An Analysis of the Fundamentals of Marketing (part 6)

Relationship Marketing

by

Charles Lamson

The long-running battle over the marketing concept became the focus of a new major orientation in marketing which was to gather pace during the late 1970s and into the 1980s. This approach has come to be known as relationship marketing. Christian Gronroos (1996) provided the keynote address for the first online relationship marketing conference. Gronroos attacked the idea of the marketing mix, or '4 Ps' (price, product, promotion and place) as it is more widely known, which he argues is formulaic and therefore bound to set marketing offtrack because it is competition and production-oriented. Rather than being in the customer's interests, i.e. somebody for whom something is done, the '4 Ps' approach implies that the customer is somebody to whom something is done.

Gronroos suggests that the '4 Ps' approach has distanced marketers from the marketing concept and that as a result, marketing has become the province of specialists. in this sense he argues that specialization of marketing has resulted in a double alienation (1996).

• This had the effect of alienating the rest of the organization from Marketing and with this alienation it is difficult, if not impossible, for Marketing to become the truly integrative function that it should be.
• The specialists organized within the marketing depart may become alienated from customers, because managing the marketing mix means relying on mass marketing. Customers become numbers for the marketing specialists, whose actions typically are based on surface information obtained from market research reports and market share statistics. Frequently such markets act without ever having encountered a real customer. Gronroos's concerns echo many of those which have been expressed earlier in this chapter with respect to the creation of distance by marketing processes.

Gronroos suggests that these contradictions can be resolved by means of a dynamic and fluid relationship marketing approach which can counter the straightjacket of the clinical transaction-based, mass-market approach of the '4 Ps'. The aim of relationship marketing is to establish, maintain and enhance relation with customers and other partners, at a profit, so that the objectives of all the parties are met. This is achieved by the mutual exchange and fulfillment of promises. Such promises are usually, but not exclusively, long-term. The establishment of a relationship can be divided into two parts: To attract the customer and to build the relationship with that customer so that the economic goals of that relationship can be achieved. This shifts the ground towards the part-time marketer; the recognition that, within organizations, many non-marketing specialists actually are practicing marketing functions. Internal marketing is needed to gain the support of these people. Both internally and externally, relationships have to be regulated by means of the exchange of promises to establish trust through the formation of relationships and dialogue with both internal and external customers. While the ultimate objective is to build a loyal customer base, there is no doubt that this refocusing of marketing to emphasize qualities of connectedness, dialogue and trust represents an attempt to uplift the process of marketing.

Gronroos's aspiration that marketing in the twenty-first century would be the era of a new relationship marketing based on the mutual exchange and fulfillment of promises has not so far come to fruition, nor, one might suggest is it likely to. Why? one reason is that, as it has evolved in practice, the umbrella term 'relationship marketing' subsumes a number of disparate even contradictory discourses associated with areas such as services marketing. It is quite conceivable to envisage a service provider who seeks to develop more meaningful relationships with customers. However, the rhetoric of direct marketing and database marketing has a quite different focus (Peppers et al., 1999). Through customer databases and mass customization the marketer plans the offers and communications on the basis of customer profile and feedback and can focus on the development of an individual 'relationship' with each of a large number of customers. The term 'relationship' is used advisedly and in a technical sense to point to two features which are required of the technology: its ability to address an individual and the ability to gather and 'remember' the response of that individual by means of a cookie. It is then possible to address the individual once more in a way that takes into account his or her unique response. In retrospect, there seems little to suggest that this is any less formulaic and subject to the supervision of specialists than the '4 Ps' approach that Gronroos attacked a decade earlier. The reality of database marketing in the real world to date is that it fails to live up to the ideal mentioned above (cf. Fornier et al., 1998). Rather it summons to mind the myopia that Levitt (1960) mentioned all those years ago. The technologies may be new, e.g. the crude use of databases, contact techniques such as the use of remote dialers, sPAM emails, coupled with the development of remote 'customer service' centers. But the underlying motive seems to be depressingly similar to that which Levitt warned against all those years ago: the pursuit of efficiency over effectiveness.

*SOURCE: FUNDAMENTALS OF MARKETING, 2007,  MARILYN A. STONE AND JOHN DESMOND, 35-36* 

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