1 ©IRWIN a Times Mirror Higher Education Group, Inc., company 1997 Relationship Marketing, Information Technology, and Forecasting

2 ©IRWIN a Times Mirror Higher Education Group, Inc., company 1997 Definition of relationship marketing RELATIONSHIP MARKETING RELATIONSHIP MARKETING is an organization’s effort to develop a long-term, cost-effective link with individual customers for mutual benefit.

3 ©IRWIN a Times Mirror Higher Education Group, Inc., company 1997 Relationship marketing builds on information technology and micromarketing to develop links with individual customers Relationship Marketing Goal is to have the organization develop a long-term, cost-effective individual relationship with customers. Database Marketing Goal is to provide the organization with continuously updated demographic, media and consumption information about households and individuals. Information technology Goal is to design and manage the computer and communications system of a firm to support its micromarketing and relationship marketing actions.

4 ©IRWIN a Times Mirror Higher Education Group, Inc., company 1997 Factors that makes relationship marketing necessary More demanding consumers “Personalized” offerings High quality and value Good customer service Reduced “loyalty” More demanding consumers “Personalized” offerings High quality and value Good customer service Reduced “loyalty” Excessive business costs New product failure Poor quality Costly distribution Misdirected promotional efforts Excessive business costs New product failure Poor quality Costly distribution Misdirected promotional efforts Marketing manager and information technology Note:Blue boxes show consumer and business factors that have made relationship marketing necessary, while green boxes show the data and data collection methods that have made relationship marketing possible.

5 ©IRWIN a Times Mirror Higher Education Group, Inc., company 1997 Customers Relationships Environmental Forces Shareholders (owners) The Organization Society Suppliers SocialRegulatoryTechnologicalEconomicCompetitive Other Organizations Alliances Partnerships Ownership An organization’s marketing department relates to many people, groups, and forces Human Resources Research and Development Information Systems Manufacturing FinanceMarketing Management

6 ©IRWIN a Times Mirror Higher Education Group, Inc., company 1997 Forecasting Approaches Top-down forecast Take aggregate Subdivide into components Top-down forecast Take aggregate Subdivide into components Buildup forecast Sum individual components Derive at total forecast Buildup forecast Sum individual components Derive at total forecast