Relationship Development Strategies

BUILDING RELATIONSHIP MANAGEMENTVELI BAHCECI

Relationship Development Strategies

RELATIONSHIP DEVELOPMENT STRATEGIES

1. Core Service Provision

2. Switching Barriers

3. Relationship Bonds

CORE SERVICE PROVISION• Perceived Service Quality• Perceived Value• Satisfaction

SWITCHING BARRIERS• Customer Inertia• Switching Costs

WHY SOME DISSATISFIED CUSTOMER STAY WITH THE FIRM?

HOW CAN FIRMS RETAIN THE CUSTOMERS?

SWITCHING COSTS• Time Cost• Effort Cost• Searching Cost• Setup Cost• Learning Cost• Contract Cost

RELATIONSHIP BONDS• Berry and Parasuraman

LEVELS OF RELATIONSHIP BONDS

• Financial• Social• Customization• Structural Bonds.

LEVEL 1 – FINANCIAL BONDS• Volume and frequently rewards;

• Lower prices for bigger volume• A more frequent purchase

• Bundling and cross selling

• Stable pricing

LEVEL 2 – SOCIAL BONDS• Personal Relationships• Continuous Relationships

SOCIAL BONDS AMONG CUSTOMERS

• Health clubs• Educational settings• Social groups and service environments etc.

LEVEL – 3: CUSTOMIZATION BONDS

• Customer Intimacy• Anticipation / Innovation• Mass Customization

LEVEL – 4: STRUCTURAL BONDS