Abstract

In today’s economic environment, in which companies permanently have to face new challenges, competition is increasing and the development of information technology is almost impossible to follow, it is vital for businesses to continuously meet customer needs. Over the past few decades marketing has been offering various tools for businesses to help them find good customers. At the end of the 1990’s a new kind of marketing approach evolved. McCarthy’s 4P model had offered appropriate tools in America in the 1950s and 60s. It helped to sell mass-produced goods when everyone mostly focused on conducting business transactions. Later, amid the strong competition for resources, information and costumers, high-quality products and services did not prove to be enough anymore. Instead, creativity, the hiring of the right employees, and the strengthening, development and maintenance of business relationships became increasingly important. Relationship marketing has offered the right tools for this. It has helped businesses get new customers and, what is perhaps more important, it has helped retain the existing ones. In order for relationship marketing and long-term relationships to become important, there was a need for B2B and service marketing tools. The development of B2B relations is researched by many scholars. Besides dealing with the stages of the lifecycle the aim of this study is to introduce client groups in Slovakia with the help of the factors that influence relationships on the advertising market the most. After joining an international research group, besides dealing with the above mentioned factors, in our primary research we set out to research Slovak client groups on the Slovak advertising market and to describe them on the basis of their behaviour on a special market, such as the advertising one. Our research focused on the Slovak advertising market, which is dominated by multinational advertising agencies and on the demand side mainly by small and medium-sized Slovak-owned businesses. In order to maintain cost-efficiency multinationals seek to use and work with standardized techniques that can be used in all countries, and they focus less on local market needs. Local market players, however, obviously are familiar with market conditions abroad to a lower extent. On the other hand, the partners can succeed only if their cooperation is based on jointly developed and marketed actions. This is the reason why we considered the identification of customer groups in the advertising market important. The more an agency is aware of the different needs of its client groups, the more it can make sure that initial short-term business relationships will evolve into long-term cooperation that will be beneficial for both parties. We suppose that clients can be segmented on the advertising market just like on every other market.  Thus, our hypothesis is the following: There are distinctive client groups in the early stage of the lifecycle model. In order to ensure comparability, in our survey we used a questionnaire that was already successfully tested in Hong Kong.  Our respondents were Slovakian advertising agencies and their clients. Our research results showed that the researched Slovak businesses can be put into two groups in the early stage of the business relations: the risk-averse segment and the risk taking segment. Our research also resulted in practical advice since it has been revealed that while advertising agencies emphasize the importance of interpersonal relationships during the establishment of relationships with their client, the determining factor for clients, at the same time, is the ability of the selected agency to survive. Thus, it can be stated that in order to retain customers, agencies should rather focus on offering flexible prices and on obtaining positive recommendations from their existing customers than on training their employees. In the maintenance of business relationships the parties must strive for the creation and preservation of loyalty: one of the ways to do this is the continuous monitoring and rethinking of creative content and knowing the market very well. At the same time, it would also be useful to conduct our research with the same research questions in other industries as well and to compare the results obtained with the results presented in this paper. It would be interesting to find out how the presence of mutual dependency between two parties overwrites the way how they establish and maintain business relationships.

Keywords: customer relations, lifecycle, advertising market, client groups, segmentation, Slovakia

JEL Classification: M31, M37, D21.

Cite as: Huszárik, E., Józsa L. & Hevesi, A. (2017). Client groups in the early stage of the lifecycle of business relationships on the advertising market. Marketing and Management of Innovations, 3, 23-32. https://doi.org/10.21272/mmi.2017.3-02

This work is licensed under a Creative Commons Attribution 4.0 International License

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