Relationship Marketing and empathy

In the modern world, business competition is fierce. To ensure longevity and the achievement of predefined outcomes, the business environment has embraced various business aspects. Fundamentally, a business is founded to turn a profit, follow a particular path in society or the market, and broaden its market for greater financial advantage. A crucial component of business models is empathy. It is the capacity to approach commercial concerns with humanity. For instance, empathy engagement can help the business comprehend the client's situation and offer him or her many compassionate solutions when the client is in desperate need of a certain product but unable to gather the required amount. These options can be giving the client the product at a discounted price or offering the client the product to be paid later rather than denying him or her. As such, good business is propagated. Cognitively, people forget what is done for or to them but never forget how someone or something makes them feel. Therefore, it is important to be take care of the feelings of clients and every other person involved in business. Correspondingly, relationship marketing is a core element of the discussion herein. Relationship marketing is a revolutionary form of marketing that has initiated change in business. Therefore, the interplay of empathy and relationship marketing in business models is herein discussed.

Business models include manufactures, retailers, distributors, data handlers and franchises (Root, 2015, p.1). These are businesses that have organizational perspectives and have the need to maximize their profits. Notably, clients, employees and employers have to coexist in a peaceful environment with mutual understanding. Lack of a mutual understanding might lead to serious business losses. Businesses are in different market settings; some are in monopolistic settings, others in oligopolistic settings while some are in perfect competition settings. Each of the mentioned setting influences a business to behave differently from when in another model. Manufacturers are concerned with production. Relationship marketing ensures that goods are manufactured to meet the client needs and not mass production like as is the case with transactional marketing. Relationship marketing has an in-depth understanding of the client (Hennig-Thurau and Hansen 2013, p.16).Empathy here is engaged when the manufacture ensures that the product being made is not only attractive by design but also effective and easy to use, clients always want value for their money.

Distributors buy goods directly from manufacturers to sell them to the retailers of the public. Here, price value is important as well as convincing retailers why they should buy a certain product hence the needs for relationship marketing. The distributor has to identify a niche and needs in an identified market. Resultantly, the distributor should ensure the best products to fit the gap are bought from the manufacturer and sold to the retailer. Discounts and friendly packages are empathic and make the retailer feel appreciate and taken care of by the market system (Boren 2010, p.8). The result is good business which transcends down to the retailer and client hence increased revenue.

Retailers are examples of business models that are inclined to pricing. This is because they source goods’ distributors and have to make profits for continued business. As such, a retailer has to understand his or her target market, financial abilities, preferences, and needs (Job 2016. p.1). All this is empathy; a business that lacks the understanding of its market is doomed to extinction. Therefore, pricing is of the essence. Friendly prices should be designed to meet the client’s financial ability as well as the organization’s operational needs. Unscrupulous pricing will only lead to serious losses especially through the dissolution of customers’ commitment to substitute offers.

Data handlers are business models that offer information as a commodity or rather product. Today, information has great value. There are Big Data Companies that require information and at the same time sell information. The information is mostly needed for marketing processes. Trends and preferences are observed to help know the behavioral patterns of an identified population. This is a business model that is in the technology realm, it moves huge sums of money within it since it is a unique and relatively rare model (Columbus 2016, p.1). Unlike distributors and retailers, data handlers have little physical presence in a country but dominant on online settings. Here, information is sourced empathically. Pop-ups on websites can be seen to ask for information. When registering on forums or for jobs details have to be keyed in certain websites. It has been made a formality to key in information while accessing particular sites. Confidentiality and security is assured since this is what makes human feel safe and respected. Whatever the data handlers do with the information is not in the client’s knowledge. The organization is in business and through sourced information it can use relationship marketing online for instance through copywriters who happen to be adept in advertising and marketing techniques.

Franchises circumvent what the aforementioned models do. Franchises have a deep engagement of empathy and relationship marketing. Looking at behavioral perspectives; relational constructs such as trust and satisfaction are looked at. This is both at employee and client levels. Employees are motivated with better pay, good working environments and enticing benefits. Clients on the other hand are given what they need; quality, value for money and room for feedback (Varotto 2016, 16). Feedback is treated seriously as it determines clientele loyalty to a business. Providing room for feedback increases trust and satisfaction which are proponents of a successful business. Furthermore, a network approach is used where an interactive character of business to business marketing is instituted while it adopts an inter-organizational perspective. This is elemental to the growth of a business as many players in the markets thrive on interdependencies, in fact no business can exist on its own without depending on another.

Lastly, relationship marketing instruments used include pricing, communication, products and services, and distribution. Pricing has been discussed earlier on that it should be fair and competitive. Communication is done persuasively and in an honest manner that will reflect a franchise’s corporate culture. Products are well designed and their effectiveness maximized, services include customer handling and advising. Clients need attention from a business. Attention makes clients feel recognized hence see the need to engage a company more in business. Moreover, empathy leads to adept decision making which is seen trough novel institutional economics approach where there is the development and breakdown of relationships, matching of business dimensions to relationships, and transaction as well as agency theories. Businesses are always looking for new clients through market research; this enables them to stay abreast with current market needs which clients determine or rather dictate. Different business dimensions have to be matched to certain relationships; some businesses have varied policies that lead to unnecessary market segmentation. As such, franchises ensure the best fit between clients and business dimensions by making flexible as well as flexible business policies. The transaction and agency theories aim at managing identified relationships while minimizing costs. Above all, business models strive to engage empathy and relationship marketing for maximum customer retention and continued business.

Summarily, clients determine the direction that business models take. Therefore, businesses have to do adroit research to suit client preferences, needs, and financial abilities. Effective use of relationship marketing instruments is rewarding to a business through increased client loyalty which motivates a business to do better. Further, engaging empathy in decision making is vital as it is an element of emotional intelligence that attracts clients to a business. Businesses should therefore have a seamless interplay of empathy and relationship marketing for assured success in business.

References

Boren, Amy E. Emotional Intelligence: The Secret of Succesful Entreprenuership. Nebraska: University of Nebraska, 2010.

Columbus, Louis. Ten Ways Big Data Is Revolutionizing Marketing And Sales. May 9, 2016. https://www.forbes.com/sites/louiscolumbus/2016/05/09/ten-ways-big-data-is-revolutionizing-marketing-and-sales/#106fa4c621cf (accessed March 9, 2017).

Hennig-Thurau, Thornsten, and Ursula Hansen. Relationship Marketing. Hannover: University of Hanover, 2013.

Job, Alison. 4 Types of Business Models. August 15, 2016. http://www.entrepreneurmag.co.za/advice/starting-a-business/business-model/types-of-business-models/ (accessed March 9, 2017).

Root, George N. Types of Business Models. March 21, 2015. http://smallbusiness.chron.com/types-business-models-79.html (accessed March 9, 2017).

Varotto, L F. Franchisor-Franchisee Relationship Quality. London: Prentice Hall, 2016.