For instance, price competition, the pressures brought about by price increases, changes in customer trends and preferences, and industry concentration. These factors have made it extremely challenging for supermarkets to keep their customers, let alone encouraging them to be loyal. As a result of these changes, there are a number of ways through which retailers respond. Tesco, in particular, has always been a leader in influencing the market, and retaining customers, largely due to their technology driven strategies, that focus on marketing the products and services with the help of technology. In addition, the company also emphasizes on establishing and developing relationships with their customers. On the other hand, other companies like Asda and Safeway have decided to take another path, focusing on offering goods and services at a more competitive price. Sainsbury, at the moment, is still trying to gain back the market share of what Tesco has taken from them (Obitz, 2009).
This chapter shall focus on the concept of relationship marketing and customer relationship marketing, both of which aim to preserve the loyalty of existing customers, instead of simply aiming to gain new ones. In order for this to happen, companies need to be innovative in its marketing approach, and this study shall investigate the approach of supermarket retailers such as Tesco, which has opted to make use of the Internet as part of its marketing strategy. The following sections shall therefore discuss the integration of technology with customer relationship marketing and relationships marketing (both of which are two different concepts, as will be discussed later on).
As was described in the previous paragraph, the leading supermarket retailers all have their own unique marketing approach, especially when it comes to the kind of relationship that they are able to establish with their customers. Apparently, there are two types of marketing