Relationship Marketing

Relationship Marketing

Relationship Marketing

Though it was first coined by Berry (1983) in the United States, relationship marketing as a term was not commonly used until the latter part of the 1980s. The term relationship marketing emphasises variables and processes such as trust, commitment, social norms, and so on. The key structural issue in relationship marketing stems from its raison d’etre: exchanging resources to provide mutual benefits and thus achieve mutual goals, which differentiate it from the conventional view of marketing, offered by American Marketing Association (1985) which involves the integrated analysis, planning and control of the ‘marketing mix’ variables (product, price, promotion, and distribution) to create exchange and satisfy both individual and organisational objectives. This approach is discarded in favour of relationship marketing by authors who consider it to be overly clinical and based solely on short-term economic transactions (Moller, 1992), and relevant only to certain types of firms and markets (Hakansson, 1982; Gummesson, 1987, 1994). Relationship marketing draws its ideas from the streams of research which are the Nordic School of Service (Gronroos & Gummesson, 1985; Gronroos, 1997; Berry & Parasuraman, 1993), which examines management and marketing from a service perspective, and the IMP Group (Hakansson, 1982; Hakansson & Snehota, 1995; Ford et. al., 1997), which takes a network and interaction approach to understanding business practice. A common denominator of these two schools of thought is that marketing is more a management issue than a function, and that managing marketing normally must be built upon relationships, not on transactions alone. Building and managing relationships has become a philosophical cornerstone of both the Nordic School of Service and the IMP Group since the late 1970s. Within North America, the development of relationship marketing can be traced to the work of Theodore Levitt and Barbara Bund Jackson at the Harvard Business School in Industrial Markets, and Len Barry and his colleagues at the Texas A&M University in service markets. Comprehensively, however, it can be defined as the process of identifying and establishing, maintaining and enhancing, and when necessary also terminating relationships 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 fulfilment of promises (Gronroos, 1990; 1997).

Sheth and Parvatiyar (1994) state that relationship marketing is the understanding, explanation and management of the on-going collaborative business relationship between suppliers whereas Gummesson (1995) defines it as a marketing approach based on relationships, interactions, and networks. In more general terms, Gronroos (1996) defines relationship-oriented approach to marketing as a phenomenon related to the relationships between a firm and its environment. It points out that marketing includes all necessary efforts required to prepare an organisation for activities needed to manage the interfaces with its environment. Markets are, of course, of several kinds: customers, distributors, suppliers, and networks of co-operating partners. The relationship philosophy relies on co-operation and a trusting relationship with other stakeholders and network partners. While the approach has been widely used in the corporate sector, the potential application of this emerging body of knowledge for managing the complex and dynamic tourism domain has not been clearly addressed. Hence, there is a need to examine its application to create partnerships with recognition that tourism plays an important role in revitalising rural communities and economies, historically dependent on natural resource-based commodities.

There are three key mechanisms inherent in the approach to achieve effective resource management. First, it provides a framework, which focuses on strategic decisions concerning collaboration between providers. Second, it recognises variables like trust, commitment, mutual understanding and reciprocity that encourage and stimulate entrepreneurial and innovative thinking towards partnership building (e.g., Anderson & Narus, 1990; Day & Klein, 1987;Dwyer, Schurr & Oh, 1987; Frazier, Spekman & O’Neal, 1988; Salmond & Spekman, 1986). Third, it engenders an organisational values system and strategies conducive to partnerships. It is appropriate in the sustainable tourism context because it recognises the importance of partnerships between suppliers, which affect the broad framework of tourism provision where resource conservation is the primary aim. Also, the task of marketing is not so much to identify potential markets when applied in the sustainable tourism context as to educate the consumer about sustainability and sensitive tourism practices, which makes the traditional marketing approach inappropriate. Gronroos (1999) contends that relationship marketing is more than the synonym used for developing alliances, and networks, or as part of marketing communications only. It requires a totally new approach to some of the fundamental thoughts in marketing as relationships entail communication content (information), exchange content (goods and services), and normative content (mutual expectations), and thus bringing in the personal dimension of the relationships amongst providers. The approach of relationship marketing as it relates to networking and collaboration can further be explained using seven dimensions (Moller, 2000)

From “Case for Relationship Marketing: Issues in Relating the Approach to Tourism Partnerships“ by Gunjan Saxena

 

 

 

 

 

 

 

 

 

 

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