Uppsala universitet

3. Relationship Marketing
3.1 The Concept of Relationship Marketing
The term “relationship marketing” has become popular during the 1990s, both as a fad word
and as a concept. The traditional concept of marketing is often described as referring to
operations where the market is manipulated through a marketing programme involving the 4Ps
of the marketing mix model: product, price, place, and promotion. In the late 1970s a new
concept evolved in northern Europe, elaborated simultaneously by researchers working in the
field of industrial marketing who developed the industrial network theory (e.g. Håkan
Håkansson and Jan Johanson) and in services marketing (the Nordic school of services, e.g.
Christian Grönroos and Evert Gummesson). The new approach stressed the relationship

---

8
between the seller and the customer, and ever since the publication of an article by Professor
Leonard L. Berry in 1983 (Berry, 1983), the most widely used term for this perspective has
been relationship marketing.
The new perspective was created as a counter reaction to the view of transaction
marketing in mass markets, symbolised by the 4Ps. Establishing, strengthening, and developing
of relationships with customers was in focus, in particular primarily long-term and enduring
relationships.
Transactional focus
Relationship focus
• Orientation to single sales
• Orientation to customer retention
• Discontinuous customer contact
• Continuous customer contact
• Focus on product features
• Focus on customer value
• Short time scale
• Long time scale
• Little emphasis on customer service
• High customer service emphasis
• Limited commitment to meeting customer • High commitment to meeting customer
expectations
expectations
• Quality is the concern of production staff • Quality is the concern of all staff
Figure 3.
The shift to relationship marketing.
(Source: Payne et al., 1995, p. viii)
Thinking of marketing in terms of having customers, not merely acquiring customers is crucial
for service firms. Berry defined relationship marketing as attracting, maintaining, enhancing,
and commercialising customer relationships, so that the objectives of the parties involved are
met (Berry, 1983). This is achieved by a mutual exchange and fulfilment of promises.
Establishing a relationship involves making promises, maintaining it is based on fulfilment of
the promises made, and enhancing it entails making a new set of promises (Grönroos, 1990b).
Relationship marketing, based on the fact that provider and customer co-operate to a
certain extent in a joint process where production and consumption occur simultaneously,
implies mutual co-operation between the parties instead of conflict and competition. This does
not mean, however, that these variables are eliminated, only that they are made more explicit
and easy to control (Grönroos, 1996).

---

9
A good relationship implies at least two fundamental conditions. First, it should be
mutually rewarding to the provider and the customer (i.e., they should both benefit from the
connection) and second, it involves some kind of mutual commitment over time. In establishing
and maintaining customer relations, the seller gives a set of promises that are connected with
goods, services, or other benefits. In exchange, the buyer gives his or her promises and these
promises must be kept on both sides in order to ensure profitable long-term business
operations (Grönroos, 1990a).