Study Notes: Customer Relationship Management (Buttle & Maklan)

Chapter 2: Understanding Relationships Source: Buttle, F. and Maklan, S. (2019) Customer Relationship Management: Concepts and Technologies, 5th edn. Routledge.

Pages 54–63: Relationship Concepts and Theories

  1. Definition and Nature of Relationships

    • Relationships are ongoing exchanges between parties with mutual recognition and benefits.

    • CRM is based on understanding, developing, and managing collaborative and value-creating relationships (Buttle & Maklan, 2019).

  2. Transactional vs. Relational Marketing

    • Transactional: one-off exchanges, short-term orientation.

    • Relational: long-term orientation, customer retention focus.

    • CRM adopts a relational approach: lifetime value and customer engagement over one-time sales.

  3. Six Market Model (Payne et al., 1999)

    • Stakeholder groups include: customer, internal, referral, supplier, influence, and recruitment markets.

    • CRM strategies should consider all six to build strong relational networks.

  4. Key Theories Supporting CRM

    • Social Exchange Theory: Relationships are maintained based on rewards and costs (Thibaut & Kelley, 1959).

    • Equity Theory: Perceived fairness drives relationship satisfaction.

    • Commitment-Trust Theory (Morgan & Hunt, 1994): Trust and commitment are key mediators in successful relational exchanges.

  5. Customer Engagement and Involvement

    • High involvement leads to stronger, more durable relationships.

    • Engagement is both emotional and behavioural—important for loyalty and advocacy.

  6. Customer Lifecycle Stages

    • Acquisition → Retention → Development. CRM aims to manage all stages effectively.

Pages 69–75: Relationship Quality and Satisfaction

  1. Components of Relationship Quality

    • Trust, satisfaction, commitment, mutual goals, and shared values.

    • High-quality relationships are predictive of customer loyalty and reduced churn.

  2. Customer Satisfaction

    • A result of perceived performance vs. expectations (Oliver, 1997).

    • CRM uses satisfaction metrics to guide service improvements and personalization.

  3. Trust

    • Defined as confidence in the partner’s reliability and integrity.

    • Trust reduces perceived risk and supports long-term relationships.

  4. Commitment

    • A psychological attachment to continue the relationship.

    • Strongly linked with behavioural loyalty.

  5. Relational Benefits

    • Includes social, psychological, and economic value derived by the customer.

    • Perceived benefits encourage loyalty even in competitive markets.

  6. Measuring Relationship Quality

    • Typically measured through surveys, feedback tools, and behavioural tracking (e.g., NPS, satisfaction scores, loyalty metrics).

Who Do We Want Relationships With? Reflections on CRM in Service Organisations

By a University of London MSc Marketing Student

Customer Relationship Management (CRM) teaches us that not every organisation requires—or even benefits from—a deep, long-term relationship with its customers. Some interactions are best kept transactional, while others thrive on mutual investment and trust. Drawing from Buttle and Maklan’s insights on relationship quality, commitment, and engagement, I’ve reflected on five types of service organisations I’d want to have a relationship with—and five I wouldn’t.

✅ Five Service Organisations I’d Want a Relationship With

  1. Bank or Financial Institution
    These services involve recurring interactions, trust, and sensitive data. A strong relationship ensures tailored financial advice, loyalty rewards, and confidence in security. Trust and commitment here are vital (Morgan & Hunt, 1994).

  2. Healthcare Provider or Clinic
    Consistency, trust, and data continuity matter immensely. A relationship with a healthcare provider leads to better care outcomes, faster service, and a sense of security—important relational benefits (Buttle & Maklan, 2019).

  3. Airline or Travel Booking Platform
    As a frequent traveler, I value loyalty programs, faster service, and personalized offers. The more I engage, the more benefits I receive—highlighting the value of relationship development and lifecycle management.

  4. Mobile Network or Internet Provider
    Long-term contracts and critical service delivery make relationship quality important. A committed relationship helps me secure better packages, faster resolution of issues, and customized add-ons.

  5. Streaming Service (e.g. Netflix, Spotify)
    These services use CRM to tailor recommendations and content. Engagement feels rewarding because the system learns my preferences and creates value—enhancing satisfaction and retention.

❌ Five Service Organisations I Wouldn’t Want a Relationship With

  1. Taxi or Ride-Hailing Services
    I use them infrequently and don't require emotional or ongoing involvement. I expect reliability and safety, but a transactional model works fine—relationship commitment is unnecessary.

  2. Fast-Food Chains
    While loyalty cards exist, my visits are irregular and largely convenience-driven. I don’t seek engagement or emotional investment; a simple, fast transaction suffices.

  3. Movie Theatres
    As someone who rarely visits in-person cinemas, I don’t see a need for relationship marketing. A good booking experience is enough, without the need for personalised engagement.

  4. Courier or Postal Services
    Unless I’m a business with regular deliveries, I typically use these only when necessary. I value speed and reliability, but I don’t seek a relationship—performance > engagement.

  5. Utility Providers (Water, Electricity)
    Though essential, these are low-engagement services. My main concerns are reliability and affordability. CRM efforts often feel unnecessary and even intrusive in this context.

Conclusion: Matching Relationship Depth to Customer Needs

As Buttle and Maklan (2019) explain, CRM should not be universally applied. Organisations must assess whether the benefits of relationship marketing outweigh its costs. For high-involvement, trust-intensive services, CRM creates real value. But for others, simplicity, speed, and transactional clarity win. The key is understanding when a relationship enhances the customer experience—and when it just gets in the way.

My Thoughts (Student Perspective)

This section of the chapter reinforces how CRM is not just a technical solution but a strategic approach deeply grounded in behavioural and relationship marketing theory. The emphasis on trust and commitment aligns with real-world customer behaviour—especially in service-based industries. I found the differentiation between transactional and relational marketing especially important as it helped clarify the long-term value CRM seeks to create. The Six Market Model is also practical—it shows that CRM strategies must go beyond just managing customer data and actually engage various stakeholders to deliver a cohesive experience.

References:

  • Buttle, F. and Maklan, S. (2019) Customer Relationship Management: Concepts and Technologies. 5th edn. London: Routledge.

  • Morgan, R.M. and Hunt, S.D. (1994) 'The Commitment-Trust Theory of Relationship Marketing', Journal of Marketing, 58(3), pp. 20–38.

  • Oliver, R.L. (1997) Satisfaction: A Behavioral Perspective on the Consumer. New York: McGraw-Hill.

  • Payne, A. et al. (1999) 'Relationship Marketing for Competitive Advantage', Butterworth-Heinemann.

  • Thibaut, J.W. and Kelley, H.H. (1959) The Social Psychology of Groups. New York: Wiley.

Comments

Post a Comment

Popular posts from this blog

Marketing Training Session: 1-Hour Workshop for Team

Title: Enhancing Marketing Strategy and Customer Experience Objective: To provide team members with a foundational understanding of key marketing principles, the experience economy, customer touchpoints, and modern methods for assessing customer experience, along with a case study and reflection assignment to apply knowledge. Agenda (1 Hour) Time Topic 0–5 mins Welcome & Objectives 5–20 mins Marketing Fundamentals, Experience Economy & Service-Dominant Logic 20–35 mins Touchpoints, Moments of Truth, Customer Engagement & Loyalty 35–50 mins Customer Experience Research (NPS, Mystery Shopping, Ethnography) 50–60 mins Case Study & Assignment Brief Part 1: Marketing Fundamentals, Experience Economy & Service-Dominant Logic (15 mins) Marketing Fundamentals Marketing is more than advertising or sales; it is "the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that h...
Read more

Assessment of Amazon's Customer Experience

  Assessment of Amazon's Customer Experience Greatest Strengths Amazon's website is renowned for its user-friendly design, offering a seamless shopping experience with straightforward navigation, detailed search capabilities, and an extensive product selection. The homepage presents a clear layout, providing quick access to promotions, personalized suggestions, and product categories. The intuitive navigation and organized menus allow customers to find products with minimal clicks, improving overall satisfaction. Notably, Amazon's advanced search engine efficiently handles complex searches, delivering pertinent results that can be refined by price, brand, and customer reviews. Visually, Amazon's consistent aesthetic enhances usability. A minimalistic color palette and uncluttered design prevent information overload, allowing shoppers to concentrate on product specifics. Amazon's tailored features, such as custom recommendations informed by users' browsing habits...
Read more

Developing the creative brief: Railway Safety Campaign

 Creative Brief: Railway Safety Campaign Published by Ei Myat Myat Thwe 15 May, 2024 Objective: GET young public aged 12 to 29 WHO disregarded the risks posed by conduct near trains TO become aware of those invisible risks BY increasing the awareness of rail safety Company Background: Brand Positioning: The train operator values safety, reliability, and community well-being. The company aims to promote a secure and pleasant travel experience, ensuring that all passengers and community members understand the importance of rail safety. The relationship with users is built on trust and the shared responsibility of maintaining a safe environment around railways. Target Audience: Adolescents (12-17) and young adults (18-29).   Actions Desired: Develop a video series to raise awareness of railway safety. Get our target audience to engage with the campaign by watching and sharing videos. Take and promote the rail safety pledge. Encourage public transport users to create and sh...
Read more