The Difference between Relationship Marketing & CRM

CRM activities such as automated record-keeping identify previous issues and potential new services as part of a relationship management strategy. As a small-business owner, you work hard to get new customers, and once they walk in the door, you should do everything you can to make sure they return. Relationship marketing and customer relationship management are two phrases you’ll come across as you search for ways to manage and increase your sales. Understanding how to use them can help you grow your business. Though they’re different, implementing both of these concepts can help you to establish mutually beneficial relationships with customers, which in turn leads to long-term repeat business.
Relationship Marketing Relationship marketing is a sales approach focusing on building a long-term relationship that benefits both the customer and the business. Some of the techniques businesses use in relationship marketing includes providing consistently excellent customer service, getting to know the individual and anticipating their future needs, and offering discounts and special perks through loyalty programs for repeat customers. The rise of the internet gives small businesses ample opportunity to build relationships and engage with customers by inviting them to visit their websites and comment on blogs, as well as interact on social media sites such as Facebook, Twitter, Pinterest, YouTube and LinkedIn.
CRM CRM is the acronym for customer relationship management, a phrase describing webbased computer systems or software that helps businesses organize and provide marketing, sales and customer service assistance. Data collected includes information about customers’ purchasing history, demographics, details of purchases and returns, and anything that will help salespeople assist the customer in future interactions. Much of this data must be entered by the sales team. CRM systems are also mined to identify new sales leads and potential new product or service areas.

Main Differences While relationship marketing is a sales and marketing concept, CRM refers to the tools used to carry out the concept. Relationship marketing is implemented as a strategy and includes activities such as identifying long-term sales and retention goals, public relations, marketing and advertising campaigns. CRM includes the operational tasks that support the relationship marketing strategy. Activities may include gathering data about the customers, then organizing and analysing it to create target customer profiles. CRM data is also effective in finding opportunities to create special offers to reward long-time customers for their loyalty, further building the relationship.
Using CRM and Relationship Marketing Relationship marketing seeks to increase sales by building trust and engaging customers. Using a CRM system effectively allows a salesperson to quickly and consistently deliver what customers are looking for with each and every interaction, because their preferences and buying history are recorded. The system benefits the customers, because they see the business “knows” them. CRM systems coordinate, automate and deliver online and offline advertising and marketing activities that help build the long-term customer relationships that are crucial to a successful relationship marketing strategy. Marketing research studies consumer behaviour and marketing environment. Since these factors keep on changing, it cannot give exact information. MR is also a social science. So, it cannot give exact solutions. It cannot be an alternative to decision making. In other words, it cannot replace decision making. It aids in decision-making. It can improve the quality of decisions. However, it cannot guarantee a 100% success. It can reduce the business risks. However, it cannot totally eliminate all these risks. The demerits or limitations of marketing research are depicted below. The limitations or disadvantages of marketing research are as follows:
Marketing research (MR) is a costly affair.
It is also lengthy and time-consuming.
It has a limited scope.
It has a limited practical value.
It can’t predict consumer behaviour.
It can’t give 100% accurate results.
It provides suggestions and not solutions.
Non-availability of qualified and experienced staff affects its quality.
It uses a fragmented approach.
It can be misused.
Non-availability of a reliable data affects it.
It is resistant to marketing managers.
Now let’s discuss above listed limitations of marketing research. (a) Costly: Marketing research is a costly affair. It needs a lot of money to conduct various market research activities. Huge funds are required to pay salaries, prepare questionnaires, conduct surveys, prepare reports, etc. It is not a viable choice for small businesses. It is suitable only to large companies who can afford its cost. (b) Time consuming: Marketing research is a lengthy and time-consuming process. This process involves many important steps. All these steps are

crucial and not even a single step can be neglected or avoided. In other words, there are no short-cuts in MR. Generally; it takes at least three to six months to solve a marketing problem. Therefore, it cannot be used in urgent or emergency situations. (c) Limited scope: Marketing research solves many business-related problems. However, it cannot solve all business problems. It cannot solve problems related to consumer behaviour, income and expenditure relationship, etc. Thus, its scope is limited. (d) Limited practical value: Marketing research is only an academic exercise. It is mainly based on a hypothetical approach. It gives theoretical solutions. It does not give realistic solutions to real-life problems. Its solutions look good on paper but are harder to implement in a real sense. Thus, it has a limited practical value. (e) Can’t predict consumer behaviour: Marketing research collects data about consumer behaviour. However, this data is not accurate because consumer behaviour cannot be predicted. It keeps on changing according to the time and moods of the consumers. Consumer behaviour is also very complex. It is influenced by social, religious, family, economic and other factors. It is very difficult to study these factors. (f) No accurate results: Marketing research is not a physical science like physics, chemistry, biology, etc. It is a social science. It studies consumer behaviour and marketing environment. These factors are very unpredictable. Therefore, it does not give accurate results. It gives results, but it cannot give 100% correct results. (g) Provides suggestions and not solutions: Marketing research provides data to the marketing manager. It guides and advises him. It also helps him to solve the marketing problems. However, it does not solve the marketing problem. The marketing manager solves the marketing problems. So, MR only provides suggestions. It does not provide solutions. (h) Non-availability of technical staff: Marketing research is done by researchers. The researchers must be highly qualified and experienced. They must also be hard-working, patient and honest. However, in India, it is very difficult to find good researchers. Generally, it is done by non-experienced and non-technical people. Therefore, MR becomes a costly, time-consuming and unreliable affair. So, its quality is also affected due to non-availability of technical staff. (i) Fragmented approach: Marketing research studies a problem only from a particular angle. It does not take an overall view into consideration. There are many causes for a marketing problem. It does not study all causes. It only studies one or two causes. For example, if there is a problem of falling sales. There are many causes for falling sales; like, poor quality, high-price, competition, recession, consumer resistance, etc. It will only study two causes viz.; low-quality and high price. It will not study other causes. So, it is not a reliable one. (j) Can be misused: Sometimes, marketing research is misused by the company. It is used to delay decisions. It is used to support the views of a particular individual. It is also used to grab power (managerial) in the company. (k) Non-availability of reliable data: The quality of the marketing research report depends on the quality of the collected data. If the data is complete, up-to-date and reliable, then the MR report will also be reliable. However, in India, it is very difficult to get full, latest and trustworthy data. So, non-availability of a reliable data is also its limitation.

(l) Resistance of marketing managers: The marketing managers do not use the suggestions given in the marketing research report. Primarily, they feel that these suggestions are not practical. Secondly, they also feel that their importance will become less if they use these suggestions. There is a conflict between the marketing managers and the researchers. Following image depicts the ten main points which are used to make a comparison or distinction between MIS and Marketing Research (MR). Difference between MIS vs MR is based on the following ten points:  Meaning of MIS and MR.  Their basic or main purpose.  Wide or narrow scope.  General or specific nature.  Number of reports provided.  Future or past orientation.  Frequency of data collection.  Number of problems to solve.  Continuous or non-continuous operational method.  Based on use of computers or not. Now let’s distinguish MIS and Marketing Research (MR) on above points. 1. Meaning: MIS means to collect, analyze and supply relevant marketing information to the marketing managers. The marketing managers use this information for taking effective marketing decisions. It is a permanent and continuous process. Marketing Research (MR) is a systematic process of collecting and analysing information to solve a specific marketing problem. 2. Purpose: The main purpose of MIS is to provide relevant information to marketing managers and enable them to make effective marketing decisions. However, the main purpose of Marketing Research (MR) is to solve a specific marketing problem. 3. Scope: The scope of MIS is wide. Marketing Research (MR) is one of its components. It is not only used to solve problems but also helps to prevent problems in the future. The scope of Marketing Research (MR) is narrow. It is one small part of MIS. It solves a specific present marketing problem. 4. Nature: MIS is more nonspecific or general in nature. It can solve many types of marketing problems. Marketing Research (MR) is more specific or particular in nature. At one time, it can only solve a single type of marketing problem. 5. Reports: MIS gives four types of reports namely, plan-reports, periodic-reports, triggered-reports and demand reports. Marketing Research (MR) provides only one report called as ‘MR Report.’ 6. Orientation: Orientation of MIS is more future-oriented when compared to MR. However; the orientation of Marketing Research (MR) is more past and present one when compared to MIS. It concentrates more on earlier and latest information. It uses this information to solve a current marketing problem. 7. Problems: MIS deals with and attempts to solve many different marketing problems at one time. For this, it collects stores, analyze and supply relevant market information to the marketing managers. Marketing Research (MR) only deals with a single marketing problem at one time. It doesn’t solve multiple marketing problems simultaneously. 8. Data: In MIS, the data is collected more frequently, usually almost daily. This is a must for every company. In Marketing Research (MR), the data is not collected as frequently as MIS. It is collected on a required basis.

9. Operation: MIS is a permanent and continuous system. Here, the inflow of market information never stops. Data is constantly collected and stored for further analysis. It is properly analysed, studied and well-organized before supplying to the marketing managers. MIS has a starting but no ending point. Marketing Research (MR) is not a continuous system. Here, data is collected only when a company faces a specific marketing problem. It has a starting and ending point. 10. Computers: MIS is heavily based on the use of computers. Here, computing technologies are widely used to ease and facilitate data collection, its storage, analysis, retrieval and supply of relevant information to marketing managers of the company. Unlike MIS, Marketing Research (MR) hardly makes use of computers. It uses computers only for analysing some information and is not entirely based on computing technologies.

Author: arunadevi

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