Customer Satisfaction and the Meaning of
Relationship Marketing in this Context

by: Sarah Middelhoff

Table of Contents

1. A Change of Orientation 1

2. What Relationship Marketing is About 2

2.1 Relationship Marketing versus Transaction Marketing 2
2.2 Levels of Relationship Marketing 2
2.3 The Importance of Interaction 4

3. The Meaning of Customer Satisfaction 5

3.1 Customer Satisfaction as a Basis Condition 5
3.2 Benefits of Satisfied Customers 6

4. How to Keep Customers Satisfied 7

4.1 Total Quality Manangement 7
4.2 Customer Satisfaction Research 8

5. Resume 9

References 10

Bibliography 11

Why Relationship Marketing?

‘Today’s companies face tough competition and things will only get harder.’ ¹ Worldwide competitive conditions, which are taking the form of hypercompetition in a growing number of markets, have made products almost equal and simple to replace by other brands². Customers have become more sensitive for the right cooperation and care from the companies³. They are now more demanding and more sophisticated than they were for example forty years ago. No longer do they expect only the product itself, but also a good pre-sale, sale and after-sale service. As a result, it is becoming more and more accepted that there is a strong link, between customer satisfaction, customer retention and profitability. If the companies manage to meet the customers’ expectations individually, the probability of satisfied and loyal customers increases. In many companies, the shift from the Industrial Era to the Information Age and to modern database technology marks a renaissance of one-to-one relations by making it possible to remember relationships with individual customers. This paper takes a look how companies can succeed in today’s highly competitive markets by meeting and satisfying individual consumers’ and customers’ needs, which is the foundation of a loyal relationship.

1. A Change of Orientation

In present day business relations, marketing is changing from a transaction focus to a relationship focus⁴. The origin of relationship marketing goes back into the pre-industrial era. Before the Industrial Revolution the local grocer met and knew every one of his customers. Such direct interaction led to relational bonding between the producer and the consumer. With the Industrial Revolution, a new era of mass produced products and upcoming mass media resulted in less frequent interactions between producers and consumers, ultimately leading to transactions oriented marketing. Now technology has brought us back to an old-fashioned way of doing business. It has made it possible to remember relationships with individual customers, just as shop owners did with their few hundred customers 150 years ago⁵.

2. What Relationship Marketing is about

The following part of the paper will give a general idea of relationship marketing by first comparing it with transaction marketing and then looking towards the various levels of relationship marketing.

2.1 Relationship Marketing versus Transaction Marketing

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1 KOTLER, P. et al. (2001). Principles of Marketing. London: Pearson Education Limited. p. 389

2 cf. SCHARNBACHER, K. & KIEFER, G. (1996). Kundenzufriedenheit: Analyse, Messbarkeit, Zertifizierung. München: Oldenbourg Verlag. p. 15

3 cf. D´ALQUEN, K. (1997). Kundenzufriedenheitsanalyse. Eschborn: RKW. p. 7

4 cf. CHRISTOPHER, M. et al. (1991). Relationship Marketing. :Bringing quality, customer service and marketing together. Oxford: Butterworth-Heinemann Ltd. p. 8

5 cf. PEPPERS, D. & ROGERS, M. (1996). The one to one future: Building relationships one customer at a time. New York: Doubleday. pp. 21-22