What are examples of the different relationship levels companies can build with customers?

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Companies have various levels of relationships with their customers, typically centered around two major factors: quality of goods or services and price. Whether companies are selling to consumers (B2C) or other companies (B2B), these principles apply.

Companies that are able to develop a relationship with their customers build a level of trust. The customer trusts that the quality of the goods or services will be at least the same as it has been previously, which, over the long run, allows the company to raise its prices. Customers are willing to pay more for a good or a service that they’ve had a positive experience with previously.

Companies who strive to retain customers may employ loyalty programs. These programs give discounts or free goods or services to their customers in return for repeat business. If a customer is deciding between two goods or services which are equal in price and quality, they will opt for the company that they have a loyalty program with in exchange for future benefits.

Other customers shop strictly according to price and will seek out the cheapest good or service. Companies which promote their inexpensive products must increase the frequency with which they make sales. These companies are less concerned with returning customers and more concerned with making many, many individual sales.

Companies also spend a significant amount of money in sales and marketing in order to break through. Sales and marketing efforts are used to persuade potential customers who are deciding between a company and its competitors. Advertisements and websites play a key role here.

Last Updated by eNotes Editorial on January 27, 2020
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A company can build a relationship with its customers based on the quality of its goods. The customer may associate the brand with quality. In some circumstances, a family may use a brand, thus passing on brand loyalty through the generations. Many car companies use this kind of branding in order to sell their cars.

A company can build a relationship with its customers through contracts. Government contractors use their track records to secure bids on weapons and information technology. In many circumstances, a business may have the niche market cornered because they are the only ones who can produce the product to the desired specification or in the desired quantity.

A company can also build a relationship with a consumer based on its social message. Some people like to buy a certain brand of coffee because it promotes itself as "fair trade," meaning that the company is ecologically sound and pays the farmers a fair wage for their work.

A company can also build a relationship with a customer based on its spokespeople. Fans of Michael Jordan rushed out to buy the newest Air Jordan shoes from Nike because of his branding.

A company can also build a relationship with a consumer because they are the lowest cost or only option for buying a product in town. Many people state that they do not like the local chain stores but that they shop there anyway because of low prices and an unwillingness to drive elsewhere. People without transportation who live close to a store also have these limited options. They shop there normally not because of loyalty, but due to lack of options.

Last Updated by eNotes Editorial on January 16, 2020
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There is actually a company ecology model (Moore, 2006) that varies from company to company, and analyzes the data obtained from customer surveys, sales vs. purchases, and social influencing. From these research models (although there could be several others) these types of relationships between companies and customers have been identified:

Intentional relationship- occurs when a customer uses a specific company over time because of contract negotiation agreements due to quality, price, or availability of resources.

Behavioral relationship- the customer chooses his or her "go-to" company because it is the customer's favorite. This is indicative of a trust factor that has been created between the company and the client.

Dedication relationship- the customer chooses the company because of its name, logo, social influence, or because of the company's association to something that is meaningful to the customer. For example, a young man may switch tea brands, let's say, from Tetley's to Typhoo because Typhoo sponsors his favorite Rugby team. Or, one may prefer to drink Pepsi over Coke (despite of personal taste) simply because Pepsi may be sponsoring animal rights groups that the customer also supports.

Constraint relationships- these are not necessarily positive relationships, because the connection may not be made by the customer's personal choice. This type of relationship occurs when the customer's lack of options leads to the selection of a company that just so "happens to be there". The best thing for a company to do is to increase its levels of quality control and customer service to "gain" the trust of the client and keep the customer fixed.


Research and influence groups divide customer relationships on many more sub-strands of client/company connection, but these four are perhaps the most influential in market terms.

 

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