Relationship Marketing and Its Application in Advertising Agency - Client Business Practice - a Conceptual Framework

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"Marketing is to establish, maintain, enhance and commercialize customer relationships, (often but not necessarily long term relationships) so that the objectives of the parties involved are met. This is done a mutual exchange and fulfillment of promises."

In this definition customer relationship has got the key attention for achieving the objectives of involvement parties though mutual exchange and fulfilling the promise. Perhaps in this way a service firm may introduce a successful marketing strategy. As Christopher et al. (1991) contend that in the overall marketing strategy of the (service) firm, the quality improvement programs and customer service initiatives are to be welcomed and they should be firmly embedded. To them, "this is the major challenge for the emerging redefinition of marketing as being primarily concerned with the establishment of enduring and mutually profitable relationship between the firm and its customers.”

They further argue that in the past, so often marketing, quality and customer service have been treated separately and unrelatedly, but the separation of these three critical areas can be compared with three spotlights on a stage which will shine and beam with different intensity from the different points of that stage. They believe that the impact on customer will be more effective if an organization brings these three beams as an alignment for facing the task and it can be a major challenge for the organization to bring these three critical areas into closer alignment. To Christopher et al., "marketing is concerned with exchange relationships between the organization and its customers and quality and customer service are key linkages in this relationship." Graphically they represent (see Figure-1) the linkages between marketing, quality and customer service to show how organizations possibly can achieve the customer satisfaction and subsequently can maintain a long-term relationship.

Figure-1:Linkages between Marketing, Customer Service and Quality

[pic 1]

Source: Christopher et al. (1991).

For the lack of alignment of three important areas (i.e. marketing, quality, and customer service) the relationship marketing has emerged as a concept to integrate customer service and quality with a market orientation (Christopher et al. 1991). Traditionally, market orientation means the implementation of the marketing concept, thus, the actions of market orientated organization are consistent with the marketing concept. To marketing researchers, market orientation is the 'organization culture' (i.e., values, beliefs and environment) that creates the necessary behaviors, most adequately and effectively, for the production of greater value for buyers and thus, continuous better performance for the business (Kotler 1984). This market orientation concept does not consider the 'keeping the customers' idea explicitly, although implicitly the creation of 'necessary behaviors' indicate the way of retention of customers. Gummesson (1991) argues that,

"Marketing-orientation only becomes alive when all members of an organization have asked them lves 'How do I contribute to excellence in customer relations and to revenue?' have answered the question and implemented the answer.”

Therefore, Christopher et al. argue that traditionally marketing has been about 'getting' customers rather than 'keeping' them, but relationship marketing concerns to both 'getting and keeping' customers. For getting and keeping the customers, the new market orientation philosophy is important to the organization. Relationship marketing concept, perhaps, can implement that philosophy providing quality service to the customer(s) or partner(s). The figure-2 shows the relationship marketing orientation bringing together quality, customer service and marketing.

Figure-2:

The Relationship Marketing-Orientation

[pic 2]

Source: Christopher et al. (1991)

1.3.The practice of Relationship Marketing

As one of the pioneers of relationship marketing concept. Berry (1983) defines that “relationship marketing is attracting, maintaining and--in multi-service organizations --enhancing customer relationships.”

To Gronroos (1989) Establishing (attracting) maintains and enhancing customer relationships respectively include the following three process of marketing:

- the first contact with a customer so that relationship emerges;

- maintenance of an existing relationship so that the customer is willing to continue to do business with the other party of the relationship: and

- enhancement of an on-going relationship so that the customer decides to expand the content of the relationship, for example, purchasing new types of products from the same seller.

The transformation of general customer into loyal ones and servicing them as clients is also relationship marketing (Berry, 1983). It means that the customers those who will remain for a long time can be treated as the loyal customers may work as the reference group for the company. He argues that as acquiring new customers, servicing and selling to existing customers are important for long-term marketing success. The long-term marketing success can be viewed as the long- term business success. Organization needs to provide good service and good selling respectively for retaining and enhancing the customers. Christopher et al. (1991) also argue that a continuous significant improvement of financial and market performance of a firm depends on relationships –based marketing and the result of long-term relation of customers’ attention. Jackson(1985) considers the ‘wining and keeping customers’ as the dynamics of customer relationships. Jackson argues that,

"relationship marketing, or marketing oriented toward strong, lasting relationships with individuals accounts can be extremely important where it is appropriate....”

He explores the importance of industrial marketing relationships and concludes that winning, maintaining and understanding are frequently hard for long-term relationships with industrial customers, and yet it is difficult to execute well, but, if well executed, it can bring profits and market share to vendors, because it is extremely attractive to them.

The meaning of 'retaining