series of frequently cited environmental factors: technological
advances and the deregulation of markets, creating intensified
global competition. These forces have changed and continue to
change the dynamics of the marketplace, raising the profile of time-
based competition and causing shifts in channel power. The world
is becoming a buyers’ market, where increasingly discerning cus-
tomers are freer than ever to select from their global marketplace –
something that many corporations in the Western world were woe-
fully slow to grasp.
As the effects of deregulation and technological change have
rippled through international trade, classical models of marketing
have been found to be wanting. The classical models are based on
the microeconomic market model and built around the ‘4 Ps’ frame-
work for marketing decision making, the latter emerging from the
work of Borden during the 1960s. Borden isolated 12 factors or ele-
ments which, when combined, would produce a ‘marketing mix’
that served to influence demand. The underlying concept was
quickly simplified and popularized by its distillation into the four
key elements of the teacher-friendly 4 Ps framework: product, price,
place and promotion.2, 3These models were developed from US
studies of the indigenous market for consumer goods during the
post-war boom of the 1950s and 1960s, an environment where rising
consumer demand gave companies little reason or incentive to con-
sider customer relationships as anything other than brief single
transactions. As such they reflect the realities of another era.
Critics have long argued that these models and the assumptions
on which they were based were inappropriate for industrial and
services contexts, where relationships with customers were often
on-going and of pivotal importance. They were also felt to be inad-
equate when applied to marketing in the international arena.4, 5, 6
Marketing management, as it was usually taught, represented
neither the aspirations nor the reality of these branches of market-
ing. With the arrival of recession in the 1990s it became widely rec-
ognized that, even in consumer markets, this classical marketing
paradigm had lost its potency.^7
From the early 1980s an alternative approach to marketing theory
and practice – Relationship Marketing – was in the ascendancy. The
term itself can be traced back to the services marketing literature,
though arguably it can be said to have originated in industrial mar-
keting.8, 9 In its earliest guises, relationship marketing focused
simply on the development and cultivation of longer-term prof-
2 Relationship Marketing