often involves increasing customer service levels and tailoring the
product or service offer to suit individual customers or customer
groups. Successful retention programmes will segment customers
according to their potential lifetime profitability and then determine
the type and frequency of marketing activity relevant for each group
to increase this potential.
Focusing on customers is, however, necessary but not sufficient. It
has been argued that with increasing competitive activity in virtu-
ally every industrial, consumer and service sector we are approach-
ing an era of hyper-competition where increasingly it is being
recognized that it is supply chains rather than firms which compete.
The next chapter focuses on the supplier and alliance market
domain and its role in relationship marketing.
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52 Relationship Marketing