Relationship marketing and network economy. Relationship Marketing and Transactional Marketing Nikolay Titov

Relationship marketing creates an increased level of social interaction between seller and buyer

The better the business network, the more competitive you can be.

The organization of transactions in the network business develops on the basis of divergence and is determined by its own expectations.

The purpose of the study is to analyze the points of contact between relationship marketing (partnerships) and the network economy, which is due to radical changes in the internal and external mechanisms and priorities of corporations due to new technology and its capabilities. For over 40 years, marketing has dominated the marketing mix ("4 P's"), becoming the paradigm of management.

Today, this paradigm is beginning to lose ground. Globalization, electronic communication and information systems have changed the way we look at partners and customers. The new paradigm is relationship marketing, which is based on developing and maintaining long-term, reliable relationships with individual customers, suppliers, employees and other partners. Such a strategy is aimed at retaining customers, which costs much less than acquiring them.

Internet and marketing

The influence of the Internet on the field of corporate marketing is obvious. External information is actively used in internal processes.

Among the adopted corporate strategies there is no marketing integrated into the Internet. According to a study prepared by Carnation Consulting in 2000, 64% of national companies have an information science based strategy, but only 7% have some kind of Internet strategy. If the loss of the consumer is explained by the low level of services (68%) and dissatisfaction with the product (14%), then it is understandable why the Internet is becoming one of the most important factors of competitiveness.

According to e-business experts, the number of printed documents for 1995 - 2005. will decrease from 90 to 30%, while their volume will double. The spread of the Internet varies from country to country and essentially depends on infrastructure and culture. Therefore, the key competitive advantage today is the routine use of information technology. Network communication is not always a matter of money. Another thing is the type and time synchronization of communication depending on the business relationship and the ability to innovate.

Business network and relationship marketing

Internet technology is used in business networks that serve relationship marketing. The concept of the latter, as opposed to the transaction-based approach (the "4P" complex), emphasizes customer orientation.

Transactional marketing involves exchange transactions between buyers and sellers and is characterized by limited communication and weak ties between the parties. Its main goal is to entice the buyer with a low price, packaging, promotion, or convenience that accompanies the purchase. Many organizations, however, are trying new approaches to building long-term customer relationships.

Transactional marketing involves a buyer-seller relationship that can deteriorate due to weak social ties. Relationship marketing, in contrast, creates an increased level of social interaction between seller and buyer. It goes beyond the obvious commitments buyers expect (Table 1).

Many companies reach out to potential customers through external marketing, which includes advertising and sales promotion. External marketing involves unconditional obedience to internal guidelines, for example, the need to improve the financial stability of the company so that it is beneficial to both employees and consumers.

Relationship marketing has a three-level structure (Table 2) and four dimensions - long-term obligations (guarantees), responsiveness, reciprocity, trust.

Commitments: two or more parties must guarantee each other the development of long-term contacts, mutual interests must coincide.

Responsiveness: the ability to see the situation from the outside.

Reciprocity: any long-term relationship between the parties involves some part of the concessions, favor to others in exchange for the same location.

Confidence: reflects the degree of confidence of one party in the honesty and decency of the other; is ultimately the bonding element in a relationship for years to come.

One of the key issues is the evaluation of relationships. Marketing and communication investments can be considered as capital investments. The cost of attracting a new customer is 5 times higher than the cost of retaining an existing one. If customer attrition is reduced by 25%, corporate profits could be increased by 25-85%.

Table 1
Comparison of Marketing Strategies

Segmentation and positioning of the company helps marketing database. Its creation requires the use of computers to classify the information of a huge number of buyers, to identify certain groups of potential customers, to fine-tune this highly effective marketing tool. The database allows the company to select the best buyers, calculate the value of the business life cycle; indicate the subject of dialogue with the customer in order to ensure his loyalty.

In addition, the database helps to focus efforts on the most promising customers by measuring the number of products they purchase and the profitability of sales. Each customer is unique with their individual priorities in terms of price, services provided, product quality, etc. Information from the database, even about the best customer, can develop and improve forms of service.

The Internet allows for instant customer feedback, and companies don't have to wait weeks or months to analyze the response. The high speed of data processing enables market entities to quickly adapt to changes in the market.

The development of relationship marketing as a system includes three main areas:

• development of a database to identify the qualities of consumers;
• analysis of specific signals from the consumer;
• program monitoring.

Well put system of marketing of relations is presented on fig. 1.

With the help of monitoring, the costs of attracting new consumers and the profit that pays for these costs can be calculated. Often, after-sales service (service) of the goods brings added value. Therefore, stable buyer-seller relationships are a critical component of the system. business-to-business(or industrial marketing).

The main motive of such a business is to reduce risk and increase profits. These factors form the basis of relationship marketing by bringing together two or more companies willing to help each other achieve common goals. You need to be an effective co-operator to compete successfully in today's global business markets.

There are four main types of partnerships in the industrial market - with the buyer, the seller, internal and related. New partnership ideas are also emerging, such as co-marketing and co-branding. Co-marketing is the formal connection of the business marketing of a joint (two or more companies) product. Co-branding is a relationship between two or more companies sharing their own brand names on the same product. Today, these ideas are becoming especially popular, as market entities have the opportunity to increase their profits.

table 2
The Three Levels of Relationship Marketing

Network economy and competitiveness

Long-term relationships are a decisive factor in competitiveness, and consumers become the corporate dimension of "value for money". The elements of competitiveness are realized through long-term marketing networks and relationship marketing, while the current concept of competitiveness is product or company focused.

Market entities can gain a competitive advantage by forming a supply chain (also called a value chain). Thoughtful management of such a chain, complete coordination of actions of suppliers involved in the creation and sale of goods or services, ensures well-established interaction between enterprises. This process of interaction affects relationships both upwards - between the company and its suppliers, and downwards - with end customers. Effective supply chain management allows you to maintain a competitive advantage in business if you increase the innovative contribution, reduce prices, take measures to eliminate contradictions within the chain and improve connections between its links.

A deeper understanding of marketing can be facilitated by identifying some of the key positions suggested by the new economy. Traditionally, the market was a place where buyers and sellers gathered to exchange goods. Economists now describe a market as a group of buyers and sellers who exchange a particular product or class of products (such as household goods or grain).

Sellers and buyers are involved in four streams (Fig. 2). Sellers send goods, services and communications (advertising, mailing lists, etc.) to the market; money and information are returned to them (position on the market, selling date, etc.). Internal flows show the exchange of money for goods and services; external - information.

Today, the market as a place and the market as a space are significantly different. A market place can be compared to a shop; the marketplace is a virtual exchange of value on a website.

The modern economy is replete with markets. Producers are looking for resources (raw materials, labor and money) to buy and turn into goods and services, then sell them to consumers. Consumers sell their labor and receive cash income, from which they pay for goods and services. The government collects tax revenue to buy resources; producers and market intermediaries use these goods and services to satisfy social needs. Both national and global economies contain a complex of interacting networks of markets connected by exchange processes (Fig. 3).

Rice. 2. Simple marketing system; Rice. 3. The structure of exchange flows in the modern economy

This new technology formed the basis of the network economy as e-commerce. Its benefits for the consumer and business are determined by:

ease of use(cyber store never closes);

cost savings(Businesses may be in direct contact with suppliers, factories, distributors, and customers, and customers may surf the Web site looking for the lowest prices. The ability to choose is also an advantage of blurring geographical boundaries when all markets in the world are open to a company) ;

personalization(sellers can target sales, sales batches according to buyers' requirements);

information(Each time a consumer receives a message on a website, it makes valuable market insights available to the company.)

Today we are talking about business networks as the ultimate goal of relationship marketing, the achievement of which lies at the heart of a company's unique assets. The marketing network brings together companies and supporting groups (consumers, employees, suppliers, distributors, retailers, advertising agencies, university scientists, etc.) with whom mutually beneficial business relationships can be established. Ultimately, the better the business network, the more competitive you can be.

Market entities use three marketing channels: communicative(dialog type e-mail and monologue type advertisements), distribution or distribution(physical movement of goods) and sales(for transactions with potential buyers).

Channels "raw materials - components of the final product" with access to buyers are described as a supply chain, which is a value delivery system. Each company has a certain percentage of the total value generated by the supply chain. All current and potential partners offering substitutes for goods are drawn into competition trademarks(offering similar products and services to the same consumers); branch(companies produce the same products or class of products); formal(the company produces goods for the same service industry); general(companies compete for the same consumer money).

On fig. Figure 4 shows a general scheme of value creation - nine processes, of which five are the main ones (internal logistics, current operations, external logistics, branding and sales, service) and four auxiliary ones (logistics, technology development, human resource management and infrastructure).

Companies need to provide competitive advantages beyond their activities in the value chain by suppliers, distributors, consumers. Most companies are already working with selected suppliers and distributors to form the perfect value shipping system or supply chain network.

There is another aspect of relationship marketing explored by Morgan and Hunt. Their model characterizes new functions, the relationship of companies with the environment. On fig. Figure 5 shows 10 discrete forms and types of relationship marketing. Among them, first of all, partnerships with suppliers (of goods and services) should be singled out, although the accompanying useful contacts (for example, with non-profit and government organizations) cannot be avoided. The third direction is represented by consumers, but the author would like to emphasize that the buyer, as the most important goal of the business, should be at the end of the chain, after internal partnerships, which should be regulated by the business process.

Rice. 4. General view of the value chain;

Rice. 5. Relative Changes in Relationship Marketing

The theory of key mediated variables considers part of the relationship of trust and commitment (Fig. 6). These relationships are assumed to underlie contracts and are determined by the indirect advantage of five important initial elements (for example, final costs, privileges, price distribution, communications, and selfish behavior) and five at the output (informal agreement, propensity to leave the business, cooperation, functional inconsistency of duties and doubts about the correctness of decision-making).

Business Network Economy Factors

Like the already well-known marketing approach, the model proposed by the author also includes four elements - "4I" (interest, investment, innovation, integration - interest, investment, innovation, integration). These elements are the essence of the development of network relations between the company and management. Interest expresses the ability of a corporation to operate on the Internet. Investments imply financial source and willingness to invest. Integration emphasizes the characteristics of the company, suggesting the unification and sovereignty of the participants in cooperation.

Rice. 6. Model of mediated variables in relationship marketing;

Rice. 7. External business network model

On fig. 7, the factors of the "4I" model can be considered as dependent variables of the internal properties of other elements (mainly environmental agents) in the same way as independent variables. It is possible to consider the entire network as a complex and multiplier form of development of the most convenient cooperation for a given company in the new economy. The possibilities of network relations perform the functions of a target market in which its subjects achieve their main goals.

The independent variables indicate the importance knowledge communication(this cannot be some kind of super-phenomenon, since effective relations with potential partners can only be developed on this basis), the application advanced technologies(an integral attribute of operations, including technical ones), economic and legal environment(providing basic conditions for market participants and supporting or limiting business performance and risks), society and culture(as well as other factors are a fundamental requirement for the long-term possibilities of networking).

There are several new forms of influence on marketing directions. Recently there have been:

• knowledge;
• aggregation, convergence and consolidation of industries;
• fragmented and overlapping markets;
• demand and possible behavior of consumers;
• adaptability.

Network organizations must be differentiated according to another important approach. Internal and external networks are already known. Internals are built to help companies open up their external environment, maximizing vertical synergy; external ones are designed to exploit the synergy of the Internet market; business networks designed to optimize the consumer experience is another aspect of what needs to be emphasized. The structure of business networks depends on the main goals, and the organization of transactions in network business and consumer networks develops on the basis of divergence and is determined by its own expectations.

Footnotes

The article was published in the journal of the Budapest University of Economic Sciences and Public Administration “Society and Economy in Central and Eastern Europe”, 2001/2.
1 This refers to the marketing complex “4P” – product, price, place, promotion (product, price, place, promotion). Note. ed.
2 Business-to-business is a market sector focused on organizing work with contractors and partners in the process of production and sale of goods or services. This sector includes all trade relations between different firms, organization of supplies, sales, coordination of contracts and plans.

Traditional transactional marketing (TM) has tended to ignore the existence and building of relationships. The company was seen as an independent agency constantly maneuvering to guarantee the best working conditions for itself. The company was willing to switch from one supplier or distributor to another if it could

The transition to relationship marketing does not mean that a company is moving away from transactional marketing altogether. Most companies need to use a combination of transactional marketing and relationship marketing. Companies that trade in large consumer markets are more likely to use transactional marketing, while companies with fewer customers are more likely to use relationship marketing.

So, we found out the nature of transactional marketing. But transactional marketing is an integral part of a broader concept called (relationship marketing, relationship marketing). Partnership marketing is the practice of building long-term mutually beneficial relationships with a company's key market partners (customers, suppliers, distributors) in order to establish long-term privileged relationships. , dealers and suppliers. A high level of service and reasonable prices are used as a building material. Partnership marketing is aimed at establishing close economic, technical and social ties with partners, allowing to reduce transaction costs and save time, which turns trade deals from a subject of negotiations into a routine process.

Nowadays, an increasing number of companies are moving from transactional marketing to affiliate marketing. Modern consumers are large enterprises that usually supply a significant part of the production to the world market. They prefer suppliers who supply and deliver a consistent range of products, service their products across geographies, resolve issues quickly, and work closely with the customer's team to improve products and increase production efficiency. Unfortunately, many modern companies do not meet the requirements of the time (sales of goods are

Empirical indicators should be used to calculate transaction costs arising both at the stage of formation and at the stage of functioning of the firm. These include the costs of working out the organizational project of the company, its coordination with experts; the costs of deploying a communication system; the planned cost savings due to the centralization of certain tasks - marketing, consulting; products.

In a bureaucratic manner, marketing responsibilities are carried out within a structure that is either a functional marketing department or a sales-oriented department. The organic structure emphasizes decentralization and high market uncertainty, leading to product or market specialization. The transactional form is a distribution of marketing tasks when relationships with external suppliers are established using centralized or formal structures, such as a procurement logistics service department. The relationship structure is associated with a situation of uncertainty when a one-time contract or Transaction form is replaced by a long-term relationship with an external supplier. Such an analysis of primary forms, based on partnerships, is associated with the development of new organizational forms of marketing.

The marketing management model is production-oriented because of its concern with what marketers do for consumers. Its expressiveness is mainly short-term and transactional. In addition, it concerns primarily the production and marketing of consumer goods, which represent only a fraction of all commercial exchange processes.

Service marketing. Handbook of a Russian marketer practice Anna Razumovskaya

4.2. Service: marketing mix

4.2. Service: marketing mix

As noted earlier, the essence of marketing comes down to achieving harmony between the expectations and needs of one party and the product offered by the other party. The question is what should be the product to be in demand in the market.

In Chapter 2, we paid a lot of attention to the issues of customer segmentation and the creation of a control loop according to segmentation criteria. This chapter is devoted to product topics, and we have already decided on a general idea of ​​\u200b\u200bthe service product. Now it is necessary to tailor the offer (see Figure 2.2) to the selected target consumer segment in order to ensure that the proposed product best suits the needs of the representatives of the segment of interest to us. This approach is called "customer focus" in marketing. It is typical for the so-called "relationship marketing", specific to the service sector, to which most services are still closer than to the product.

Consider the main differences between transactional marketing (“single purchase marketing”) and relationship marketing (Table 4.3).

Table 4.3

Transactional Marketing Versus Relationship Marketing

Quality is a necessary component of the marketing mix, the concern of all structures of the selling company (manufacturer)

Quality - requirements for the activities of the production unit

Comparing the data in Table 4.3 with the “service” product, we will see that transactional marketing is not only inapplicable to this area, but comes into conflict with the very essence of the product. Thus, "customer orientation" is the basic concept of marketing activities in the service market.

It should be borne in mind that in its activities a service company does not necessarily limit itself to this kind of framework. Its goals, and hence the chosen concepts, may be different at different points in time, depending on the strategies and tactics of market behavior determined by the market entity. Let us give for reference alternative approaches (both acceptable - working, and dangerous for successful activity).

Product Orientation is an undesirable concept. It is characterized by the confidence of the manufacturer (seller) that he knows “better” what the consumer needs. A good way to miss the market. The concept is typical for companies that have successfully worked and achieved success in the past - "resting on their laurels". There are many examples of generating unclaimed services on the market, followed by long and expensive attempts to sell them. Often found in the field of medical and paramedical services, cellular services, education.

Technology Oriented- an acceptable working concept, the essence of which is to stay ahead of the requirements of consumers in the field of technical capabilities. Generally applicable in the field of high technology. Unfortunately, not all companies are capable of applying it correctly. A sad example is today's mobile phones, stuffed with hundreds of unclaimed features for which consumers are less willing to pay.

Focus on financial (or any other internal) indicators- an acceptable concept, the essence of which is the prevalence (at the moment) of the importance of profitability over the interests of consumers. Applicable when understanding the essence of the process. Mistakes in the application of the approach are extremely costly for companies, since the need to increase profitability is usually dictated by the need to invest in their own development or in solving current problems. It is not uncommon for a company that has invested in a new line of business or product to be surprised to find that no one wants what they have done. And the money has been spent. This is how they go bankrupt. Manufacturer Orientation is an acceptable and even useful concept. It is focused on personnel, which in the field of services constitutes the main capital of the company. It is important to manage the process intelligently and understand the limits of tolerance zones in relationships with employees. Of course, kinks are possible here as well.

Focus on specialists- a concept inherent in the market of highly professional (medical, financial, legal) services. Specialists (doctors, financiers, lawyers) no doubt know better what is necessary for everyone's happiness. Alas, in commercial relations with consumers, the principle of voluntariness is basic. You cannot force yourself to be healthy, rich and happy for money. Hence the presence on the market of a range of services that is not relevant for the target segments. It is also good if the provision of such services does not require the company to purchase expensive equipment or technologies. The concept is viable and may even be useful in addition to the concept of customer orientation. Orientation to managers- orientation of management personnel to the latest achievements in the field of management. Attempts to completely and immediately introduce everything new in this area should still be consistent with the needs of consumers and common sense. Everything is good in moderation: not the satisfaction of needs to enable the realization of managerial potential, but professional management in the service of consumers.

Focus on sales volumes- momentary sales volumes are not an end in itself for any company's long-term development plans. If you need it now, you can use this approach. Again, a sense of proportion and understanding of the mechanism of what is happening is important.

Thus, a reasonable combination of approaches brings success to companies. Reckless steps and short-sightedness lead to bankruptcy. Unfortunately, these common truths have not yet become the alpha and omega of management in Russia.

So, having adopted consumer orientation as the basic concept of the company's activities, we are faced with a certain contradiction:

On the one hand, the more fully the needs of the target segment are satisfied by the proposed product, the more successful the existence of the product on the market will be;

On the other hand, complete consumer satisfaction occurs in the case of the implementation of the simplest principle "the best and free" that is in conflict with the interests of the company (seller and manufacturer).

In fact, we have before us two points of view, at first glance, it is difficult to reconcile with each other. However, as always in such cases, there is a compromise. Looking around, we will see that the market was, is and most likely will be. Consumers consume and pay, companies produce, sell and profit.

What's the matter? To explain this phenomenon, let's turn to the concept of customer satisfaction, its components and levels of acceptability. Consider the sources that form the satisfaction and compliance with consumer expectations on the Barry model proposed in 1985 (Fig. 4.4).

Thus, we see that the expectations of the consumer, formed by his reference sources, previous experience, communications, his own needs, with which he enters into a transaction, are a kind of comparison standard with which to work. The importance rating of the components that it includes in the matching process is determined individually, but, as a rule, has some common features that are characteristic of the segment as a whole.

The results of the evaluation (see Figure 4.4) can lead to three choices about the quality of what the consumer received, from which follows satisfaction or dissatisfaction with the transaction.

Rice. 4.4. Sources of customer satisfaction

Unacceptable quality resulting from the gap between expectations and real experience, as a rule, leads the consumer to the decision to terminate further relationships and perceive the marketing mix as transactional. For the service industry, this is highly undesirable.

Satisfactory quality - a consequence of justified expectations - contributes to customer satisfaction, but is dangerous for the supplier (seller / manufacturer) of the product due to competition in the market.

Ideal quality, due to exceeding expectations, protects the manufacturer from competition, but creates another danger - the level of consumer expectations is modified, enriching his experience and increasing requirements.

For a better understanding of the mechanisms of building relationships with the consumer, it is worth considering another important aspect of perception proposed by Parasuraman. There are two levels of consumer expectations:

Acceptable quality of the product (the consumer considers this level to be acceptable);

The desired quality of the product (the consumer hopes to get this level).

Between them is "zone of tolerance" -"zone of permissible deviations", for lower limit which the consumer stops consumption, considering the product unacceptable for himself in terms of quality, and for upper limit - loses the idea of ​​the value of an improved above conscious level of quality. Going beyond the upper bound is undesirable for the service provider, since such improvements require costs for which the consumer is not willing to pay, because he does not understand their value.

The zone of tolerance (tolerance) is a variable value, its boundaries are unsteady and can vary to a very significant extent depending on ridiculously insignificant circumstances. So, for example, a consumer's bad mood (not to mention well-being) can make a product unacceptable, which the same consumer would normally rate as exceeding expectations (Fig. 4.5).

So, we have considered the mechanisms for evaluating the product by the consumer. Now let's move on to considering the tools that will allow the company, that is, us, to create a product that a priori satisfies our consumer.

Rice. 4.5. Differences in tolerance zones for various factors

For this purpose, the so-called "marketing mix" or "marketing mix"(the concept was developed in the 60s of the XX century by Borden and McCarthy) - that is marketing mix, which ensures successful interaction between the consumer and the manufacturer/supplier/seller.

There are several models on the basis of which the product is customized for the consumer. The most common and applicable can be recognized with certainty:

4P: product (product)+ price (price)+ place/distribution (place/distribution)+ promotion (promotion);

7P: A more modern and improved 4P concept, complemented by people (people)+ processes (process)+ physical characteristics (physical evidence);

4C: evolved towards customer orientation 4P: customer needs and requests (customer needs and wants)+ costs for the consumer (cost)+ accessibility for the consumer (convenience)+ communications (communication).

The most "ancient" concept of 4Rs, criticized due to excessive focus on the organization itself, was subsequently improved. We'll take a look at its components to illustrate the simplest model that marketers have been building marketable products on for decades.

It is easy to understand that the concept under consideration is more applicable to tangible goods than to intangible services, but its merits to the market are so great that we will give it due respect and consider it in as much detail as possible.

Despite criticisms, the concept is still actively and quite successfully used today for express analysis and product adjustment to the consumer, taking into account the interests of the organization. The question rests on the level of professionalism of the one who conducts this analysis. Unfortunately, its apparent simplicity, as is often the case in marketing, gives the impression that almost anyone can perform it. Drawing the simplest analogies, for example, with the dental business, one can blasphemously declare that “pulling teeth” is also easy. But we still go to the dentist, and we prefer the dentist- surgeon and with experience, and in a good clinic, and on the recommendation of friends and acquaintances, and ... and so on.

And while marketing is played by everyone who is not too lazy, short-sightedly considering the higher education of marketers to be something very different in nature from the higher education of doctors, financiers or engineers. Sometimes it remains only to be surprised at the bizarre thinking! .. However, we are already used to this.

So, 4P (Table 4.4).

Table 4.4

Model 4P

A heated debate about the "looping" of the 4P concept on operations within the organization and its limitations in applying to the creation of a marketing mix for services has led to an expansion of the model with adaptation specifically for services. The 7P model included three more important components for an intangible service.

In the Russian service marketing literature, the three additional "Rs" have received little attention. However, according to the authors, this marketing model reflects the features of the service quite well and can serve as a basis for developing an extended marketing mix that includes the following main components. Without delving into the theory, we will consider the application of the 7P concept on the example of the provision of a universal service and comment on the applicability of the results obtained (Fig. 4.6).

Rice. 4.6. Advanced marketing mix for services

Product(product)- unfortunately, this component of the marketing mix has transferred all the negative features from the previous model (4P). However, this reflects the realities of Russian reality, since even marketing-oriented companies continue to be guided in creating and / or adapting a product either by their own experience or by focusing on the opinions of specialists. Minimization of this problem is possible with the joint use of the 7P and 4C models. This variable is controlled by adjusting the product to the needs, requirements, and expectations of consumers. It is desirable to find a balance between these two models.

Place(place)- accessibility of the service to the consumer. By this variable of the marketing mix, we mean the reachability of the place where the service can be received: how easy it is to get to it by public or private transport, or the probability of receiving the service directly at the place of residence (residence, work). Managing this variable involves putting in place the systems we discussed in Chapter 1 that allow network companies to reach their target segments in the most efficient way by properly locating branches and providing them with the necessary improvements (parking, signage).

Promotion(promotion)- this includes the entire set of activities to promote the service, including advertising, PR, personal selling, event-based events, etc. It should be borne in mind that if the product exists on its own, then the service does not exist without the subject that provides it. Therefore, in order to attract consumers, it is sometimes more important to indicate not the set of services itself, but those specialists (especially if they are well-known) who work in this company (very important in the field of design, medicine, entertainment, etc.). Demand management through promotion will be discussed in detail in subsequent chapters.

Price(price)- the level of prices for services in terms of the target audience. Pricing management is an extremely complex task, which, unfortunately, has not yet been systematically implemented in any Russian service company, even in Moscow and St. Petersburg, although work in this direction is being carried out in some places.

People(people)- the provision of services requires direct contact between the company's personnel and consumers. So, when visiting any representative office of a service company, the impression of the consumer from the process of receiving the service, as well as the degree of his satisfaction with the services provided and his desire to return to the company again is largely influenced by the courtesy, qualifications and readiness of the company's employees - from the security guard to the profile specialist - to provide they need help.

The first priority of the company's management is the careful selection and training (preferably with elements of coaching) of all personnel, as well as motivating people to do their job properly in accordance with company standards and strive to do everything to make consumers satisfied. This is all the more important, since, as a rule, management is not able to track how each individual employee follows the company's standards of communication with consumers. In such conditions, human resource management becomes a strategic task for the company. Its role is to create a consumer-oriented organizational culture. In this activity, the organization of work, systems for identifying and rewarding achievements, as well as handling consumer complaints, play an essential role.

Term "People" used in service marketing to refer to customer base management activities. So, since b2c services (medical, fitness, hairdressing, etc.) in most cases turn out to be in a clinic, salon or hall, other customers have a serious impact on consumer satisfaction. The disorderly flow of visitors, queues, rudely behaving customers (there are some) contrast with the image of an elite service company. Therefore, managers must pay special attention to who surrounds their customers and care about the homogeneity of the clientele in terms of social status, age group, typical behavior patterns, expectations from the service, etc. On the other hand, household services that are provided in the community consumer is an even more delicate issue, since company representatives, in order to perform their functions, are forced to invade the holy of holies - the home of the consumer. Accordingly, all consumer reactions in this case are aggravated, since when analyzing consumer behavior, one should never forget that a person, no matter how civilized he may be, does not cease to be a “slightly” animal, for whom the instinct to protect the home is one of the basic ones.

Marketers who shape services provided at the place of residence should take into account that consumer satisfaction can be fatally affected by the dirty shoes of a company representative or the ease with which he, without asking the owner for permission, flopped into her cat’s favorite chair ... We are not joking . There are many such examples.

In the area of ​​b2b, which somehow everyone forgets, despite the fact that just here services are an extremely common “thing”, the issue of personalities is even more important. There are a great many examples of the destruction of relations between companies due to the departure of an individual manager. The scale of the disaster associated (especially for large companies and complex services) with the transfer of cases from one specialist to another can often be overestimated! Nevertheless, the understanding of this problem is, as a rule, outside the area of ​​primary interests of managers. Moreover, this problem is not perceived as a problem! The authors repeatedly had to estimate the losses associated with such problems. Believe me, their amounts were very significant, which led the leaders to understand the importance of working with personnel in the field of services. Unfortunately, a general insight is not expected in the near future. Therefore, let's move on!

The physical environment of the service(physical evidence). This element of the extended marketing mix refers to the "materialization" of the service. The physical environment and other visual images perceived by the consumer have a strong influence on his impression of the quality of the service he receives and his assessment of the level of service. In practice, hours of operation, room design, seating comfort, background music, appearance, clothing, and even make-up of staff influence the perception of service quality. Auxiliary information materials (booklets, magazines, etc.) that describe the company and the service itself are tangible evidence of the company's professionalism. Commercial service companies should be especially careful when developing these materials, as they greatly influence the purchase decision.

Service delivery process(process). Since consumers are involved in the process of providing a service, the very implementation of this process plays a more important role in the service sector than in the field of material production. A person who wants, for example, to cure a tooth needs not only pain relief, but also the attention and care of doctors, the absence of pain during the treatment process, the quality of the materials and equipment used, the aesthetic result, the quality of the treatment and the guarantees that he receives ( a guarantee of free re-treatment in case of failure, a guarantee that his health will not be harmed). Therefore, when developing standards for the treatment process (the time allotted for one consumer, the norms for sterilizing instruments, the use of disposable instruments, certain drugs, modern filling materials, etc. - aspects that are important for specialized specialists), it is necessary to pay attention to how this process is perceived by consumers.

It is the perception of the process by consumers that leads us to the need to consider the 4C model as the most consumer-oriented.

Consumer needs and requests(customer needs and wants) All elements of a product or service. The product is designed in such a way that the final offer satisfies the consumer without creating a gap in expectations and without going beyond the tolerance zone as far as possible.

Consumer cost(cost)- conditionally, the costs for the consumer are considered in two projections: direct costs (financial or material) and indirect costs (time spent on the road, psychological costs, etc.). The importance of individual components of both direct and indirect costs varies significantly among different consumers.

Availability for the consumer(convenience)- distribution of the product and bringing it to the consumer includes such components as quality, ease of purchase, availability, reliability, the need to develop relationships with the supplier/seller/manufacturer, and much more.

Communications(communication)- in the 4C concept, both supplier-consumer communications and feedback are important. Communication is not limited to promotion, its boundaries are much wider.

Thus, in relation to services, the following algorithm for forming a marketing mix will be the most correct:

1) definition (and detailed description) of the components of the 4C model. As a rule, it is a two-stage process, including a study of the consumer environment and correction of the obtained data based on the results of feedback. The need for adjustment is dictated by practical experience, as well as the psychological characteristics of consumers, which should not be forgotten;

2) creation of the 7P complex, which ensures the possibility of the existence of 4C. In other words, the condition of the problem is formulated as follows: “It is required to determine at what 7R these 4Cs will be fulfilled?” In the answer to this question, the success of the service is hidden! Unfortunately, the simplicity of the question does not determine the simplicity of the answer. Next, we will try to offer you approaches that will allow you to create the “dream services” of your consumers.

1. The set of factors assessed by consumers as significant differs significantly among respondents who are at different stages of entering into a transaction to purchase a service. Yes, the factor "working hours" service company is an extremely important selection criterion at the stages of information gathering and decision making. According to this criterion, companies offering more favorable or better conditions can be rejected. But for a consumer who has already made his choice and started consuming the service, this factor magically loses its significance. Even a drastic change in working hours will not force him to look for a new service provider.

2. In the process of consumption, a set of factors undergoes a transformation: from those inherent mainly in the company to those inherent mainly in a specific specialist (person) who is involved in the provision of the service. Everything else is again relegated to the background. There are also funny examples of how consumption was initiated by completely extraneous factors (sympathy for the administrator girl, for example).

3. In the process of consumption, learning takes place, increasing consumer awareness in the field of a particular service. It is specific that the majority of consumers feel good in the role of a guru, advising their friends and acquaintances. Even if the process of this learning in a service company is a by-product (random) product (and it is desirable not to let this process take its course!), there is a pseudo-expert reassessment of significant factors. Moreover, the factors that are formed in the learning process are of great importance for the consumer, since he sincerely considers himself their author and therefore treats them with greater tenderness.

All these trends point to the need for a simple technique based on the division into a forward service and a service. Forward services (meaning not the service itself, but the way it is broadcast, its communication projection) are intended for potential consumers and are the subject of promotion, while the service itself (again, in the communication projection) may not have or have some of that a set of factors that is included in the forward service. The main thing is that both potential and actual consumers receive what satisfies them!

In conclusion of the consideration of the main conceptual models, I would like to note that no matter which model is chosen, it must be taken into account that each component of the marketing mix is ​​subject to consideration:

In the context of a certain exchange process;

Based on thorough knowledge of the consumer - a representative of the target (strategic) segment;

Taking into account the competencies, abilities, capabilities and current resources of the organization.

Chapter 15: Marketing Students who ask me how to get to a publisher, I in turn ask if they have already written a book. Very rarely the answer is yes. If you can't come up with an extremely compelling story or title that

Official Microsoft Skype-Connect Service Using the official Microsoft service (www.skype.com/en/features/skype-connect/) Skype-Connect allows you to remain confident that your connection will continue to work when your Skype network changes. To activate the service: register a Skype Business account connect

Bear service The primary source is the fable "The Hermit and the Bear" (1818) by I. A. Krylov (1769-1844). The fable tells how the Bear, wanting to serve his friend the Hermit (the hermit) and swat the fly that landed on his forehead, killed the Hermit himself along with it: Here is Mishenka, not

author Razumovskaya Anna

Chapter 4. Service as a market product How strange is what I'm up to: To create a semblance of love out of thirst And color it over time, so that one day I'll believe it myself... B. Grebenshchikov. Eagle, Taurus and Leo The basis of the commercial activity of any company is the target market,

From the book Service Marketing. Handbook of a Russian Marketer Practitioner author Razumovskaya Anna

From the book Organizing and doing business in the field of trade and services author Bashilov Boris Evgenievich

4.5. Product (service)… The information in this section is aimed at describing the types of goods or services that will be offered on the market. This section should provide a complete description of the product from "A" to "Z". All features of the proposed product or service, its

From the book Fundamentals of Competitiveness Management author Mazilkina Elena Ivanovna

11.5. Direct marketing The direct verbal appeal of the seller to the potential buyer chronologically preceded all other forms of commercial communication. In modern conditions, this type of formation of links with target audiences is defined as

author author unknown

1. MARKETING. SCIENCE AND PRACTICE Sufficiently large experience in the use of marketing in developed countries made it possible to systematize, generalize its provisions, derive certain patterns, which formed the basis of the concept of "marketing". As a result, marketing has

From the book Marketing: Cheat Sheet author author unknown

7. SCIENTIFIC AND TECHNICAL MARKETING This type of marketing is also called innovative. It has its advantages: know-how that provides a more or less sustainable and lasting competitive advantage; the attractiveness of everything advanced, novelties, whether it be a product or

From the book Marketing: Cheat Sheet author author unknown

10. MARKETING IN RUSSIAN PRACTICE A talented Russian intellectual is distinguished by a quick learner, so much that originated in the West has taken root in our soil. However, some marketing techniques simply do not fit our particular mentality and local

From the book Marketing: Cheat Sheet author author unknown

21. CONCENTRATED MARKETING This approach is especially attractive when the company's resources are limited. Here a narrow market niche is chosen, and then they try to expand it geographically. For example, it was first put on a production basis

author

From the book Thoughts, aphorisms, quotes. Business, career, management author Dushenko Konstantin Vasilievich

Marketing See also "Trade" (p. 183) In the market, any product competes with all the others. Ludwig von Mises (1881–1973), Austro-American economist The larger the market, the less space remains on it for products that "do not worse than others", and for the minimum effective

Traditional approach to marketing is based on a deal (transaction) between two parties. The ultimate goal of such marketing is to sell a product or service. The key concept of traditional marketing is the concept of "marketing mix" (or 4Ps: Product , Place , Promotion , Price).

The classic approach in marketing is based on the concept of a "seller", manipulating the ingredients or marketing variables: Product , Place , Promotion , Price , giving the consumer a passive role.

The transactional approach to marketing in modern conditions is not adequate for the following reasons:

1. This approach is product-oriented;

2. It assumes that the consumer is passive, i.e. the consumer is the one for whom something is being done;

3. It does not proceed from the interests of the consumer;

4. It does not involve interaction between the consumer and the supplier;

5. It comes from the assumption that the supplier is always right, i.e. it is a sales market.

Relationship Marketing is an approach based on long-term relationships between suppliers and customers and numerous contacts over a long period. aim This approach is the establishment, maintenance and development of relations between the two parties, as a result of which both achieve their goals.

This is ensured by mutual exchange and fulfillment of demands and promises. Relationship marketing considers the connection between the supplier and the consumer as a chain of various kinds of interactions associated with exchange and adaptation. The goal of relationship marketing is to turn potential customers into followers and partners, according to the "loyalty ladder".

Piercy sees the key to establishing relationship marketing as a shift in the focus of marketing activities from the marketing mix that provides one-time deals to managing the complex web of relationships that create value for the customer. These two types of marketing are contrasted in Table 5 below.

Table 5 12

Deal Marketing	Relationship Marketing
Focused on one-time sales	Focused on customer retention
Focus on product features	Customer Value Orientation
small time scales	Large time scales
Weak focus on customer service	Strong focus on customer service
Limited consumer loyalty	High customer loyalty
Moderate contact with consumers	Intensive contacts with consumers
Quality is a concern mainly for production and service departments	Quality is the concern of all departments

Building customer relationships and achieving customer loyalty requires an integrated approach that is built into the organizational business strategy. Thus, it proves to be more suitable for some types of business than for others. It is useful to consider a continuum of activities, with transactional marketing at one end and relationship marketing at the other. The relevance of relationship marketing increases with the increasing prevalence of the service component, and is also often practiced in relationships between organizations.

Comparison of transactional marketing and relationship marketing:

Table 6 13

	Transactional Marketing	Relationship Marketing
Time perspective	Short term	Long term
dominant function	Marketing mix	Interactive Marketing
Price elasticity	The consumer is very price sensitive	The consumer is less price sensitive
Basic interpretation of quality	Technical quality (result)	Functional quality (interaction)
Satisfaction scores	Indirect: tracking market share	Direct: customer database maintenance
Consumer information systems	Special Satisfaction Survey	Real time feedback
Functional Responsibility	Sales / marketing	Interaction marketing/operations/personnel
The Role of Internal Marketing	Little or no	Key to strategic success

In the literature, along with the concept of “relationship marketing”, there are such concepts as “relationship marketing”, “partnership marketing and interaction marketing”. From the author's point of view, these concepts are synonymous, however, it is more expedient to adhere to the concept of "relationship marketing" as the most accurately reflecting the essence of this concept.

Currently, there is no single approach to the definition of relationship marketing, as well as determining its place in modern marketing theory. The terminological analysis of the interpretations of "relationship marketing" made it possible to single out two main approaches to its understanding:

• - as an independent concept of marketing management, which is the result of the development of a general theory of marketing;
• - as a marketing tool, and in some cases, the emphasis is on its focus on retaining consumers, and in others - on creating new value for consumers. Each of the approaches was considered in detail by the author:
  • 1) Relationship marketing is the result of the ongoing development of marketing, the next stage after the concept of social and ethical marketing.

K. Grenroos believed that relationship marketing is the foundation, maintenance and strengthening of interaction with consumers and other partners on a mutually beneficial basis, so that the goals of the parties are achieved, which is ensured through the joint exchange of promises and their fulfillment.

From the perspective of Zeithaml and Bitner, relationship marketing is a business philosophy, a strategic orientation that focuses on retaining and "improving" current customers rather than attracting new ones.

K.L. Keller argued that relationship marketing is a concept and business strategy aimed at building a sustainable business, the core of which is a "customer-centric approach."

As evidence, these scientists cite the fact that the concept of relationship marketing differs significantly from the classical transactional concept of marketing: the latter is characterized by the priority of short- and medium-term economic interests and goals of the enterprise in relation to long-term ones; focus on one-time transactions and short-term relationships with consumers; focus on attracting new consumers by improving sales technologies, limited communications. Relationship marketing, on the contrary, is focused on achieving the strategic interests and goals of partner enterprises; retention of existing customers; development of long-term, value-added cooperative relationships; coordination of all business processes of the company with providing value for consumers (technology, management, communications, etc.); dialogue with consumers (see Table 1).

The difference between relationship marketing and transactional marketing

Table 1

Relationship marketing operates exclusively on the "segment of one" and, given the large number of customers of the company, involves "mass personalization", based not only on the production of products according to clear standards, but also on individual interaction with customers. As part of relationship marketing, mutually beneficial relationships are built not only with customers, but also with the company's marketing partners (suppliers, distributors / dealers, subcontractors, outsourcing organizations, financial organizations); company personnel.

Relationship marketing and transactional marketing use different tools. In transactional marketing, large-scale advertising campaigns, PR campaigns and sales promotions play an important role. Also, as a rule, price competition is used, based on price maneuvering in order to attract additional consumers. The characteristics of the product and the prestige of the manufacturer's firm retain consumers, but only until a competitor offers a product with similar characteristics at a lower price. At the same time, the specialists of the marketing department solve most of the marketing tasks.

In relationship marketing, customer-facing service personnel play a key role. Of course, traditional marketing tools are also used, such as direct mail advertising and personal selling, aimed at creating interest among potential buyers. When there is a close relationship between the seller and the buyer, not only the favorable price, but also the exchange of information, the joint development of the seller's new proposals and long-term contacts keep them together. The competitive advantage of the seller is based not on low price, but on decent product quality, excellent service and convenience in the process of receiving goods or services.

Transactional and relationship marketing can be all major promotional tools: advertising, public relations, direct marketing, sales promotion, personal selling. But within the framework of relationship marketing, it is most effective to use direct marketing, and in transactional marketing - advertising and sales promotion.

Due to the fact that the concept of relationship marketing does not have a universal character, the conditions for its application have been formed:

• - production and / or sale of products that involve a high involvement of the consumer in the process of making a purchase decision;
• - high value of consumers for the company in the long term;
• - high stability of the enterprise;
• - direct contact between the enterprise and the end user.

In the absence of these conditions, it is advisable to use the concept of transactional marketing. Each enterprise, after assessing the presence of these conditions, as well as after analyzing its strengths and weaknesses in comparison with competitors and the state of the market, must choose the concept of transactional marketing or relationship marketing, otherwise the limited resources of the enterprise will be unproductively used, and marketing costs will become unreasonably high.

2) Relationship marketing is a marketing tool aimed at retaining the consumer.

F. Kotler: "relationship marketing is the practice of building long-term mutually beneficial relationships with key partners interacting in the market: consumers, suppliers, distributors in order to establish long-term privileged relationships. A high level of service and reasonable prices are used as a "building material". It is aimed at establishing close economic, technical and social ties with partners that reduce transaction costs and save time, which turns transactions from a subject of negotiations into a routine process.The end result that relationship marketing strives for is the formation of a unique company asset called a marketing interaction system. the interaction system includes the company and all other groups of interest in its work: consumers, employees, suppliers, distributors, retailers, advertising agencies, university scientists and everyone with whom the company has established mutually beneficial business relationships. Thus, it is not so much the manufacturing companies that compete, but the systems of interaction as a whole."

From the point of view of J.-J. Lamblin, relationship marketing is focused on strong and long-term relationships. His top priority is to retain and grow his clientele so that the relationship that develops is mutually beneficial.

P. Doyle argues that relationship marketing is transactions that are constantly concluded between parties over a long period of time.

3) Relationship marketing is a marketing tool aimed at creating new value for customers.

J. Gordon believes that relationship marketing is a continuous process of defining and creating new values ​​together with individual buyers, and then jointly obtaining and distributing the benefits from this activity between the participants in the interaction.

According to leading branding specialists P. Temporal and M. Trott, relationship marketing is, first of all, creating a strong brand, and this is achieved through the right combination of organization, systems and processes, which allows employees to better understand individual buyers and, in principle, adjust the dialogue with each client to his specific needs. Having employees with detailed information about each customer also means that they have every chance to find additional business opportunities with existing customers and thus bring additional income to the company.

Along with relationship marketing, the following marketing tools are often used: direct marketing, database marketing, customer relationship management (CRM). There is no clear separation of these instruments. In addition, marketers are constantly expanding their boundaries, and they intersect more and more. Let's highlight the main features of database marketing, direct marketing, customer relationship management and relationship marketing.

Database marketing deals with the planning, building, maintenance, control and development of marketing databases. The database is an address database of enterprises, government and non-profit organizations, companies, other legal entities or individuals. The database records and analyzes information about customers, competitors, the market and the enterprise. This data allows you to select target groups of consumers for offers of goods (services) and promotions, to communicate and build relationships with them. Database marketing is the fundamental technical basis for direct marketing, CRM, and relationship marketing.

Direct marketing. Direct Marketing Association defines it as “an interactive system that uses one or more advertising mediums to generate a measurable response and/or close a deal from any customer.” to the database. In direct marketing, the distribution of information about a company and its services is carried out to completely unfamiliar consumers, in contrast to relationship marketing, in which information about a product and services is provided to those customers who want to receive it and have an idea about the activities of this company. Direct marketing is usually part of the tools of customer relationship management and relationship marketing concepts, but it only becomes effective when applied on a personal level, i.e. using information about the buyer and providing him with the necessary information.

Customer Relationship Management (CRM) is a business strategy for attracting and managing customers, aimed at optimizing their value in the long term. CRM implies the presence in the organization of a philosophy and culture focused on the client, aimed at the effectiveness of work in the field of marketing, sales and service. CRM applications make effective customer relationship management possible, provided the business has the right goals, strategy, and culture. All CRM business activities are aimed at building relationships with customers using information and communication technologies. The main provision of CRM is the principle of maintaining the loyalty of key consumers. From a conceptual point of view, CRM is based on direct marketing, from a technological point of view - database marketing.

Relationship marketing is based on building relationships not only with customers, but with all partners of the company. At the heart of building relationships with customers and partners is the consideration of their expectations and needs, the principles of mutual respect. Within relationship marketing, two-way or multi-way communication is possible.

The main differences between relationship marketing and other marketing tools can be revealed through three criteria (see Figure 1.1):

the purpose of interaction with consumers (attracting new or

retention of existing customers);

time orientation of the marketing strategy (short-term, long-term);

Building a communication process (one-way or two-way).

Rice. 1.1

The analysis of marketing tools in the proposed coordinate system allows us to conclude that the area of ​​primary application of relationship marketing is the retention of existing consumers; long-term marketing strategy; dialogue with the consumer.

The two considered approaches to understanding relationship marketing do not exclude, but complement each other. Thus, depending on the objectives of the research, relationship marketing can be considered both as a marketing management concept and as a marketing tool that ensures customer retention by creating new value for them.

Summarizing the above, we can give the following definition of relationship marketing:

Relationship marketing is the concept of marketing management based on building long-term, mutually beneficial relationships with key partners of the organization: customers, suppliers, distributors, personnel, etc. As an object of marketing management, he considers relationships (communications) with customers . At the same time, not only sales and marketing specialists should be guided by the management of interactions with customers, but also the entire staff of the company.

Relationship marketing provides the following benefits to a company. First, there is a reduction in costs, especially those associated with attracting customers. Secondly, the company gets an increase in the number and amount of purchases, since regular customers increase their expenses at an increasing rate and the resulting profit exceeds the discounts of this category of consumers. The loss of such a segment is the loss of high profits. Third, relationship marketing provides a key customer group that provides the company with a market to test and introduce new products or offerings with less risk, leading to less uncertainty for the company as a whole. Finally, the company acquires a barrier to entry of competitors by maintaining a stable customer base, and, in addition, a stable base of satisfied customers is the key to retaining the company's staff.

The consumer also receives a number of benefits through relationship marketing. On the one hand, close interaction with the company brings psychological benefits (the consumer communicates with regular employees, he does not have to get used to new people every time) and social benefits (establishment of friendly relations with staff). On the other hand, interaction with the company also provides economic benefits (getting discounts, prizes, etc.). And also, due to long-term cooperation, the service provider can adapt it to this specific consumer.

Relationship marketing has a three-level structure (see Table 2) and four dimensions:

• · obligations: two or more parties must guarantee each other the development of long-term contacts, mutual interests must coincide;
• Responsiveness: the ability to see the situation from the outside;
• Reciprocity: any long-term relationship between the parties involves some part of the concessions, favor to others in exchange for location;
• trust: reflects the degree of confidence of one party in the honesty and integrity of the other; is ultimately a bonding element in relationships for many years.

The central concept of relationship marketing is "relationship", which consists of a series of episodes of interaction between the consumer and the company, while the purchase of a service at least twice is a prerequisite for the emergence of a relationship. Those. Relationships take place when a series of interactions occurs between a consumer and a company. In addition, in order to start a relationship, it is necessary that both parties perceive the existence of such a relationship, or that the relationship is perceived as having some kind of “special status”.

Relationship Marketing Levels

table 2

The central concept of relationship marketing is "relationship", which consists of a series of episodes of interaction between the consumer and the company, while the purchase of a service at least twice is a prerequisite for the emergence of a relationship. Those. Relationships take place when a series of interactions occurs between a consumer and a company. In addition, in order to start a relationship, it is necessary that both parties perceive the existence of such a relationship, or that the relationship is perceived as having some kind of “special status”. Therefore, relationships exist when the consumer repeatedly interacts with the company, perceives the existence of these relationships, while both parties have obligations to each other, trust each other and are aimed at mutually beneficial cooperation.

Given the above, we conclude that the basis of relationship marketing is the management of a dynamic network of internal and external relations. The former include relationships in the organization, the latter - relationships with suppliers, stakeholders, the environment and even competitors (Fig. 1.2)

Rice. 1.2

As we can see, the interaction is not one-way. In the future, the scheme becomes more complicated. For example, banks begin to serve not only the organization, but also all participants in the system, from resource providers to consumers who receive loans. There are other connections as well. The result can be a system in which everyone is connected to everyone.

In addition to all of the above, relationship marketing is based on specific principles, which will be discussed in the next subsection.