament of a relationship (Dwyer, 1987). A relationship at this stage can create trust, work process standards, and association exchange standards. Accountability means the stage in which exchange participants have completed an abnormal state of satisfaction with the exchange process, thus motivating both parties to stay in the relationship and dismiss other vital exchange partners who could provide similar points of contact.
RESEARCH METHODOLOGY
Research Scope
One of the limitations of observational research, despite the power to see what is happening, is the inability to understand why it is happening. The last method is to analyze secondary data collected from previous study, newspaper, website and other online sources. The objective of this technique is to collect information from the organization or external sources and prove a critical component of this study in order to support the result from the aforementioned methods (Stavros & Westberg, 2009).
In this case, I choose people involved in Ichitan's business and distribution channel such as sales team, marketing team and distributor team to understand their situation and context, to find out a good opportunity to identify unexpected results, exist in natural, unstructured, flexible framework, ability to experience the affective as well as cognitive aspects of responses and explore it in the appropriate way. This interview uses the open-ended questions to help us dig deeper into the details. Reflective note taking is also used to record observed data because it will help us to note down important words and to remind the key point of what we need to do.
People involved and working related to customer relationship management of Ichitan and DKSH like sales and marketing department.
Research Question
FINDING AND DISCUSSION
Finding
- Create trust and constancy on each other
- Get to know, understand and listen to each other
- Personal Relationship in Thai Context or Thai Culture
- Win-Win Strategy: Giving and Taking
- Priority Management
- Dealing with Strategic Level and Skillful Person
The above detail will be a strategy that will satisfy customers and help maintain good relations with them in the long run (Interviewee 7, personal communication, November 4, 2015 and Interviewee 5, personal communication, November 4, 2015). Compared to the customer relationship development process (Dwyer, 1987), the pre-relationship stage is the most important because customers lack sufficient information and trust in the company. Ichitan and DKSH expect these activities to develop customer trust, to jointly facilitate business, increase their own bargaining power, and jointly gain more benefits in the end stage.
After knowing each other enough, the bargaining power of the company would be better, and this will be the factor that reflects long-term benefits for Ichitan and their customers in the better way. These activities are involved in all stages of the client relationship process, as they are the tools that encourage company and client to help each other and understand what to do together in the next phase. Sometimes it's about the performance support” (Interviewer 8, personal communication, November 5, 2015), the example is the performance support that Ichitan uses, such as launching a campaign plan or TVC to stimulate sales in a particular channel.
The relationship management process and the win-win strategy will be linked together in the exploration phase, expansion phase and stable phase, to create a long-term exchange and relationship, and continue the benefit together. Number of sales also Contribution of sales compared to other channels in the same segment. This priority management will be important in the expansion and stabilization phase as it will match the company you are for a while and how the company can handle them in the long term.
Managing strategic level and skilled person Expansion stage Create trust and stability for each other. Managing strategic level and skilled person Stable Stage Create trust and stability for each other.
Discussion
CONCLUSION
- Conclusion
- Managerial implication
- Theoretical implication
- Limitations and Future Research
In my opinion, this project is different as it focuses on Thai business under Thai culture. This allows employees to work in an atmosphere of family business, doing business with relationships, combined with hierarchical system and lots of tactics to work with relationship management. When we compare with the previous study on customer relationship management, there are not so many papers that focus on Thai business or even on rural business management style.
Moreover, it would be better if there is a study on the difference between customer relationship management and the different practices in different continents such as Asia, Europe and America. Even the interviewees for this project are also the key person, who is involved in everything related to customer relationship management of the Ichitan company. Further testing the relationship between an international company and their customer, such as Modern Trade, helps us better understand what should be compared to a Thai company like Ichitan.
Testing the relationship between the Thai company and their customer such as traditional trade is also another way that helps us better understand how the Thai company works in managing the relationship with wholesalers or retailers. Regarding the recommendation, from my interview on the activities, the finding illustrates that not all those who have the 6 activities. This will allow them to understand work techniques or how to create effective customer relationship management.
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APPENDICES
Appendix A: A Key Interview Question
To explore individual perceptions of client relationship marketing
To understand client relationship marketing practices
