Relationship marketing 37
might also benefit from attention to the condi-
tions that foster relational bonds. Thus, this
important paper legitimized relationship mar-
keting in business markets and opened up the
possibility that it might be an appropriate
vehicle to engender customer retention in mass
consumer markets.
The major contributions of US researchers
include:
Interaction between organizations must be
understood in terms of economic, behavioural
and political influences (Stern and Reve, 1980).
Explicit consideration of social exchange
theory (SET) in conceptualizing relationship
development (Anderson and Narus, 1984,
1990; Dwyer et al., 1987).
Creation of models of relationship
development explained in terms of increasing
commitment and trust (Anderson and Narus,
1984, 1990; Dwyer et al., 1987). This work
underpinned the later work of Morgan and
Hunt (1984).
The recognition that co-operation and
communication lead to trust, which in turn
leads to greater levels of co-operation
(Anderson and Narus, 1984, 1990).
Relationship marketing in
consumer markets
Relationship marketing developed in industrial
and service marketing contexts as a reaction
against the limitations of mainstream (transac-
tional) marketing. Initially eschewed by manu-
facturers interested in mass consumer markets
because of the efficiency of the mix manage-
ment paradigm, changes in the competitive
climate in the latter part of the 1980s and early
1990s propelled the interest in relationship
marketing in mass consumer markets. Indeed,
it may be useful to conceptualize considera-
tions of relationship marketing in mass
consumer markets in terms of four phases:
obscurity, discovery, acceptance and popularity
(see O’Malley and Tynan, 2000). Prior to
the mid-1980s (obscurity) there was little
consideration of the need for customer reten-
tion (cf. Rosenberg and Czepiel, 1984). In the
latter part of the 1980s, technology develop-
ments fuelled the growth of direct and database
marketing (Fletcher et al., 1991; Evans et al.,
1996), which Dwyer et al. (1987) argued could
usefully form the basis of relationship market-
ing in mass consumer markets. This, together
with other academic considerations of direct
and database marketing, marked the period of
discovery for relationship marketing (O’Malley
and Tynan, 2000). Essentially, the recognition
that customer retention is far less costly and
significantly more profitable than a focus on
customer acquisition (Rosenberg and Czepiel,
1984; Reichheld and Sasser, 1990) cemented the
business argument justifying a new approach.
Acceptance is largely attributed to the work of
Sheth and Parvatiyar (1995), who not only
argued the benefits of relationship marketing in
a consumer context but, more importantly,
reframed relationship marketing within the
extant consumer behaviour literature. Thus,
although there were some suggestions that
relationship marketing might not be appro-
priate in a consumer context (e.g. Gr ̈onroos,
1994; Barnes, 1994, 1995), marketing practi-
tioners were already doing relationship market-
ing – often in the form of loyalty or retention
programmes. Relationship marketing became
increasingly popular throughout the latter part
of the 1990s and is still hugely popular today.
Whilst some argue that relationships have
always been important to consumers (e.g.
Sheth and Parvatiyar, 1995) and that these
relationships can be facilitated by recourse to
technology (Dwyer et al., 1987; Blattberg and
Deighton, 1991), others argue that this is a
convenient repackaging of direct marketing
within the philosophy of relationship market-
ing (see O’Malley and Tynan, 1999, 2000).
Notwithstanding the conceptual debate, rela-
tionship marketing is greatly facilitated by
advances in technology and, in particular, the
database. Whilst this is largely viewed as
unproblematic, there have been suggestions
that the overt emphasis on technology actually