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Relationship marketing

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The term relationship marketing refers to a business selling strategy where stress is laid on building long term relationships with customers, rather than on individual transactions. This is a long term process, because care is taken to know and understand the customer’s needs and provide solutions for them.


Cultivating a relationship with the customers in business is an approach that is mainly concerned with maintaining an affiliation with current customers rather than on acquiring new ones. This utilizes a wide range of marketing, sales, communication, and customer care techniques and processes, to identify individual customer’s needs and create a relationship between a company and these customers. The primary goal of relationship marketing is to build and maintain a base of committed customers who are profitable for the organization.


The initial research was done by Leonard Berry at Texas A&M (Berry, L. 1982) and Jag Sheth at Emory, both of whom were the initial users of the term "Relationship Marketing", and by marketing theorist Theodore Levitt at Harvard (Levitt, T. 1983) who broadened the scope of marketing, from individual transactions to personalizing the consumer-producer relationship.


Central to this concept is the idea of ‘customer retention’, which concentrates on the preservation of customer loyalty.  According to Gordon, relationship marketing involves the creation of new and mutual value between a supplier and individual customer. Novelty and mutuality deepen, extend and prolong relationships, creating yet more opportunities for customer and supplier to benefit one another. Statistics of industries have revealed that the cost of retaining an existing customer is only about 10% of the cost of acquiring a new customer so it can often make economic sense to pay more attention to existing customers. (Wikipedia, the Free Encyclopedia)


A marketing website, identifies two major factors that are to be kept in mind pursuing a relationship-marketing strategy. The first is the ‘life cycle’ which determines the marketing approach used with the customer, and the second is the ‘trigger’ which is dependant on customer behavior over time (the customer life cycle), to trigger the marketing approach.

Relationship Marketing is dependant on the event-driven tactics of customer retention marketing, but treats marketing as a process over time rather than single unconnected events.  By molding the marketing message and tactics to the life cycle of the customer, the Relationship Marketing approach achieves very high customer satisfaction and is highly profitable.

Adrian Payne (1991) from Cranfield University identifies six markets which he claims are central to relationship marketing. They are:


·         internal markets

·         supplier markets

·         recruitment markets

·         referral markets

·         influence markets

·         customer markets


Relationship marketing stresses on what it calls internal marketing. This refers to using marketing techniques within the organization itself. According to this theory, every employee, team, or department in the company is simultaneously a supplier and a customer of services and products. Referral marketing is developing and implementing a marketing plan to stimulate referrals. This may take months, but it ensures returns. Marketing to suppliers is aimed at ensuring a long-term conflict-free relationship in which all parties understand each other's needs and exceed each other's expectations. Such a strategy can reduce costs and improve quality.


Influence markets, on the other hand, involve a wide range of sub-markets including: government regulators, standards bodies, lobbyists, stockholders, bankers, venture capitalists, financial analysts, stockbrokers, consumer associations, environmental associations, and labour associations. These activities are typically carried out by the public relations department, but relationship marketers feel that marketing to all six markets is the responsibility of everyone in the organization. (Wikipedia, the Free Encyclopedia)




Berry, Leonard (1983). Relationship Marketing. American Marketing Association, Chicago, 146.  ISBN 0877571619


Levitt, T. (1983) "After the sale is over", Harvard Business Review, Sept-Oct, 1983


Gordon, Ian (1999). Relationship Marketing: New Strategies, Techniques and Technologies to Win the Customers You Want and Keep Them Forever. John Wiley and Sons Publishers, 336.  ISBN 0471641731


Wikipedia, the free enclycolopedia

Available from: Relationship_marketing

C/M/600. Relationship Marketing: Analysis of Commitment-Trust Theory

C/M/548. Customer Relationship Marketing: Lufthansa Passenger Transportation

S/M/270. Relationship marketing: theory and case study of O2 mobile operator

C/HR/140. Relationship marketing at Tesco and the application of knowledge management and strategic human resource management

C/M/411. Can the Internet, as an effective marketing tool, be used to improve Vodafone's Customer Relationship?

S/M/259. Customer Orientation in Empress City Spa Taiwan

S/M/221. Critical Evaluation of the Student Service Provided by NatWest

E/M/174. It is never the responsibility of the buyer to adjust to the style of the seller. Do you agree? Why does this become so much more important when marketing products across national boundaries?

S/M/260. Customer centrality in 7-ELEVEN Taiwan

S/M/258. Taking an organization with which you are familiar, Identify the extent to which the customer is central to the business. To what extent, if any, does the organization takes its cues from 'buyers' and how appropriate is customer orientation as a concept here?

S/M/257. Customer Centrality at YKK Group

C/M/393. The Relationship Marketing Literature: A Critical Review

C/M/382. Analysis of the relationship marketing status and operations of Tesco Plc with respect to both suppliers and customers

E/M/150. E-relationship marketing tactics

S/M/204. Relationship Marketing: A Critical Appraisal

E/M/96. Customer complaints: role, problems, solutions

S/M/185. From the perspective of a relevant company of your choice write an essay that analyses key trends in marketing thought and practices that will shape that firm over the coming decade. (Marriott International and Reward Cards)

P/M/781. Theoretical approaches to relationship marketing and customer relationship management

P/M/763. Relationship marketing in Amazon, WHSmith and Tesco

E/M/75. Keys to success in customer service: theory and case study of Wal-Mart

C/M/319. Brand and customer relations in media companies

P/M/652. Customer service audit

C/M/306. The Importance of Consumer Behaviour to Marketing: The Case of Asda

P/M/581. Trust in business relationships

P/M/573. Nectar loyalty programme

P/M/565. Report on relationship marketing in Cisco

S/M/152. Relationship Marketing - A Literature Review

P/M/500. Dissertation. Role of relationship marketing in UK banks customer retention

P/M/470. Report on Cockburn Veterinary Group

P/M/468. Strengthening of retention management in banking sector

P/M/433. Efficacy of relationship marketing

S/M/105. A comparison of a business-to-consumer and a business-to-business organisation in terms of customer DMP, satisfaction and relationship

P/M/377. Relationship marketing of Nike

P/M/335. Analysis of Customer-Oriented Approach in Toyota

P/M/313. Is relationship marketing always the right answer?

S/M/64. Relationship Marketing

S/M/44. 'The crucial question arising is thus whether metaphors and their particular usage enlighten or rather distort our views and understanding¿' Discuss

C/M/107. Blueprint for excellent customer services for UK shopping centres

P/M/253. Dissertation. Loyalty Cards: building relationship between supermarkets and customers

S/M/36. A number of metaphors (including courtship, relationship and marriage) have been proposed to explain the shift away from managing one-off transactions in business to consumer (B2C) marketing exchanges to building, developing and maintaining a relationship marketing approach. Critically appraise the appropriateness of such metaphors, illustrating your essay with relevant examples from an organisation, industry or sector of your choice.

P/M/228. Relationship marketing and E-commerce in Business-to-Business marketing

P/M/218. Loyalty Cards

C/M/95. Relationship Marketing

P/EI/25. Identify what you consider to be the major differences between, and future trends of, ECRM and CRM. Can ECRM and CRM be implemented in isolation from one another?

P/EI/24. Discuss the phases of evolution of ECRM from Mass Marketing through to Permission Marketing, using practical examples to highlight the benefits and disadvantages of each.

C/M/90. Relationship Marketing: balance of power between consumers and companies

P/M/167. Relationship Marketing

P/M/31. ´RELATIONSHIP MARKETING IS APPLICABLE TO ALL INDUSTRY SECTORŽ: -Discuss the extent to which this is true.

P/M/124. CRM - Customer Relationship Marketing

C/M/67. Customer Relationship Marketing (CRM) Strategy: the Case of Reiss

C/M/68. European Market Entry Strategy via Brand Development: the case of Reiss

P/M/143. How can HSBC bank improve its strategic position by using relationship marketing?

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