6 Relationship Marketing 2.6.1 Definition of Relationship Marketing RelationshipMarketing has never had one concrete definition.

Harker(1999)came up with 26 different definitions of the term. Among these 26 defintions non really included all features of relationship marketing. Grnroos is one of those researchers whose definition of Relationship Management seems more appropriate. According to him, Realtionship Marketing is to establish, maintain, enhance and commercialize customer relation-ships so that the objectives of the parties involved are met. This is done by a mutual exchange and fulfillment of promises Grnroos, (1990). 2.6.2 Evolution of Relationship Marketing Relationship marketing is one of those approaches to marketing that has been used over time. It is one of those subjects that have been studied by many scholars and researchers from different angles. It received so much attention in the 80s and continue to do so today. The emergence of Relationship Marketing as a theory can be linked back to the 70s, a period when the traditional marketing mix was criticised for not considering the two sided bond that exist between the consumer and the company, Mller & Halinen, (2000). The traditional marketing mix did not focus on the personal relationship that exist between the buyer and seller .it portrays the seller as the active party whereas the buyer as the passive party Grnroos, (1994). The absence of interest in what bonded the buyer and seller together gave birth to Relationship marketing, Mller & Halinen, (2000). As opposed to the traditional marketing mix, Relationship marketing places importance on the mutual and cordial relationship between the seller and buyer which is beneficial to both parties, OMalley & Tynan, (2000). The last decade however, has witnessed a lot of importance being attached to Relationship management replacing the traditional transactional approach of marketing. Lindgreen et al., (2001). The purpose of relationship marketing is to establish a relationship with the client from the beginning so as to please and keep hold of existing customers, while on the other hand, transactional marketing aims at making sales and finding new customers Vence, (2002). The 1990s saw the emergence of relationship marketing as an internationally accepted theory, Gummeson, (1994), a concept which Berry (1995) describe as a new-old concept. Since then, the Journal of the Academy of Marketing Science has been carrying special issues about relationship marketing.(Bejou, 1997). 2.7 Characteristics of Relationship Marketing Grnrooss (2000) classifies relationship marketing according to the following criteria 2.7.1. Long-term orientation

According to this criterion, success is measured in relation to the amount of time a customer has been in the relationship. Gummesson (1999) emphasized that lasting collaboration is an important characteristic of relationship marketing. Customers and suppliers, are seen as partners instead of competitors. This makes relationship marketing a win-win idea rather than a win-lose one because it supports partnership and enhances mutual cooperation. 2.7.2 Commitment and fulfillment of promises Relationship marketing entails a long-standing bond and neglect of other suppliers by the customer, as well as reciprocal exchange of information. This means that there has to be trustworthiness between the customer and the company with each party believing in the integrity of the other. Of particular importance is the cultivation of trust and commitment because being satisfied doesnt mean the customer will be loyal as they may want to go elsewhere to experience a change and strike a bargain. Relationship marketing depends on nurturing a relationship between the customer and the supplier which is fortified with empathy. This means that the customer and the supplier cooperate together to achieve planned goals viewing the circumstances from each others point of view. Callaghan et al (1995) 2.7.3 Customer share, not market share Gummerson(1999) proposes that the focus of Relationship marketing is keeping existing customers and trying to get as much as possible a greater portion of their wallet by ensuring that the same kinds of products are being sold to them. It is has witnessed a shift from the old paradigm of acquiring market shares and compensating employees for bringing in new businesses. 2.7.4 Customer lifetime value Suppliers need to choose carefully those customers with whom to enter lasting relationship with, those that will create an impact and bring profit to the company. Morgan & Hunt (2002) highlighted that since determining a customers life time commitment is not an exact science, companies need to test and develop ways that will determine how long a customer is like to stay with the company