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ABSTRACT
Relationship marketing is an old idea but a new focus now at the forefront of services marketing practice and academic research. The impetus for its development has come from the maturing of services marketing with the emphasis on quality, increased recognition of potential benefits for the firm and the customer, and technological advances. Accelerating interest and active research are extending the concept to incorporate newer, more sophisticated viewpoints. Emerging perspectives explored here include targeting profitable customers, using the strongest possible strategies for customer bonding, marketing to employees and other stakeholders, and building trust as a marketing tool. Although relationship marketing is developing, more research is needed before it reaches maturity. A baker's dozen of researchable questions suggests some future directions.
INTRODUCTION
Relationship Marketing is said to be one of the best contemporary marketing strategies for all companies’ irrespective of size, type or location. To satisfy customer needs and wants, superior product, superior customer service and organizational images are not enough rather trust, commitment, mutuality and long-term relationship with customers are paramount. The rationale behind relationship marketing is to create, maintain and enhance the relationship with various stakeholders to sustain in a competitive environment and get competitive advantage. For example, by sustaining relationship with profitable customers and reducing customer defection by 5 percent, a company can increase future profits by 2-8%. Webster (1992) concluded that ensuring the survival of firms in the face of turbulent market conditions usually demands that organizations learn how to exploit specialist knowledge as a basis for building stronger relationships In the business environment emerging today with a growing number of cluttered markets and relationship marketing is becoming necessary for organizational survival. Marketing is to identify, anticipate and satisfy customer’s needs and most of the traditional marketing approaches are used to build awareness about a company’s offerings and attract more customers. However, the true purpose of marketing is to build and maintain strong relationships between the company and the customers. Developing and maintaining satisfactory customer relationships can help to reduce perceived risk, reduce transaction costs, increase customer loyalty and customer retention and thus impact on organizational performance. For buyer-seller relationship it is very important and widely accepted that a company should have customer orientation rather than sales orientation. There are a number of studies that have clearly demonstrated that seller relationships with customers can help to engender loyalty and retention. Literature in relationship marketing has identified numerous factors those are associated with buyers-sellers relationships, such as Trust, Commitment, Customer Value, and Satisfaction. Relationship marketing can be defined as all of the activities dealing with establishing, developing and maintaining successful relational exchanges. Relationship Marketing is a strategy to attract, maintain, and enhance customer relationship’, which is fully supported by Berry and Parasuraman (1991) and defined as ‛Relationship Marketing concerns attracting, developing and retaining customer relationship’. Now it can be seen that Relationship Marketing not only
enhances customer relationship but also retains that relationship, which indicates a long-term phenomenon. Relationship Marketing refers to all marketing activities directed towards establishing, developing and maintaining successful relational exchanges’. However, Relationship Marketing (RM) is to identify and establish, maintain, enhance, and when necessary terminate relationship with customers and other stakeholders, at a profit, so that the objectives of all parties involved are met, and that this is done by a mutual exchange and fulfillment of promises’. Nevertheless, Relationship Marketing as
‛relationships, network and interaction’. Prior to the 1990s most of the European marketing scholars have focused on network marketing as one of the effective means to increase organizational profit. Although both concepts roots are the same as building relationship between sellers and buyers, but they do not overlap and interact. Sheth and Parvatiyar (1995) viewed Relationship Marketing as ‛attempts to involve and integrate customers, suppliers and other infrastructural patterns into firm developmental and marketing activities’. The ultimate goal of relationship marketing in today’s cluttered environment where shoppers behavior are affected by various macro environmental forces is to get customer loyalty and hence retention.