Title

Relationship marketing developmental stages

Date of Completion

January 2006

Keywords

Business Administration, Marketing|Mass Communications

Degree

Ph.D.

Abstract

In the $40 billion customer relationship management (CRM) and services market, more than half of all customer relationship programs fail (Robinson, R., 2000; Fox, P., 2001). The problem with relationship marketing is not a lack of understanding about customer retention benefits, but rather the problem may lie in misunderstanding and disregarding the nature of relationship development. ^ The purpose of this research was to understand the stages of customer relationships. Insight into the customer experience may help relationship marketers succeed by matching strategic planning to important stage factors. ^ Hypotheses based on relationship development literature were tested on customer relationships unfolding in an awareness-exploration-growth-commitment progression. In addition, key variables---emotions, trust, satisfaction, and purchases---were investigated to see how they changed according to stage. Finally, an SEM model of the customer relationship development process was developed. ^ Results garnered support for relationship development theory in relationship marketing. The investigation of how key variables change showed that significant changes exist between stages: Trust, prosocial and reptilian emotions, satisfaction, and purchases follow an upward U-curve toward greater positive outcomes. ^ The customer relationship development model revealed paths such as growth-trust-commitment, growth-trust-satisfaction, and awareness-prosocial emotion-growth-trust-commitment-purchases. Surprisingly, the exploration stage did not progress to the growth stage and was related to individualistic emotions. Importantly, emotions appeared to act as the mechanism for stage change. Finally, the commitment stage's positive relationship to total dollars spent with the marketer (purchases), supports claims by relationship marketing. ^ The implications of this study are that relationship marketers meet customers "where they are" in the relationship stages. If relationship marketers match customer communication in depth and breadth considering the customer's stage and level of trust, relationship marketers may earn a functional, long-term, committed customer relationship. Recommendations include not only planning for stages (particularly the exploration stage), but also an inter-disciplinary consideration of sustainability, well-being, and the application of interpersonal relationship maxims. ^