Relationship Marketing Theory: Its Roots and Direction

This paper participates in the latest discussion on theory formation in the marketing discipline. We argue that some of the novelty and generality claims in current relationship-marketing (RM) propositions are inflated. On the basis of a conceptual analysis of the disciplinary roots of RM thinking, we argue that RM does not form a general theory of marketing, and that actually two types of relationship theory exist: Market-based, more consumer-oriented RM, and Network-based, more interorganisationally-oriented RM. The fundamental differences between these two types of theory are identified and discussed. Theoretical conclusions and managerial challenges originating from the dual nature of relationship marketing conclude the paper.     

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.     

Editorial

The relationship marketing paradigm is gaining increasing credence in consumer markets. Marketers need to get close to their customers to establish exchange relationships, and this “intimacy” is achieved using database technology and direct marketing communications. However, in implementing relationship marketing in this way, the potential exists for the use of technology to result in invasions of individual consumer privacy. The literature on relationship marketing and privacy are reviewed, and the findings of six exploratory focus group discussions, conducted in the UK, are presented. The study suggests that what some consumers define as “intrusion” is similar to what has been called “intimacy” by marketers. Nine propositions are presented which reflect the implications of current approaches to relationship marketing in consumer markets. In particular, the integral elements of meaningful relationships are absent or inhibited as a result of consumer concerns over intrusions of their privacy. Thus, marketers need to adapt their attitudes, behaviours, and processes in order to accommodate the participation of the consumer in the relationship. The implications for marketers are identified, and directions are offered for future research.     

Toward a contingency theory of CRM adoption

Acknowledging the paucity of research on customers who are the targets of customer relationship management (CRM) efforts, this paper presents a contingency theory framework and set of research propositions suggesting that successful CRM adoption is contingent on a variety of contextual factors that influence value exchange in B2B channel relationships. Grounded in theoretical perspectives on the customer selection process, channel governance, transaction costs, power distribution in marketing channels, and dynamic capabilities, the authors identify five broad categories of variables potentially important in studying CRM adoption and directly affecting CRM success/failure.     

Trialogue on Facebook pages of grocery stores: Customer engagement or customer enragement?

Abstract

The pervasiveness of social media is compelling businesses to review their way of managing customer experiences. Businesses use social media to interact and engage with customers. Several studies have studied why businesses have adopted social media. However, there is a dearth of research as to why customers interact with businesses on social media in the grocery sector. This paper aims to explore how and why customers react to corporate messages on Facebook pages of Tesco and Walmart. Netnography approach was adopted to gain an insight into the various ways customers engage with the grocery stores on its Facebook pages. This study reveals that social media empower customers, influence the relationships customers have with grocery stores and generate customer engagement. Findings also show that the social customer is both a curse and a blessing to Tesco and Walmart when they create or destroy value for the business. This paper contributes to knowledge by (1) uncovering how customers react to corporate and customer posts on corporate Facebook pages; (2) showing how value can be created and destroyed; and (3) proposing a model illustrating how the main constructs of the study are interconnected: social media, relationship marketing, customer empowerment and customer engagement.     

Getting permission: Exploring factors affecting permission marketing

Permission marketing suggests an evolution of direct marketing, particularly used with e-mail. It combines databases of customers who agree to receive marketing messages with low-cost, customized e-mails that attempt to slice through advertising clutter, attract increased customer support, and change behavior.This applied research examined implementing permission marketing, relevant literature, and permission marketing's effectiveness influencing consumer interest and behavior. A case study tested the propositions resulting from the literature review and evaluated responses to a permission marketing campaign that used traditional and new media. This study found that relevance—personalization, brand equity, and previous relationships—influenced response rates. This article adds to the growing body of research on permission marketing's role in marketing theory, as well as its applied effectiveness in the marketplace.     

The role of customer gratitude in making relationship marketing investments successful

This paper recognises that customer loyalty is important for many competitive organisations, and that retail firms make investments to build and maintain loyal relationships with their existing and potential customers (e.g. loyalty programs). However, there has been little focus on the mechanisms by which these relationship investments operate to achieve customer loyalty. This paper examines one mechanism, namely customer gratitude, which works to make a firm’s relationship marketing investment a success or a failure. Using data from 1600 undergraduate students, this study empirically confirms the mediating role of customer gratitude between the customers’ perceptions a firm’s relationship marketing investments and customers’ perceptions of the value of the relationship with the firm. Further, a significant moderating effect of perceived benevolence on the relationship between customers’ perceptions a firm’s relationship marketing investments and customer gratitude was identified. For theorists, this customer gratitude model offers a better psychological explanation of how relationship marketing investments operate to improve the value that customers place on their relationships with retailers. Our research suggests that managers should invest resources to stimulate customer gratitude in order to build strong customer–seller relationships.     

Working with customers: Cooperation and competition in relational marketing

The relationship and interaction between salespeople and their customers may be usefiilly examined in terms of how they believe their goals and interests are related. Twenty‐five sales persons and 40 travel agents and managers in charge of corporate travel were interviewed on specific interactions. Results support previous theorizing that productive conflict management and resulting trust and personal bonds contribute to successful marketing relationships and suggest that these dynamics occur when sales representatives and clients have developed strongly cooperative goals, but not when they have competitive or independent goals. Results were interpreted that the constructive discussion of opposing views complements cooperative goals as important contributors for developing successful relational marketing.     

A Foot in the Door: Relationship Marketing Efforts Towards Transaction-Oriented Customers

Despite the growing awareness and use of relationship marketing principles, there are still limitations to the range of exchange situations to which relationship marketing is applicable. Customers may resist suppliers' attempts to become intimate. This contribution deals with how suppliers seek to overcome customer unwillingness, through an investigative case study. Seven propositions are developed on the marketing relationship policies followed by suppliers seeking to initiate, maintain and terminate relations with transaction-oriented customers.     

Insights into Closeness of Relationship as Determinant of Trust Within Marketing Channels

Abstract

This article explores the role of closeness of relationship between channel members. Closeness is put forward as a genuine variable in channel relationships, as part of the processes that take place in marketing channel dyad interactions. Advances in theory of channel relationships are proposed by a deeper theoretical development of the concept “closeness of relationship” from a multidisciplinary approach by stressing its relevance and by proposing a definition of closeness of relationship. Several features and ideas about closeness are proposed, such as the link between closeness of relationship and type of marketing relationship. Content validity is assessed to distinguish closeness from related constructs before exploring and operationalizing such a concept. The relationship between closeness and trust is explored by proposing actions to increase trust and assessing it empirically. An exploratory research is performed in the Spanish computer sector, testing relationships between a set of closeness components and trust between channel members. Results show that there are two factors underlying the construct closeness: interdependence and communication. However, only communication variables are significantly related to trust. Several conclusions and research propositions relevant for marketing theory and practice are presented.     

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.     

LOGISTICS OUTSOURCING RELATIONSHIPS: CUSTOMER PERSPECTIVES

This study attempts to infuse relationship marketing theory into the study of logistics outsourcing relationships. In particular, the study demonstrates that not all of the partnerships between customers and providers of third‐party logistics services are the same in terms of their level of development. The existence of distinct levels of partnership established previously in the logistics literature is partially supported and a relationship between level of partnership development and the customer perceptions of key relationship marketing elements and outcomes is established. While exploratory in nature, these findings suggest there are benefits for the increased costs of developing closer partnerships.     

Effects of ethical sales behaviour,expertise, corporate reputation,and performance on relationship quality and loyalty

This analysis examines the influence of ethical sales behaviour, salesperson expertise, service performance, corporate reputation, and corporate performance on relationship quality and its consequences from multi-level perspectives in order to identify the nature of mix relationships at different levels. A survey with 505 qualified observations from financial institutions' customers in Taiwan was conducted. A structural equation modelling approach was used. Ethical sales behaviour, salesperson expertise, service performance, corporate reputation, and corporate performance, that is, the antecedents of relationship quality, have significant effects on relationship quality. Relationships exist between salespeople and customers, but customers also establish relationship with the retailers themselves. Satisfactory relationship quality has positive effects on commitment and loyalty. Implications for research and practice are discussed.     

Relationship Intention and Length of Customer–Firm Associations in Two Emerging Markets

ABSTRACT

Despite the benefits of following a relationship marketing approach, firms should use caution when targeting customers with relationship marketing strategies as not all customers want to enter into long-term relationships. Targeting customers based on the length of customer-firm association could also be flawed as the success of doing so is disputed. This study explored relationship intention under cell phone customers in two emerging markets, namely the Philippines and South Africa. Findings show that relationship marketing strategies should only be focused on customers displaying high relationship intentions rather than, erroneously, investing in relationships with customers based on association length.     

Value co-creation among hotels and disabled customers: An exploratory study

This study examines how service supplier and buyer value co-creation influences buyers' attitudes toward service providers. Service-dominant logic is a prevalent concept in the services industry, providing an important marketing theory in which intangible resources, co-creation of value, and relationships are the keys to determining marketing exchanges. This research describes a model for analyzing value co-creation management in the hotel industry, focusing on the specific market segment of disabled customers. This framework helps foster value co-creation to increase the benefits for participants during each stage of their relationship. The paper also presents the managerial implications of the research findings.     

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.     

The Role of Business and Friendships on WeChat Business: An Emerging Business Model in China

ABSTRACT

WeChat business is an emerging way of doing business in China, which can be considered as a marriage between traditional e-business and social networking communications. In WeChat business, firms have developed customer relationships along two distinct ways: business relationships and friendships. However, research on the combination of business relationships and friendships is relatively nascent, and there are contradictory findings. In this study, we examine the effectiveness of the two relationship strategies using data from a field experiment through the WeChat platform by an apparel firm. Results from the field experiment suggest that development of friendships with new customers can help the strategy of developing business relationships; but developing friendships and business relationships with experienced customers negates each other. The study contributes to the literature on relationship marketing and role theory, and helps WeChat managers clarify how new social networking relationships with customers can be effectively leveraged.     

Relationship Marketing and Customer Loyalty in a Retail Setting: A Dyadic Exploration

Customer loyalty is increasingly seen to be crucial to the success of business organisations, with the growing realisation that attracting new customers is far more expensive than retaining existing ones. It has been suggested that a way of increasing customer retention is through secure relationships between buyers and sellers. Surprisingly, however, and despite the growing body of literature on relationship marketing issues, little empirical research has been conducted on the link between relationship marketing and customer loyalty in a retailing context. This paper attempts to address this gap by presenting and testing a conceptual model of the process by which the implementation of relationship marketing can enhance such loyalty. A dyadic exploratory study of clothing store managers and their customers was conducted. Findings reveal that customers' perceptions of clothing stores' relationship marketing efforts are crucial to enhanced commitment and loyalty. Implications are drawn from these results, and future research directions are discussed.     

More expectations,more disappointments: Ego depletion in uncertain promotion

Uncertain promotion is used widely in marketing practice. This study discusses the ego depletion differences of consumers for three types of uncertain promotions based on expectation disconfirmation theory. Two studies show consumers have the greatest ego depletion in effort-oriented uncertain promotions, followed by skill-oriented and least luck-oriented promotions. Additionally, the ego depletion degree has a negative impact on activity satisfaction in the short-term and brand loyalty in the long-term. Finally, under the moderation of customers’ expectation realization states, achieving expectations has repaired ego depletion for three types of promotions, while failing to achieve expectations only aggravates ego depletion for skill-oriented promotions.     

Market orientation and customer-based corporate brand equity (CBCBE): a dyadic study of Indian B2B firms

The relationship between market orientation (MO) and one of its most important consequences – firm performance – has received considerable attention in marketing research. Performance has been largely judged through financial or objective measures. This paper connects assimilation of MO in firms with corporate brand performance since academics have not used judgmental or market-based measures in assessing performance. We have introduced customer-based corporate brand equity to obtain a rounded idea of firm performance. This is achieved through a dyadic study, instead of self-assessment, wherein the marketing chiefs of B2B firms and their respective organisational customers are surveyed to gauge the effects of incorporating MO. We have shown that corporate brand performance is enhanced significantly in the presence of organisational innovativeness. From a practitioner’s perspective, the study details the organisational actions to be taken to assimilate MO and how those can be exploited to enhance corporate brand performance.