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    Copyright 2007 McGraw-Hill Ryerson Limited.,

    Building RelationshipsJim Barnes

    B6230

    October 3, 2007

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    Copyright 2007 McGraw-Hill Ryerson Limited.,

    Understanding Relationships Must be defined from the customers view Most are not genuine relationships

    More than databases and loyalty programs

    The relationship is a personal thing

    Its the recognition of a special status

    Must have an element of emotion

    How do we create the real thing?

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    Copyright 2007 McGraw-Hill Ryerson Limited.,

    What A Relationship Is NotSetting up barriers to exit Raising the switching costs

    Getting the customer on a data base Frequent-buyer clubs

    Locking in the customer

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    Copyright 2007 McGraw-Hill Ryerson Limited.,

    You Know One When You See One A relationship exists in the eye of the customer The customer must feel that it exists

    The customer is the object of attention

    We must know how he or she feels about it

    There must be parity; both parties win

    Different segments see it differently

    Some dont want a close relationship

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    Copyright 2007 McGraw-Hill Ryerson Limited.,

    Relationships at Different Levels Hands-on: personal, close, first-name,

    high involvement -- hairdressers,dentists, etc.

    Face-to-face: meetings, conversation --retail, hotels, mechanics, banks, etc.

    Distant: less frequent, via technology,few meetings -- telecom, utilities, etc.

    Brand: contact with customer is throughagents -- consumer products, autos, etc.

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    Key Relationship Indicators Share of wallet: how much of their

    business do we have?

    Level of overall satisfaction

    Strength of the relationship

    Perceived closeness or attachment

    Likelihood of switching their business

    Likelihood of recommending us to others

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    Issues in Customer Relationships Are relationships necessary for retention? With whom does the customer have the

    relationship? Employee or firm?

    With whom do we want a relationship?

    Can relationships and technology co-exist?

    Are empowered employees necessary fora relationship to exist?

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    Whats a Relationship, Anyway? do all customers want a relationship? what kind of relationship do they want?

    what are their motivations for entering

    into a relationship?

    some are entered into willingly; othersagainst their will -- they have little

    choice need to understand their motivations

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    Meaningful Relationships three established streams of

    research: social psychologists

    consumer psychologists cultural anthropologists

    meaning lies within the individual

    relationships add and structuremeaning in our lives (Fournier)

    implies closeness and attachment

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    Research on Meaning interpersonal relationships: what it

    means to be in a relationship

    brand relationships: what meaningcertain brands have for consumers

    consumption objects: what certainpersonal possessions mean to the

    owner

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    The Meaning of Meaning (1) First, a literal or semantic meaning

    what does the company or brand say

    about its attributes and performance?

    grounded in words and conversation

    what meaning does the consumerattach to the communications of a

    firm?

    does not represent the totality ofmeaning

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    The Meaning of Meaning (2) Second, a cultural/anthropological view the cultural meaning of the firm or brand as

    communicated mainly through advertising

    imbues the firm with appropriate meaning

    result of a positioning/branding strategy;attempt to achieve consensus; shared

    meaning

    this kind of meaning is company-determinedand resides in the firm or brand

    branding is acquisition of agreed-upon meaning

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    The Meaning of Meaning (3)

    Third, meaning as internalized by consumers;how things come to mean something specialto them; the achievement of special status

    closely related to attachment; centrality

    resides only in the customers mind;idiosyncratic

    related to the concept of self, to life events,and to the accomplishment of life tasks

    a company with clear communications and abroad consensus on brand image may stillmean nothing to the individual consumer

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    The Acquisition of Meaning how do firms/brands come to mean

    something to their customers? toachieve a state beyond

    instrumentality? combination of functional and

    emotional routes to the achievement

    of meaning

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    The Functional View accomplishment of life tasks, deal with

    issues; helps get things done

    exceeds expectations, behaves

    differently, go beyond the expected:_____ means more to me than just a

    supermarket

    coordinated interdependence: Idepend on them to _____

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    The Emotional View meaning is acquired as relationships come to

    reflect self or ideal-self: Im a Tommy girl!

    the firm or brand shares things with me, weare alike in many ways; they are people like

    me, overlap of values, beliefs, history the firm or brand reminds me of pleasant

    things, people, events

    the firm or brand associates with the thingsand people with which I associate; borrowedmeaning

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    Strategies for Meaning Creation different meanings for different segments what do we want to stand for and mean,

    and to whom?

    delivered through communications and howwe behave as a firm or brand

    understand their meaning systems andshare in them

    need insight into whats important, centralin customers lives hence the need for theright kind of customer research


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