RELATIONSHIP MARKETING

Relationship Marketing

Relationship Marketing

Introduction

Relationship marketing has been described as a new-old concept, in that it is a new term for an ancient phenomenon, best summed up by the age-old Middle Eastern proverb, “As a merchant, you will do well if you have a friend in every town”. As a new-old concept relationship marketing is naturally of interest to both marketing practitioners and academics, with some of the latter group claiming it as a paradigm shift (Grönroos, 1994), while others question whether it is truly a paradigm shift or merely the Emperor's new clothes (Gummesson, 1996).

Under the latter interpretation, relationship marketing is presented as an add-on to mainstream marketing management with perhaps a slight shifting of emphasis; Gummesson (1994) likened this to the fisherman's relationship to the fish - the more sophisticated the equipment and techniques of relationships marketing becomes, the less likely that the fish (consumer) will get off the hook. Under this approach, the application of relationship marketing becomes a matter of better capture of customers, the more effective tethering of them and then dissuading them from defecting by the threat of corrective action. An approach such as this is more the Emperor's new clothes, than a paradigm shift from the traditional marketing mix approach associated with the Four Ps, a view developed by Barnes (1994) and Perrien et al. (1992), where they talk of “locking in” the customer.

Relationship marketing has also been described as a long-term life-supporting process, as opposed to the short-term manipulation of the traditional marking approach (Gummesson, 1994). Using an ecological analogy, Gummesson (1994) associates manipulative marketing with the use of artificial fertilisers and pesticides, to increase short-term harvests while simultaneously improvising the soil where the crops grow. By contrast, he considers relationship marketing akin to a self-sustaining chain of activities which can both help to improve the whole of nature and yet be beneficial to all parties in both the short and long term. Thus a definition of relationship marketing is that it focuses on what you can do for the customer, as opposed to the traditional marketing approach, which focuses on what you can do to the customer.

A more embracing definition of marketing from a relational perspective is “the process of identifying and establishing, maintaining, enhancing and when necessary terminating relationships with customers and other stakeholders, at a profit, so that the objectiveness of all parties involved are met, where this is done by a mutual giving and fulfilment of promises” (Grönroos, 1997). Another well-known definition by Gummesson (1995) states that relationship marketing is “marketing as seen as interactions, relationships and networks”. In order to be able to understand, analyse and plan the interaction process, it has to be divided into meaningful processes. Liljander and Strandvik (1995) studied the interaction process in terms of acts, episodes and relationships. Thus a meeting with a bank manager to discuss a loan is an episode, while an act would be a visit to a bank branch to seek information about loans and a relationship would commence ...