Relationship Marketing Approaches in Services Marketing
| 2012 | | Relationship Marketing Approaches in Services Marketing |
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Over the last years the focus of marketing has changed from transactional to relationship marketing because companies realized that is cheaper to keep old customers rather than attracting new ones. Also this shift has occurred because of the intense rivalry that can be noticed in every industry. Besides its main goal of retaining customers and encouraging repeats, relationship marketing also creates value through relationships between buyers and sellers as well inside the organisation, or external with competitors, suppliers and distributors. A develop definition of relationship marketing by Christian Grönroos in 1989 would be: The purpose of relationship marketing is to identify and establish, maintain and enhance, and when necessary terminate relationships with customers ( and other parties) so that the objectives regarding economic and other variables of all parties are met .This is achieved through a mutual making and fulfilment of promises.
Transactional vs. Relationship Marketing The well-known transactional marketing, developed in late 1950’s, is based on the concept of the four P’s as Borden argued in 1964. Many principals that are still popular among marketing practitioners and academics have their source in transactional marketing, but in nowadays business environment it has been created a paradigm shift from transactional marketing to relationship marketing, thereby marketing is evolving. The transactional approach used in marketing focuses on discrete transactions, which now does not fit anymore between contemporary marketing practices. The main differences between relationship marketing and the transactional one can be easily observed in the table and figures below.
The Strategy Continuum
Relationship Marketing
Transactional Marketing
The Product Continuum
Consumer
Packaged Goods
Consumer
Durables
Industrial
Goods
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Over the last years the focus of marketing has changed from transactional to relationship marketing because companies realized that is cheaper to keep old customers rather than attracting new ones. Also this shift has occurred because of the intense rivalry that can be noticed in every industry. Besides its main goal of retaining customers and encouraging repeats, relationship marketing also creates value through relationships between buyers and sellers as well inside the organisation, or external with competitors, suppliers and distributors. A develop definition of relationship marketing by Christian Grönroos in 1989 would be: The purpose of relationship marketing is to identify and establish, maintain and enhance, and when necessary terminate relationships with customers ( and other parties) so that the objectives regarding economic and other variables of all parties are met .This is achieved through a mutual making and fulfilment of promises.
Transactional vs. Relationship Marketing The well-known transactional marketing, developed in late 1950’s, is based on the concept of the four P’s as Borden argued in 1964. Many principals that are still popular among marketing practitioners and academics have their source in transactional marketing, but in nowadays business environment it has been created a paradigm shift from transactional marketing to relationship marketing, thereby marketing is evolving. The transactional approach used in marketing focuses on discrete transactions, which now does not fit anymore between contemporary marketing practices. The main differences between relationship marketing and the transactional one can be easily observed in the table and figures below.
The Strategy Continuum
Relationship Marketing
Transactional Marketing
The Product Continuum
Consumer
Packaged Goods
Consumer
Durables
Industrial
Goods
References: Blois, K.J. (1996) Relationship marketing in organisational markets: when is it appropriate? Journal of Marketing Management, Vol 12, pp. 161-173. Grönroos, C. (1994). Quo vadis, marketing? Toward a relationship marketing paradigm, Journal of Marketing Management, Vol 10, pp. 347-360. Grönroos, C. (1996) Relationship marketing: strategic and tactical implications, Management Decision, 34(3), pp. 5-14. Gummesson (1999). Total Relationship Marketing, Oxford, UK, Butterworth-Heinemann as cited in Hultman, C. and Shaw, E. (2003). The interface between transactional and relational orientation in small service firm’s marketing behaviour: a study of Scottish and Swedish small firms in the service sector, Journal of Marketing, 11(1), pp. 36-51. Lovelock, C. and Wirtz, J. (2004) Services Marketing – People, Technology, Strategy, Fifth Edition, USA, Pearson - Prentice Hall. Palmer, A. (2001). Principles of Services Marketing, Third Edition, England, McGraw Hill. Reichheld, F. and Sasser, W. (1990). Zero defections: quality comes to services, Harvard Business Review, 68(5), pp. 105-111. Zeithaml, V. A. & Bitner M. J. (2003) Services Marketing – Integrating Customer Focus Across The Firm, New York, McGraw-Hill.