In search of marketing equilibrium: Relationship marketing versus hypercompetition

This paper is a discussion on work in progress concerning the development of relationship marketing (RM). It is particularly focused on the concept of marketing equilibrium which is a marketing management correspondence to market equilibrium, the traditional concept of neoclassical economics. The paper starts with a brief introduction to the author's approach to RM. It proceeds‐ with a summary of the concept of marketing equilibrium. The next section is a discourse on hypercompetition, a particularly intense type of competition that has been observed by several authors. RM offers a marketing theory based on collaboration with various stakeholders through long‐term relationships, customer retention and loyalty. In contrast, hypercompetition claims that customers will switch between suppliers at an increasingly faster rate and that competitors will become increasingly hostile to one another. Two basic questions are raised: do RM and hypercompetition represent two conflicting but coexisting trends that are both growing in intensity? and How can this coexistence or conflict be conceptually handled? The aim of this paper is not to be complete and provide an answer, only to draw the reader's attention to hypercompetition as an opposite trend to RM and to offer a platform for further analysis and constructive and reflective scholarly dialogue.     

Reconsidering the Relationship Analogy

Whilst many have grown weary of the claims of relationship marketing (RM) to represent a fundamental shift in marketing thought, critics remain focused upon its unfulfilled claims and, in particular, point to inconsistencies between theory and practice. Although these critiques have merit they tend to retain the assumption that the precepts of RM remain sound and that consequently the 'solution' remains attaining 'better' practice through a revaluation of and commitment to the fundamentals of relationship building. These principles involve the analogous borrowing of key notions of our lived relationships. In this paper we do not set out to dispose of the RM perspective. However we seek to examine how a more sophisticated treatment of the relationship concept in particular by reflecting ambiguities and power dynamics in the sources of the analogies, compels us to produce a re-presentation. Thus we retain the importance of 'relationships' but aim to provoke a more realistic, socially embedded characterisation of consumer engagement with marketing and marketers.     

Relationship Marketing: Theory and Implementation

The field of relationship marketing can be viewed as a sub-area of market focused management. In this issue, we present some cutting edge work on relationship marketing (RM). At the most simple level, RM strategy prescribes that it is more effective to invest in long-term customer interactions than to rely on a series of potentially unrelated, one-time exchanges. In practice, however, RM is not that simple to implement. There are multiple stakeholders to consider, and organizations must make certain that value is provided for all members of a potential partnership. Here, we consider several strands of relationship marketing, including the concepts of: customer relationship management, stakeholder theory, affinity marketing, promotional incentives, strategy, and leadership.     

Relationship formation and governance in consumer markets: Transactional analysis versus the behaviourist approach

Although relationship marketing (RM) is widely discussed in contemporary marketing literature, its theoretical foundations are rarely debated. Much published work on the subject relies implicitly on behaviourist exchange theory to support major propositions. Exchange theory neatly elucidates many RM hypotheses, but cannot explain the failure of campaigns that furnish customers with increasingly generous relationship rewards. Phenomenological approaches which explore the fundamental psychodynamics of supplier/customer relationships (especially the ways in which entities inwardly construct their own meanings for their experiences) represent a powerful alternative to the behaviourist model. A business, it is suggested, is like a person in that it possesses an ego, has a collective psyche, adopts specific ego states, and occupies a particular corporate life position which helps determine the nature of its relationships with its clientele. Core propositions of transactional analysis are commandeered to categorize managerial feelings towards customers. It is concluded that positive self‐regard, corporate openness and integrity, transparency of the corporate self, genuine liking for customers, and unadulterated confidence in the propriety of the company's mission are necessary prerequisites for successful RM. Also the firm has to view RM as an entire philosophy of marketing; not merely as a set of promotional practices and techniques.     

The 4Ps of Relational Marketing,Perspectives, Perceptions,Paradoxes and Paradigms

SUMMARY

The aim of this paper is to explore how different underlying worldviews in marketing affect the perception of the environment and how these impact the choice between transactional or relational offerings. Furthermore, we aim to show that not only positivistic and interpretivist paradigms are present in all of the management disciplines, in strategy, in organizational theory, in marketing, etc., but also that managerial disciplines seem to be moving from the reign of the positivistic schools, through the emergence of the interpretativist schools, and now towards a pluralistic approach. The analysis of the underlying worldviews is important for relationship marketing in practice because it may provide another, deeper-level explanation for the choices that managers make regarding transactional, relational and pluralistic offerings. At the theoretical level, it may help explain how and why the new RM paradigm developed in the marketing.     

Well-being Marketing: An Ethical Business Philosophy for Consumer Goods Firms

In this article we build on the program of research in well-being marketing by further conceptualizing and refining the conceptual domain of the concept of consumer well-being (CWB). We then argue that well-being marketing is a business philosophy grounded in business ethics. We show how this philosophy is an ethical extension of relationship marketing (stakeholder theory in business ethics) and is superior to transactional marketing (a business philosophy grounded in the principles of consumer sovereignty). Additionally, we argue that well-being marketing is based on duty ethics concepts, specifically the duty of beneficence and non-maleficence. Subsequently, we show how the well-being concept guides marketing decisions for consumer goods firms.     

Relational marketing: development,debates and directions

Abstract

Relationship marketing (RM) is an umbrella term for a loose collection of ideas and concepts that emerged in different empirical contexts from the late 1970s. Informed by diverse research traditions, it represented at one and the same time an extension of existing ideas within marketing management and a very different way of thinking about marketing. Though cooperation has not been a core element of the marketing management lexicon, debates about cooperation and competition predate the 1970s. Moreover, re-engaging with relational perspectives raises important questions about managerial autonomy and about the utility of the market as a regulating force. The paper calls for the development of a more realistic theory of networks with inputs from both business and consumer marketing contexts.     

The role of accounting information in revenue management

Revenue management (RM) uses differential pricing and other techniques to manage customer demand for a company's products and services. It judiciously trades off yield and spoilage, and brings rational approaches to pricing for goods and services with a limited shelf life. Because many types of businesses find that growing revenue has a disproportionate impact on operating profits, firms that know and manage their customer base often achieve better bottom-line results by growing revenue rather than by cost-cutting. Initially developed as a marketing tool for pricing airline tickets, today's numerous RM applications can benefit from accounting tools that help assess whether applications will enhance operating profit and monitor their success in doing so. Knowledge of a firm's cost structure, operating leverage in particular, and when to treat RM adjustments as special orders, are the principal accounting lynchpins. Opportunity cost variances and insights from the theory of constraints contribute to effective revenue management/profit enhancement programs. Use of proper accounting information and analytic techniques can help a tolerated union of necessity between RM programs and firm strategy become a desirable marriage of mutual choice.     

基于中国文化的关系营销研究

目前,关系营销(Relationship marketing,RM)已受到理论界和实业界的高度重视。但是,由于中国文化的独特性,把西方的关系营销直接搬到中国来是不合适的。所以,将西方的关系营销与中国的文化结合起来,搞清楚中西方关系营销的异同是非常重要的。     

Relationship marketing: Back to basics?

Relationship marketing, however defined, has received considerable attention recently. To its advocates, relational exchange between buyer and seller represents a paradigm shift away from the traditional focus on individual transactional exchanges. Critics of relationship marketing argue that the concept is poorly defined and is merely a new way of describing what businesses have been doing for a long time.

This paper recognizes that the need to develop long‐term relationships between an organization and its customers is becoming greater. It is however questioned whether marketing educators are providing students with the abilities to take a mature approach to relationship marketing issues, in line with the changing nature of employers' business. Suggestions for introducing relationship marketing to the undergraduate syllabus are made at a number of levels, from an additional module for an introductory “principles of marketing course” to a multi‐disciplinary degree majoring in relationship marketing.     

The Past,Present and Future of Relationship Marketing

In the light of the redefinition of 'marketing' by the AMA in service/relational terms, and a recent review of the current vector of research in marketing (Littler and Tynan 2005), it seems an appropriate time to provide a substantial review of the past, present and likely future of what has become known as Relationship Marketing, together with an extensive list of key RM literature. This paper will take a reader through the origin, development and current state of RM research, with notes on the future of the research and practice of RM. The paper concludes that RM is here to stay, whether or not it is recognised as the dominant logic/paradigm of marketing.     

The role of customer gratitude in relationship marketing: moderation and model validation

Relationship marketing (RM) theories often emphasize on the role of trust and commitment in affecting seller performance outcomes. We test a recently developed model in a field experiment that demonstrates that RM investments (RMI) generate feelings of gratitude depending on the different types of gratitude leveraging acts and affects purchase intentions. The results confirm the presence of previously untested relationship between trust and purchase intention. The existing model is extended by including the moderating effects of the nature of the medium of communication for the seller–customer interaction (i.e. face-to-face vs. telephonic communication), and the varying intangibility of the purchase context (i.e. product vs. service) on the above relationship. Third, evidence of the moderating influence of certain individual-level cultural value orientations (i.e. good vs. evil, changeable vs. unchangeable and doing vs. being) is found. It is also endeavoured to extend and validate the model to a new culture.     

Measuring customer equity and managing the customer asset: an explanatory study in the Australian hotels

Although there are a range of conceptual and theoretical studies about customer equity (CE) measurement and management in the literature, there are few empirical studies where these two concepts are examined together. This paper focuses on the need for a more synthesised approach and addresses calls for more research into this specific area of marketing management. A conceptual framework was developed that synthesises both customer lifetime value and customer relationship management from a customer equity management (CEM) perspective. The framework was used to empirically examine how four CE strategies, together with a firm’s use of the two types of customer data (aggregated and disaggregated), impact on CEM outcomes. Data were collected from 114 hotel managers in Australia and analysed through a decision tree methodology. The results show that hotels are utilising their CE strategies for acquisition purposes more than retention purposes (customer asset management), which overall appears to satisfice more than maximise their hotel’s capacity in achieving effective CE outcomes. The study’s contribution to theory is through empirically testing a framework that combines two discrete theoretical concepts in one study to provide insights to guide future research.     

The Hunt–Vitell General Theoryof Marketing Ethics: Can it Enhance our Understanding of Principal-Agent Relationships in Channels of Distribution?

This paper advances the Hunt–Vitell General Theory of Marketing Ethics as a framework for enriching current understanding of both long-term marketing relationships in general, and principal-agent associations specifically. Under economic models of agency theory, manufacturer-distributor relationships are conceptualized as principal-agent associations where both parties are assumed be motivated exclusively by short-term financial self-interest within the logical constraints of zero-sum game conditions. As a general model of ethical decision making and behavior in marketing, the Hunt–Vitell theory illustrates how ethical decisions are predicated not only upon estimations of potential benefits or outcomes (using teleological criteria), but also deontological evaluations which invoke norms and values. Furthermore, the recent ideas advanced in "relationship marketing" perspectives suggest that distribution channel associations premised upon non-zero-sum or symbiotic assumptions may be more effective and more jointly profitable. Based upon the Hunt–Vitell model, propositions are formulated that complement the understanding of agency theory within the context of marketing channel relationships, and thus, may represent a basis for more effective agency selection and interaction in marketing practice.     

Inter-Organisational Relationships and Strategy Development in an Evolving Industrial Network: Mapping Structure and Process

The paper explores the complexity of organisational strategies and relationships within an industrial supply chain. Whilst a considerable body of literature exists on inter-organisational relationships (IORs), our assertion is that much of this takes an overly deterministic view of the complex and sometimes conflicting situations that profoundly affect an organisation's (and, indeed, a network's) ability to perform effectively. Thus we turn for insight to literature beyond the traditional marketing arena, i.e.to sociology and organisational science.

We begin by relating aspects of the relationship marketing (RM) literature to a case context wherein the focal firm operates globally, supplying speciality chemicals to the chemical manufacturing market. Next, a brief comparison between the RM and the rather more inductive network (NW) literatures is undertaken. In a section representing the core theoretical underpinning of our study, Giddens' (1984) notion of structuration is then discussed; in particular how it relates to industrial NWs. Further literature from the management sphere is introduced to illustrate how a structurationist perspective might be taken forward in business marketing research.

Thereafter, following a discussion of methodological issues, we describe the case findings. These are presented in the form of "before" and "after" scenarios which illustrate both intra- and inter-firm issues. Our analysis highlights factors and behaviours which we believe can redirect (consciously or not) an organisation's activities away from any intended relationship building and towards a transactional orientation, despite the long term consequences for the NW. In the paper's conclusions, as well as making some pertinent case observations, we discuss the utility of a structurationist approach to research. Finally, we give some recommendations both for the focal case company and for further research into IORs.     

Internet-Based Relationship Marketing: A Sub-Saharan African Perspective

Establishing, maintaining, and enhancing relationships over the Internet have progressively gained global attention. Nevertheless, the dawn of this modernization draws many theoretical debates and practical concerns, some of which have received little research attention, especially within the Sub-Saharan region of Africa. On this premise, we explored the contemporary practice, challenges, and benefits of Internet-based relationship marketing (RM) within the Ghanaian telecommunication industry. Expert interviews with 12 employees from four telecommunication firms elicited a wealth of experiential data analyzed thematically to understand the practice, challenges, and emerging benefits of Internet-based RM. Our findings suggest that issues of privacy concerns, erosion of face-to-face communication, and the tendency of unsolicited communication do not necessarily militate Internet-based RM within the Ghanaian telecommunication industry. We also identified emerging benefits, including online “virality,” a discovery environment, and improved firm reputation. We suggest enhancing online personalization through empathy, creating value with analytic information and managerial openness, and supporting enhanced knowledge development within the area. Directions for future studies include the possibility of comparative studies across service industries and examining the role of content marketing in Internet-based relationships. The challenge of exploring Internet-based RM was similar to hitting a moving target, as the use of the Internet for relationship marketing activities is constantly evolving. Additionally, our findings and conclusion are confined to the knowledge contribution of the experts interviewed. As one of the few studies within the Sub-Saharan region, we expand contributions from the Sub-Saharan domain. The findings of this study also bring to light new insights for establishing, maintaining, and enhancing Internet-based relationships.     

Marketing and public relations: the relationship revisited

This paper reviews the debate within both the marketing and public relations literatures concerning the relationship between the disciplines of marketing and public relations. The paper considers the arguments advanced in the marketing literature, in particular, for a growing convergence between these two disciplines and examines the recent emergence of the concept of'marketing public relations'. Here the paper takes as one starting point an article which identified a number of possible schematic representations of the relationship between the marketing and public relations functions and argues the case for a model of increasing convergence between them.The paper goes on to consider the more recent development of ‘marketing public relations', examining the arguments advanced. The paper argues that from a public relations perspective, the concept of marketing public relations can be seen as an attempt by marketers to ‘hijack’ public relations, incorporating it as an extra element within the promotional mix in order to inform, persuade or remind existing and prospective customers of product or company benefits. It is argued that what some marketers have termed marketing public relations may be no more than the publicity element of public relations practice under a new guise — one perhaps more acceptable than publicity in the societally orientated firms of today. The paper explores two distinct schools of thought — re-examining the relationship between marketing and public relations from both perspectives. The paper suggests that the uneasy symbiosis between these two functions in practice, reflects to a large degree the ambiguity surrounding the relationship between these concepts within much of the literature.     

Impersonal vs. Personal Exchanges in Marketing Relationships

Considerations about the future of marketing discipline bring to the surface an important question of marketing relationships management. The aim of this paper is to analyse the phenomenon of marketing relationships as a paradigmatic shift in the marketing discipline. Through the critique of marketing management approach we are searching for the theory that will help to transcend the action oriented marketing philosophy. Our discussion is rooted in the social exchange theory and the two fundamental processes of human exchange interactions – the process of friendship building and the process of power relations. Through the application of the analysis of the processes of interpersonal relations we discuss marketing relationships and extreme types of marketing perspectives: power relations, intrusive selling, conventional marketing exchange and marketing relationships. Conventional (transactional) marketing management and marketing relationships fundamentally at odds with one another, resembling the old Chinese concepts of yin and yang. We conclude that managers are facing the problem of "schizomarketing disorientation", when entering into different marketing processes with different segments of customers.     

Becoming familiar with eternal anonymity: how sperm banks use relationship marketing strategy

The article focuses on donor profiles as a major marketing tool of the fertility industry and proposes some theoretical insights into sperm banking and sperm consumption, using a content analysis of 135 extended sperm donor profiles and a visual analysis of 36 baby photos in nine sperm banks. Theorizing sperm consumption is inspired by Grönroos' conceptualization of relationship marketing (RM). Contrary to conventional logic, I show how RM itself has become a product on its own, rather than a business strategy: while the sperm consumer is invited through anonymously written narratives to become an active prosumer by encoding and decoding parts of the donor's identity, the imaginary relationship with the donor constitutes the core product. Since donor profiles are purchased as a complementary service product, sperm banks activate identity construction among the donors by asking them to provide lengthy essays; donors produce polyphonic narratives and therefore participate in a Bakhtinian mask parade.     

An Evaluation of Organisational Control Strategies for Relationship Marketing

This paper discusses the issue of organisational control with respect to marketing. In particular it explores the implications of calls by relationship marketers to discard bureaucracy and embrace alternative forms of control which, they argue, are more conducive to the facilitation of exchange relationships. The paper fills a gap in the literature by situating bureaucratic control within the scheme developed by social theorist Max Weber (1946) and amplified by Etzioni (1964). This enables discussion of a number of alternatives to bureaucracy including some that have not previously been discussed by marketing theorists. An assessment of the evidence of the implementation of alternatives to bureaucracy indicates that while each form has merit, they also suffer from drawbacks. Paradoxically alternatives often serve to complement bureaucratic control and may even come to replicate it. Marketers' aspirations towards decentralised, flat structures are called into question in the light of evidence that suggests that centralisation and hierarchy are features even of virtual organisations. Finally it is suggested that reassessed, bureaucracy can in fact be a useful and effective form for the organisation and control of marketing activities.