Online retailing One instance in which the commitment-trust theory has actually been applied includes that of the online retail industry (Hashim & Tan, 2015). Online retailing has been plagued by a trust issue, especially in developing countries in which online retailing is likely to flourish to a high degree. Trust is especially important in this environment, as consumers provide sensitive information in the form of both financial and personal information over the internet. Online retailers have attempted to respond to these concerns by encrypting financial data and being willing to reimburse consumers for orders that are not filled satisfactorily. Retailers have also used these features to create an emotional bond with the consumer that …show more content…
In fact, online retailing is uniquely positioned as an environment in which trust and commitment are paramount in order to conduct business, and this theory fits in perfectly in this business model. In this case, the application does not go beyond what the theory claims, and is instead being applied in an environment that is still in its infancy in developing trust and commitment from the consumer. The reason behind linking this theory with this application is definitely sound, as trust in this environment appears to be the only thing holding these retailers back in commanding a lion’s share of the retail …show more content…
Especially in the highly lucrative overseas marketplace, family retailers are the major source of revenue for organizations that invest in these countries. Commitment and trust are especially important in this environment for suppliers such as Proctor & Gamble, for example, which has made a strong commitment to the overseas marketplace (Smith et al., 2014). The reason that trust is so important in this environment is that retailers must purchase the goods not knowing, in some cases, what the level of demand will be for these items. These organizations place their trust in suppliers, such as Proctor & Gamble, that have done the research in these markets to determine the level of demand for products and brands for which consumers may initially not have a high level of experience or awareness with them (Smith et al., 2014). Family businesses have successfully formed an emotional commitment to organizations that provide new products to family businesses in developing markets (Smith et al., 2014). In fact, affective commitment is especially important to family retail businesses that rely heavily on suppliers to provide products that will create a higher quality of life for the consumer (Smith et al., 2014). Affective commitment, as explained above, is the emotional commitment that buyers make with suppliers at family-run retail
Characteristics of our society reflect in the outcome of purchasing tendencies. How many of us can honestly say we make a valid effort to purchase goods made in our own country? In our face paced world where both parents are in the work force, raising children, social activities and everything else, who has time to make an effort? Most often, consumers only care about marking off the s...
In contrast, B2C companies are product driven. These products have to be highly in demand to the consumer market, and in order to be successful these companies have to sell the product or service in high volumes to make a profit. Therefore, the relationship between the company and the consumer is not nearly as maintained as that of a B2B company. The value of this marketing strategy is the transaction- as many as possible to cover the costs and make a profit. In a similar fashion, however, there is also the value of trust, as a consumer that trusts the company or the brand will often assist the company in increasing transactions (Murphy, 2008).
“Before you can have an emotional connection with your customers, you have to have an emotional connection with your people.” (Ouchi A1).
Apple customers relate to the brand very intimately. Repeat purchases are very common. They feel a very strong attachment towards the brand because it portrays a very different image. It helps make them feel that they are flowing with the changing trends because they own an Apple product. Many Apple consumers sometimes consider their Apple product their favourite possession or say that they love the brand because they get very attached to it. Apple has portrayed itself to be a brand that the customer can have a happy and lifelong relation with. The Apple experience has created deeper attitudinal attachment in the minds of the customer.
One of the differentiation strategies used by BMW is the creation of auto products that consumers can emotionally relate to. In building the BMW brand, the company has succeeded in positioning its products as prestigious or luxurious. Therefore, most consumers want to own a BMW car solely for the prestige it gives them. BMW products are not only purchased due to their usability or functionality but for the status they give the owner. Subsequently, when a person buys a BMW product, they are emotionally attached not just to the car but to the brand as a whole. This has created increased brand loyalty in BMW growing its customer base as more people search for the status associated with the company’s products.
Gaining customers’ trust is important to the crucial of an organization’s success and to be successful salespeople must demonstrate the five trust building characteristics which includes; customer orientation, expertise, dependability, candor and compatibility. It is important to know that trust is a combination of these characteristics and measured on a continuum. A customer orientation refers to determining the buyer’s unique needs before recommending a purchase and placing as much emphasis on the customer’s interest as their own. Expertise refers to the ability, knowledge and resources to meet customer expectations.
Since the second half 20th century, technology has enabled marketers to have improved and more accurate ideas on how not only to measure its product or service’s success but to research into what is the most effective way to create a long lasting image, which can compel consumers to buy. For decades, marketers have heavily relied on traditional methods of research – surveys, experiments and focus groups. The results, even though it had discrepancies, were widely used to measure what consumers want and need, and to map out their attitudes. One of the issues found with the traditional methods was the belief that emotions were rarely detected by conventional research, and that has a deep influence on individual choices (McDowell and Dick, 2013). Making it clear that conventional research had to be combined with other tools to have a better understanding on how products, brands and services cause an impact in the consumers mind penetrating memories, emotions and positive experiences and transforming into customer loyalty.
Every company wants to understand why people decide to buy its products or others. Firstly, we have to understand why people buy certain kind of product. People buy products because they need them. A need is activated and felt when there is a sufficient discrepancy between a desired or preferred state of being and the actual state. (Engle£¬Blackwell and Miniard. 1995. p407 ) For example, when you feel hungry, what you needs is some food. It is very important for marketer to understand the needs of consumers. All the consumers may have the same needs, but the ways which they satisfy what they need are different. Here is a example, Chinese people would choose rice when they feel hungry, whilst British people may choose bread to satisfy their needs.
Trust is among the most frequently cited dimensions of C relationships in the literature and has been defined as “the firm’s belief that another company will perform actions that will result in positive actions for the firm, as well as not take unexpected actions that would resu...
Many companies cannot relate with all customers in diverse markets (Yudelson, 2006). But they can segregat...
The Information revolution is changing our daily lives. With the rapid development of computers and the internet, online commerce has become quite common and plays an important role in the modern world. Online business has been booming in recent years. US online retail sales rose an average of 11% in the first three months of 2009 (“US Online Sales Up,” 2009). The growth of online sales may be due to the growing number of consumers who shop online.
The accessibility of the product is important, so the product get to the customer in a timely manner. The placement of the product with retail partners, that have exposure to mass markets, is an essential element first step. Importantly, this may be difficult for a new player in the market unless they have a niche product, a lower price point or are already established in other markets. Retailers will normally have established agreements that make it difficult to take on new suppliers unless these circumstances present
The nature of the business of retailing puts retailers at a assumed risk of incurring costs because products are bought with the assumption that consumers will purchase. Additionally there are external factors that may also pose risks such as natural disasters, theft, spoilage and fire. In other circumstances retailers also extends financial credit to customers in the form of credit sales which facilitates the smooth transition from retailers to the marketplace. Retailers are in constant contact with customers which gives them the opportunity to research and study buyer’s behaviour. This involves collecting information about changes in customer preferences, perception and shifts in the demand curve. Through advertising within their stores retailers are able to exhibit and introduce existing and new products to the marketplace. Ultimately retailers are in the business of selling products to customers to achieve their goals of generating
In other words, their purchasing power is more focused on their need, health, and efficiency and cost effective. It is with this in mind, this writer would say that there lies a possibility for a company to cater to both its best interest and that of the consumer conjointly. Without customers, there would not be any company; therefore, a secure partnership between the company and customers would be more beneficial for both parties, in that the customers would be loyal to the company based on if they feel valued and if their needs are being met by the company. The company can foster this partnership by building a strong customer relationship management – where they have a customer-centric model in which they learn ways to enhance their product and service through feedback received from the customers. Here, both interests of the company and the customer will be
...enture into overseas market comes with expectations as well as uncertainties due to unfamiliarity. Charles and Keith, the fashion retailer, has to understand clearly that what appeals in one market might not be accepted in the others and this is almost the same for all industries. Thus, a thorough research on cultural background has to be done before entering an unfamiliar ground.