CHAPTER 2:
CUSTOMER
RELATIONSHIP:
CUSTOMER SERVICE
• A customer is a person or
organization that transacts with
a business person or business
organization to buy goods or
services for monetary or other
valuable considerations.
What Is Relationship Marketing
Relationship marketing is a form of marketing
that focuses on customer transactions and
retention, more than a simple sales transaction.
The idea is to build strong relationships with
individuals you have sold or will sell to.
The hope is to grow their loyalty to your
business, so they won’t look elsewhere for
similar products and services.
• Acquiring and keeping customers is the end goal of
businesses because customers create demand.
Through customer’s purchases, organizations are
able to cover manufacturing costs, operating
expenses, and generate profits. Because businesses
have to be sustainable, products or services are not
expected to be purchased only once. They need to
be purchased over and over again in order to
maintain profitable and sustainable operations.
• Customers have varying needs and preferences
over time, organizations must be able to offer
products and services at the time when customers
need them. Marketers cannot force the customers
to buy any product or service that the company
offers. Instead, consumer needs and wants must
be understood and anticipated, as well as be
satisfied adequately and exceedingly. Companies
must predict customer needs.
• Since there are other businesses that offer the
same product or service to the same
customers, companies outdo each other in
terms of value offering. Once an individual
becomes a customer, everything must be done
to ensure that the customer is kept and
retained.
• Customers wield tremendous influence over other
people. A satisfied customer shares his experience
with relatives and friends, which can result in
additional sales. On the other hand, when a
customer is not satisfied, the experience he shares
will dissuade other people from purchasing the
product. This becomes a cause for concern when
the customer vents his dissatisfaction to social
media which has the tendency to magnify these
positive and negative experiences.
Customer Value is the perception of what a product or
service is worth to a Customer versus the possible
alternatives.
• Worth means whether the Customer feels s/he or he
got benefits and services over what s/he paid.
• The benefits include the advantages or quality of the
product, service, image and brand of the company or
the brand of the product, values, experience, success
one gets in using the product and so on.
• Customer service is the process of ensuring customer
satisfaction with a product or service. Customer service can
take on many forms- salesperson, assistance, product
delivery, technical advice, help desks, or other means like
company websites, social media, and blogs to provide
platforms for customer feedback. It involves activities
designed to enhance customer satisfaction, or the
perception that a product has met or exceeded expectations.
• This perception can be shaped and influenced by the level
and type of service that customers receive before, during,
and after the actual purchase. Good customer service can
lead customers to perceive the value offered as superior
over its competitors. This is because a customer not only
buys a product or pays for a service, but also the entire
purchase or shopping experience.
• The value of customer service is evident in the
local setting. As Philippine organizations
become involved with Association of
Southeast Asian Nations (ASEAN) and global
business, the importance of service quality
increases. Due to exposure to western
practices, Filipino consumers are becoming
more sophisticated and discriminating. They
are also more demanding in the level of
service that they receive.
Maintaining customer service quality is important to ensure the
sustainability of the business. Disgruntled customers tend to tell others
about a bad service experience more often than a pleasant one. This can
lead to deterioration of the organizations image. It shall be perceived as
being unable to deliver the level of service expected by customers.
How do an organization maintain its high level of customer service quality?
Develop and train competent contact personnel
Design and implement a superior service delivery environment and
process
Assess periodically how well services are delivered
The following are some of the more popular customer service practices in the
Philippines:
Customer Service Practice Practicing Organization(s)
Free delivery Most restaurants and fast food chains
Automated in-home ordering system Most department stores and drug stores
Free gift wrapping/plastic book jacket Most departments stores and bookstores
Merchandise/document pick-up Selected courier services
Free parking Some churches and religious organizations
Valet parking Some hotels and resorts
Reservations, installment plans Some large departments stores, bookstores
Complimentary refreshments, waiting lounge Most car dealerships
Help desks, touch phone access, 24-hour Most utility firms and telecommunication firms
customer hotline
Free appliance installation Most appliance centers
Scheduled floral bouquet delivery Some flower shops
Drive-through Most fast food outlets
Free alteration on garments Selected apparel retailers
Complimentary massage Some barbershops and salons
Customer relationship management (CRM) is a
term that refers to practices, strategies and
technologies that companies use to manage
and analyze customer interactions and data
throughout the customer lifecycle, with the
goal of improving customer service
relationships and assisting in customer
retention and driving sales growth.
Creating record and keeping personal
information: customer names, birthdates,
contact numbers, physical and email addresses.
Creating Shopper’s club through membership
card
Encouraging customers to drop their business
card into a glass bowl
Requesting customer responses on service
feedback forms after a shopping or dining
experience
• Customer database information is used to update
customer’s buying history and behavior( what they
buy, when and where they buy, in what quantities and
prices, and their responses to sales promotion efforts).
• It is also used in customer segmentation and profiling:
– Address- these information could include the geographical
area of their residence or work, the distance they are
willing to travel to shop.
– Age profiling-Make the most of information gathered by
customer service and sales reps to fine-tune your marketing
strategy to find more people who are the right fit for your
product.
– Occupations-
– Birthdate- can reinforce relationship with the customer
through personal greetings from store personnel.
– Email address- update customers on new merchandise,
promotional offers, and other store activities.
– Shopping history- can be used to accurately identify the
type of merchandise frequently purchased, the amount
spent, the preferred days for shopping, etc. Tailor the
customer journey based on each lead’s behaviors to
provide them with the information and interaction they
need at just the right time to create more sales
opportunities.
– Promotions- customers will only receive those that truly
interest them and are most likely to
purchase( personalized). Personalize marketing messages
for each individual to increase your response rate,
engagement, and even brand loyalty.
• Use information shared during the sales and marketing
process to provide personalized service for new
customers, increasing their willingness to spend money
with you and stay for longer.
• Improve the quality of your sales conversations with
leads by using all the information you have gathered
about their preferences, needs and pain points to show
them how your product or service provides the right
solution.
• Use the data collected about all your customers and
leads to understand your business performance and
project your future earnings based on your current
pipeline.
