Do Business Well

As has already been mentioned, relationship marketing is not new in reality, and this is particularly true for B2B. For example, Marks and Spencer used to have a policy of dealing with a small number of ‘partner’ suppliers, some of which had been involved for many decades. When Marks and Spencer personnel visited a supplier, it was referred to as a ‘royal visit’ ; ‘Factories may be repainted … and machinery cleaned: this reflects the exacting standards’ (Jobber 2001: 106). Marks and Spencer may have moved away from that policy in recent years, but it has to be noted that the change did not coincide with a major improvement in the company’s fortunes.

In this type of relationship management, there are increased pressures put on to suppliers to maintain high levels of service and reliability. Customers, though, often provide increased technical support and expertise to suppliers. Because such partnerships are long term, the partners can invest in systems that ensure good communication, reduced risks and efficiency, such as Just in Time (JIT) and EDI (considered further in Chapter 8). For the supplier, such systems have the advantage of increasing switching costs; that is, making it expensive for the customer to change supplier. This is the sort of system used, for example, by Nissan in Sunderland (UK) in car production. The seats and upholstery are ordered from the supplier only forty minutes before they are required on the production line. In that time, they are assembled and delivered to where they are required. With such tight restraints on efficiency, reliability is enforced.

Mini case study: CISCO

Cisco Corporation is a world leader in integrated information exchanges based on Internet technology and a major provider of the infrastructure that makes the World Wide Web work. Its customer relationship systems include:

• an online customer enquiry and ordering system taking 80 per cent of the company’s orders;
• a Web site on which customers can design and price-switch and router products;

an online customer care service so that customers can identify solutions from the data warehouse of technical information and download software directly. Cisco estimates that this has saved $250 million per year in distributing software plus $75 million in staffing customer care.

Possibly related posts: (automatically generated)
Business to Business (B2B) Relationship Marketing

• Relationship Marketing
• Managing Stakeholder Relationship
• Redrawing Electronic Commerce Customers Marketing Organizational Boundaries
• Some Franchise Terminology
• Internet Marketing, as the voice of all customer communication, Ecommerce the power of Networking
• Challenges of building online customer relationships
• Managing Stakeholder Relationship (continue)
• Resolving Conflict - the Choices
• Relationship Franchise Agreement - Operations Manual
• Categorizing Internet Direct Marketing Players continue...

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