Differences between Traditional Marketing and Relationship Marketing
|Differences between Traditional Marketing and Relationship Marketing
Some of the most significant contrasts between the traditional approach of marketing – which we term the transactional approach – and the emerging concept of relationship marketing are as given below.
The following table differentiates transactional or traditional marketing and the relationship marketing.
Points of Distinction | Transactional Marketing (Traditional Marketing) | Relationship Marketing |
---|---|---|
1. World View | Managing a Company's product portfolio, setting and modifying marketing mix parameters to achieve optimal 4 Ps. | Managing a company's customer portfolio, building long-term business relationship. |
2. Assessment Period | Short duration | Long duration. |
3. Key concepts | 4 Ps, segmentation, branding etc. | Interaction, relationships and networks |
4. Marketing focus | Product / Serivice | Product / Service and Customer. |
5. Marketing goal | Customer acqisition | Customer acquisition, customer retention and customer recovery |
6. Marketing interaction | One-way communication | Interactive communication. |
7. Promotion strategy | Non-personal advertising, brand and image management. | Personal interaction, developing identity as a reliable supplier. |
8. Economic profit & Control parameters | Profit, profit margin contribution, sales, costs. | Additionally: customer profit contribution, customer value. |
9. Orientation | Towards single sales. | Towards customer retention. |
10. Contact | Intermittent customer contact. | Continuous customer contact. |
11. Focus | On product features | On customer value. |
12. Quality | It is the concern of the production staff. | Quality is the concern of all. |
13. Commitment | Limited commitment in meeting customer expectations | Higher commitment in meeting customer expectations. |
One further significant difference between the transactional approach of marketing model and the relationship model is the wider view of the market that it adopts.
In order to build and sustain real customer value, it is important to recognize that relationships must be built with a number of important constituencies.This is called the ‘Six Markets’ model.