Journal of Services Marketing

Relationship marketing: looking backwards towards the future

Adrian Payne, Pennie Frow,
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 Relationship marketing: looking backwards
towards the future
Adrian Payne
School of Marketing, University of New South Wales, Sydney, Australia, and
Pennie Frow
Discipline of Marketing, University of Sydney, Sydney, Australia

Abstract
Purpose – This paper aims to review the growth and development of the field of relationship marketing and, through a consideration of this
body of work, identifies key research priorities for the future of relationship marketing. The paper also delineates the frequently confused
associated concepts of customer relationship management and customer management and considers how they fit within the broader concept
of relationship marketing.
Design/methodology/approach – This paper undertakes a review of the relationship marketing literature, supplemented by the authors’ on-going
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interactive research with managers.

Findings – The paper reviews alternative approaches to relationship marketing, reflects on the development of the field of relationship marketing
and identifies three critical priorities for future research in relationship marketing.
Practical implications – The research priorities that are identified in this paper represent important priorities for scholars, managers, regulators
and policy makers.
Originality/value – Although there is now a substantial body of research on relationship, marketing, much of this work focuses on the
customer-firm dyad, with a smaller body of work focusing on a broader range of stakeholders. This paper argues for the broadening of the role of
relationship marketing to consider ecosystems; the need for firms to shift from a value-in-exchange to a value-in-use perspective when addressing
customer relationships; and the critical need to address “dark side” behaviour and dysfunctional processes in relationship marketing.
Keywords CRM, Co-creation, Relationship marketing, Stakeholder, Customer management, Ecosystem
Paper type General review

“The farther back you can look, the farther forward you are likely to see”. great interest amongst scholars. The rise of relationship
–Sir Winston Churchill
marketing since then was not so much a discovery as a
rediscovery of an approach that has long proved to be the
Introduction
cornerstone of many successful enterprises. The first academic
When an important concept has been the subject of study by text book on relationship marketing was published in 1991
scholars for a substantial period, it is timely to undertake an (Christopher et al., 1991), and the first practitioner book was also
assessment of its contribution. Relationship marketing has now published that year (McKenna, 1991). By the mid-1990s,
grown up. It is over three decades since a conference publication relationship marketing was receiving increased visibility, in terms
at an American Marketing Association services marketing of marketing practice and academic research, after being “on
conference (Berry, 1983) and an influential paper in the Harvard marketing’s back burner for so many years” (Berry, 1995,
Business Review (Levitt, 1983) started to capture the imagination
p. 237). With an increasing number of scholars undertaking
of scholars and practitioners. It is now appropriate to reflect on
research in relationship marketing, it was not surprising that
both the past history and future prospects for relationship
different themes and foci were starting to develop. These
marketing. We offer a personal reflection on relationship
different perspectives were recognised by Coote (1994), who
marketing, a field that has had a strong influence on our work
and that of numerous scholars. characterised three approaches to relationship marketing
The study of relationship marketing originated in the areas of (Figure 1).
industrial marketing (Levitt, 1983) and services marketing Two of these approaches, Anglo-Australian approach
(Gummesson, 1977; Grönroos, 1983). However, Berry’s (1983) (Christopher et al., 1991) and the Nordic School (Gummerus
use of the specific term “relationship marketing” was what raised and von Koskull, 2015), had much in common. By contrast, the
North American approach (Sheth and Parvatiyar, 1995)
emphasised dyadic relationships between supplier and customer
The current issue and full text archive of this journal is available on
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in the context of the organisational environment. Although

Journal of Services Marketing

31/1 (2017) 11–15
© Emerald Publishing Limited [ISSN 0887-6045] Received 4 November 2016
[DOI 10.1108/JSM-11-2016-0380] Accepted 14 November 2016

11
 Relationship marketing Journal of Services Marketing
Adrian Payne and Pennie Frow Volume 31 · Number 1 · 2017 · 11–15

Figure 1 Broad approaches to relationship marketing

Anglo-Australian approach to Nordic approach to relationship
relationship marketing marketing

Multiple stakeholders & quality management Interactive network theory

Services Customer Services Customer

marketing relationship marketing relationship
concepts economics concepts economics

Relationship marketing Relationship marketing

North American approach to relationship marketing

Organisational Relation-
environment ship Buyer
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manager

Source: Adapted from Coote (1994)

Coote’s typology of alternative approaches to relationship in many areas, including increased computer power, more
marketing is not complete, it is useful in highlighting the different affordable data warehouses, availability of “big data” and
foci that were developing. advances in internet infrastructure have collectively
influenced what managers can do to develop and enhance
Growth and maturing of the field relationships. In particular, the increased ability to use
From the second half of the 1990s, work on relationship information technology to generate customer insights and
marketing started to grow substantially. As the relationship apply these insights in relationship marketing programs led
marketing literature continues to develop, Sheth (1996) to the rise of customer relationship management (CRM).
argued that the domain of relationship marketing should be Whilst the two terms – relationship marketing and CRM –
limited to include only those collaborative marketing are frequently used interchangeably, it is important to
activities that are focused on serving the needs of the recognise how CRM fits with relationship marketing. In
customer. In contrast to this view, many other scholars Figure 2, drawing on Frow and Payne (2009), we clarify the
argued that relationship marketing should encompass a distinction between the concepts of relationship marketing,
much wider range of stakeholders (Christopher et al., 1991; CRM and customer management.
Morgan and Hunt, 1994; Gummesson, 1999). Since then, The past decade has continued to see a substantial rise in
this broader perspective of relationship marketing has scholarly interest in relationship marketing, as evidenced by
progressively gained ground. a dramatic increase in Google Scholar publication counts of
Over the next 15 years, since the start of the millennium, references to relationship marketing, as shown below:
there has been considerable further advancement in the
1985 up to 1995 794
field of relationship marketing. This period marked a
substantial rise in applying the use of technology to 1995 up to 2005 12,700
managing customer relationships. Technological advances 2005 up to 2015 34,200

Figure 2 Relationship marketing, CRM and customer management

Relationship Marketing:
Strategic management of relationships with all
relevant stakeholders. These include not only
customers, but also suppliers, influencers,
referral sources, internal markets, etc.

CRM:
CUSTOMER RELATIONSHIP
CRM Strategic management of relationships with
MANAGEMENT MARKETING customers, involving appropriate use of
technology. Technology is an important
enabler but not the main focus.

Customer Management:
Implementation and tactical management of
customer interactions involving aspects such
as Campaign management, call centre
management, sales force automation, etc.

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 Relationship marketing Journal of Services Marketing
Adrian Payne and Pennie Frow Volume 31 · Number 1 · 2017 · 11–15

This level of scholarly interest confirms that relationship Relationship marketing: from value-in exchange to
marketing remains a growing area of importance within the value-in-use
field of marketing. The second research priority we highlight relates to
co-creation of value and the shift from value-in-exchange to
value-in-use. Over the past two decades, there has been a
Zooming out towards the future of relationship progressive shift from considering customers as “passive
marketing audiences” to appreciating them as “active players”
While there are a number of contenders, we highlight three (Prahalad and Ramaswamy, 2000). This transformation has
research priorities that we consider to be especially important important implications for relationship marketing as
to relationship marketing’s future progress: perceptions of value shift from “value creation through
1 the transition from dyads to stakeholders to ecosystems; exchange” to “value creation through use”. Changes in the
2 the relational opportunities that arise in the transition market environment represent substantial opportunities to
from value-in-exchange to value-in-use; and build and enhance customer relationships through
3 the need for collective action to address the endemic dark co-creation. Suppliers can seek to build closer relationships
side behaviours that have arisen through the inappropriate through opportunities provided by technological
use of relationship marketing and CRM. breakthroughs, changes in industry logics and changes in
customer preferences and lifestyles (Payne et al., 2008).
We consider these areas are representative of where the field of
With these changes, firms need to shift from a
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relationship marketing should “zoom out” (Moss Kanter, 2011).

unidirectional perspective of viewing customers as largely
passive receivers of value to ones where they can more
Broadening relationship marketing: from dyads to actively engage in mutual value co-creation. The
stakeholders to ecosystems contemporary view, which is now becoming more widely
For too long, the mainstream marketing literature and much of acknowledged, is that “value-in-use” is co-created (Vargo
the relationship marketing literature have neglected the and Lusch, 2008). Hence, co-creating value-in-use in a
importance of building long-term relationships with other stakeholder “joint sphere of responsibility” (Grönroos and Voima,
groups, as well as with customers. In contrast to the research that 2013) becomes the concern of both customer and firm and
has dominated much of the North American approach to is one that is critical to strengthening customer–firm
relationship marketing, there is now a growing consensus that a relationships. Value-in-use seeks the active participation of
relational focus on the customer-firm dyad should be extended to the customer in resource-sharing and contributing and
the network of stakeholder relationships (Gummesson, 1999; enhancing relational outcomes.
Payne et al., 2005). Developments in digital, mobile and social We argue that relationship marketing research that
technology are impacting not only the dynamics of the customer– focuses on understanding how to create ongoing
firm relationships but also the firm’s relationship with all its value-in-use, rather than considering just how to build
stakeholders. As a consequence, discussions about the firm, its relationships, represents a further key priority. Within
brands, its product and service offers and its customer service business markets, a broader focus is needed than focusing
experience performance are now instantly available to a much on managing relationships with direct customers to
larger number of stakeholders, whose relationships may be highly considering the customer’s customer. This is especially
important to the firm’s future success. As Payne and Frow (2013, important in intermediated markets. Relationship
p. 157) note: marketing initiatives will be substantially enhanced where
The traditional model of creating carefully-crafted centrally-controlled positive the supplier firm places much greater emphasis on helping
messages and images for stakeholders and communicating these at regular and their customer’s customer create value-in-use.
strategic intervals has gone. Instead, there is also organic and spontaneous
commentary - and even activism - unfolding in real time.
Over time, interest in stakeholders has progressively developed “Dark side” behaviours and relationship marketing
from networks (Snehota and Håkansson, 1995) to stakeholders The final important area for future research that we draw
within market domains (Christopher et al., 1991) to a wider attention to relates to “dark side” behaviours in relationship
consideration of relationships (Gummesson, 1999) and, more marketing. Historically, relationship marketing has been
recently, to ecosystems. Markets are becoming increasingly proposed as a “good thing”. Much of the relationship marketing
complex, and we content that relationship marketing managers literature extols the benefits from adopting a relational approach
need to consider the broader implications of the ecosystem in to customers (and, where appropriate, other relevant actors).
which they operate. An ecosystem can be considered at four However, much less attention has been directed at instances of
levels: micro, meso, macro and mega (Gummesson, 1999), with poor application of relationship marketing and deliberate or
each level dynamically linked to the other levels. The ecosystem unintentional behaviour that damage customer relationships.
construct makes relationship marketing interdependencies more This is a topic that has been substantially under researched, and
explicit (Adner and Kapoor, 2010). Academic research and there is evidence that dark side behaviour is widespread and may
managerial practice needs to extend their considerations of even be growing. There are many instances of such dark side
immediate customer–firm relationships to encompass a much behaviour (Frow et al., 2011; Nguyen et al., 2015). For example,
broader range of collaborative relationships within the ecosystem, McGovern and Moon (2007, p. 80) call attention to the many
which will have an important impact on the well-being of the companies that infuriate customers by deliberately “binding
firm. them with contracts, bleeding them with fees, [and] confounding

13
 Relationship marketing Journal of Services Marketing
Adrian Payne and Pennie Frow Volume 31 · Number 1 · 2017 · 11–15

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