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Dissertation Proposal

A proposal submitted in partial fulfillment of the requirements for the Degree of Master's Pratisurya Anand MBA IB Marketing PRN: 12020241092
Mentor: Dr. Gaganpreet Kaur Ahluwalia Co-Mentor: Ms. Shilpa Kulkarni IB Marketing 20th December, 2013

Title:
Study Customer relationship management as a subset of Relationship marketing, and analyse its rule in todays business environment.

Abstract:
Customer relationship management (CRM), also known as relationship marketing, has recently emerged as an integral marketing concept in the business world. In an attempt to reach and connect with customers in an environment highly saturated with products, advertisements, and promotions, businesses are implementing a customer relationship management component in their marketing schemes. CRM practices enable marketers to build long lasting relationships with consumers at the individual level through the use and management of a number of different programs and key components.

Introduction:
As a relatively new practice, the definition of customer relationship management has been debated by field experts and is ever evolving. In fact, the term has come to mean different things to different individuals and organizations. In its inception, customer relationship management was narrowly defined as promotional marketing based on a customer database (Bickert, 1992). Peppers and Rogers define CRM to be a complex process that builds one-to-one relationships with customers in order to achieve long term growth (1993). According to Gronroos, relationship marketing extends past persuading customers to buy products; it is about fulfilling their expectations in the hope of transforming them into long term, loyal customers (2009). Most experts can agree, however, that the central theme of CRM is carefully selecting the most valuable customers and maintaining and strengthening relationships with those customers for long term profit maximization. Sheth and Parvatiyar define CRM as a comprehensive strategy and process of acquiring, retaining, and partnering with selective customers to create superior value for the company and the customer (2001, p. 5). It is a mutually beneficial relationship built upon a foundation of trust and loyalty through marketing, customer service, and relationship programs.

Literature Review:
Customer relationship management is a relatively new field, but its importance is becoming even more evident as time passes. The paradigm shift from focusing on attracting new customers to retaining current ones is at the backbone of CRM (Winer 2001). Reichhelds studies revealed that small increases in customer retention rates greatly increased profits, proving that long term customers can be more valuable (1996). More revenue on average is generated from repeatpurchase customers when compared to one time buyers (Reichheld 1996). With potential profit maximization in mind, businesses are turning to customer relationship management in order to better understand customers. Traditional marketing and mass advertising are proving to be ineffective in such a commoditized environment. With the number of similar products on the

market increasing and competition among the firms escalating, companies must look toward capturing customers on some factor other than product quality, price, or convenience (Brown 2000). They must focus on building unique, one to one relationships with customers based on individual needs and wants; thus, implementing customer relationship management is critical to the growth and future success of firms.

1. Relationship marketing tactics: Relationship marketing is carried out with many relationship
marketing tactics, which are widely to be applied in todays business. Many tactics may have potential to influence relationship quality and retaining customers. On basis of previous researches, four ways of implementing relationship marketing tactics are focused on this study, such as service quality, price perception, value offers and brand image. These four tactics will be discussed in detail in the next chapter.

2. Relationshipquality: It is usually used to assess the effectiveness of relationship marketing tactics. It


is also considered to be antecedent of achieving customer loyalty. Customer satisfaction and trust are two basic components for measuring relationship quality. Higher level of relationship quality is reflected by higher level of customer satisfaction and trust.

3. Switching costs: It happens when a customer switches from an existing service provider to a new
one. Switching costs perceived by customers can be either monetary or non-monetary (time, effort, risk taking, psychological nature, etc.). It is considered as a barrier that influences customers

decision to change service provider, in turn affect customers willing to remain loyalty with current service provider.

4. Customerloyalty: It was defined by Oliver (1997, p.392) as deeply held commitment to rebury or
repatronize a preferred product or service consistently in the future, thereby causing repetitive same-brand or same brand-set purchasing, despite situational influences and marketing efforts having the potential to cause switching behavior. Customer loyalty is thought to be the final goal that a firm apply relationship marketing tactics, by building long-term mutual relationship with customers..

Theoritical Framework:

Research questions Companies have implemented various relationship marketing tactics into practice. However, some of those tactics did not work effectively, and there are phenomena showing that switching behavior frequently occur among most of targeted customers. Accordingly, our research questions are brought forward as follows:

(1) What kinds of relationship marketing tactics in practice positively contribute to customer loyalty? (2) How do different relationship marketing tactics impact on customer loyalty? (3) Is the analytical model showed as figure 1.1 proved to be correct?

Research Design:
This study will use a mixed methods design, which is a procedure for collecting, analyzing and mixing both quantitative and qualitative data at some stage of the research process within a single study, to understand a research problem more completely. The rationale for mixing is that neither quantitative nor qualitative methods are sufficient by themselves to capture the trends and details of the situation, such as a complex issue of doctoral students persistence in the distributed learning environment. When used in combination, quantitative and qualitative methods complement each other and allow for more complete analysis In quantitative research, an investigator relies on numerical data. He uses postpositivist claims for developing knowledge, such as cause and effect thinking, reduction to specific variables, hypotheses and questions, use of measurement and observation, and the test of theories. A researcher isolates variables and causally relates them to determine the magnitude and frequency of relationships. In addition, a researcher himself/herself determines which variables to investigate and chooses instruments, which will yield highly reliable and valid scores. Alternatively, qualitative research is an inquiry process of understanding where the researcher develops a complex, holistic picture, analyzes words, reports detailed views of informants, and conducts the study in a natural setting. In this approach, the researcher makes knowledge claims based on the constructivist or advocacy/participatory perspectives. In qualitative research, data is collected from those immersed in everyday life of the setting in which the study is framed. Data analysis is based on the values that these participants perceive for their world. Ultimately, it produces an understanding of the problem based on multiple contextual factors. In a mixed methods approach, the researchers build the knowledge on pragmatic grounds asserting truth is what works. They choose approaches, as well as variables and units of analysis, which are most appropriate for finding an answer to their research question. A major tenet of pragmatism is that quantitative and qualitative methods are compatible. Thus, both numerical and text data, collected sequentially or concurrently, can help better understand the research problem.

References:
Achrol, R. (1991, Oct) Evolution of the Marketing Organization: New Forms for Turbulent Environments. Journal of Marketing, pp. 77-93. Anderson, E., Fornell, C. & Lehmann, D. (1994 July) Customer Satisfaction, Market Share, and Profitability, Journal of Marketing, pp. 53-66. Arnold, M. & Reynolds, K. (2003) Hedonic Shopping Motivations. Journal of Retailing, pp. 77-95. Bickert, J. (1992, May) The Database Revolution. Target Marketing, pp. 14-18.

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