JOSHUA KELLER 05/07/2012

Transformational Customer Relationships: Building Trust and Brand Loyalty by Aligning Client

and Corporate Values

Introduction

• Many organizations in financial services claim to have a focus on long-term relationships with the customer but fail to follow through (Hawkes, 1995).

• Distinction between relationship models and transactional models.

• Transaction theory seeks to increase the immediate payoff and achieve short term gains whereas relationship theory aims to build and maintain an ongoing mutually beneficial partnership.

Background of the study

Social Concern

• Relationship marketing overlooks short-term losses to build long-term gains. Relationship theory would benefit society by an increase in mutual benefits for both the customer and commercial industries rather than reinforcing the opportunistic and cutthroat approaches embodied by transactional theory.

• In time, time a short term gain hurts both whereas a long term gain helps both.

Theoretical Concern

•There is insufficient research on some issues and relationships between certain attributes of relationship marketing; especially on the correlation of these attributes between agencies who provide relationship marketing and those who do not.

•The conditions of trust development and customer need expectation need to be met for relationship marketing to exist.

Problem Statement

• Studies show that it is essential for organizations that are service oriented to create and share value with the customer during an exchange (Christopher, Payne, & Ballantyne, 2002).

• At this time it is unclear if these transactional systems are being used as an intentional alternative to a company supported relationship marketing approach.

• The problem is that even though relationship theory has been shown to be more effective in the long term success of the organization, many companies choose to not employ the approach (Bruhn, 2002, Hawke, 1995, and Barwise, 2005).

Purpose of the Study

• Quantitative correlational research study to show the relationship between trust development and expecting customer needs (independent variables) as measured by the developed research marketing tool which seeks to determine the relationship to the company’s style of marketing (dependant variable) (Morgan & Hunt, 1994).

• Population is middle management and customers of financial service company in Central CA

• Demonstrate misappropriation of training, marketing, advertisement, and management budgets.

Significance of the Study

• General

• This study is significant as it presents an empirical tool to measure trust development and expecting customer needs, two essential elements of relationship marketing.

• Leadership • Will give leaders unique tools to develop trust and meet customer needs thereby making better use of dollars for advertising and marketing, training, and customer relations budgets.

Nature of the Study

• Research methods• Quantitative method is appropriate as it shows the relationship between the independent and dependant variables.

• Research design• Design is appropriate as it will first identify a company that uses relationship marketing (by using a pilot test) and then test the independent and dependent variables. Study will then determine if the data shows a relationship between the IV and DV.

Research Questions

• How important is developing trust and expecting the needs of the customer to the patrons? To the company itself?

• Did the company achieve their goal of providing relationship marketing?

• Are trust development and needs expectorations accurate measures of relationship marketing?

Hypotheses

• Null Hypothesis

• There will be no relationship between the independent variables of development of trust and customer needs expectation and the dependent variable of the style of marketing.

• Alternative Hypothesis:

• There will be a statistically significant relationship between the independent variables of development of trust and customer needs expectation and the dependent variable of the style of marketing.

Conceptual Framework

• Relationship Theory

• Transformational and loyalty theories

• Transactional theory

• Business process management• Similar studies and related theories• Attempts to show that millions of dollars in training and management budgets are being misappropriated by lack of understanding of the full dynamics surrounding customer reaction to business-patron interactions.

Summary and Conclusion

• Questions on the customer questionnaire will be directed at the respondent’s feeling that the organization anticipated their needs and their behaviors were in an effort to build and maintain a long term relationship with the customer.

• Discussion on study’s implications and potential differences between the company and customer impression.

• Similarities will be exposed between feedback from customers and companies to determine if there are some areas that can be addressed using a BPM approach.

References

• Bruhn, M. (2002). Relationship Marketing:Management of Customer Relationships (1st ed.). Basel, Switzerland: Prentice-Hall.

• Barwise, P. (2003). Simply Better: Winning and Keeping Customers by Delivering What Matters Most. CITY PUBLISHER

• Christopher, M., Payne, A., & Ballantyne, D. (2002). Relationship Marketing: Creating Stakeholder Value. Woburn, MA: Butterworth-Heinemann.

• Hawkes, A. (1995). Relationship Marketing in the Financial Services Industry. CITY PUBLISHER

• Morgan, R. M., & Hunt, S. D. (1994). The commitment-trust theory of relationship marketing. Journal of Marketing, 58(3), 20-38.