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Mapping the re-engagement of CRM with relationship marketing

Darryn Mitussis
Nottinham University Business School, Nottingham, UK, and

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Received May 2004 Revised April 2005

Lisa OMalley and Maurice Patterson

Department of Management and Marketing, Kemmy Business School, University of Limerick, Limerick, Ireland
Abstract
Purpose This paper aims to reframe and enhance the relationship marketing literature through advocating an emphasis on process and a renewed commitment to social and informational exchanges. Design/methodology/approach The paper is conceptual. It takes as its starting-point the recognition that customers exist in complex dynamic systems in which they enact multiple roles. However, current implementations of customer relationship management (CRM) typically only view customers through a single lens (as customers) that denies rms a holistic view of those with whom they interact. Moreover, CRM systems typically embed and script actions (i.e. call centre options, offers driven by cross-selling and segmentation) rather than enabling rich communication and facilitating appropriate responses that emerge from that communication. It is argued here that, as a consequence, both parties to a relationship need to negotiate the nature of systems that connect them, because those systems, in part, determine the content of relationship exchanges. Practical implications Understanding of the central argument will contribute to better organisational-customer interactions and more informed relationship management techniques. Originality/value The paper argues for a renewed emphasis on processes and on social/informational exchanges within those relationships. This initiates a process of frame restructuring that will benet RM. Keywords Customer relations, Relationship marketing, Communication technologies Paper type Conceptual paper

European Journal of Marketing Vol. 40 No. 5/6, 2006 pp. 572-589 q Emerald Group Publishing Limited 0309-0566 DOI 10.1108/03090560610657840

Introduction The relationship marketing (RM) literature is a theoretically, ideologically and empirically rich documentation of marketing practice beyond the mass-market focus of the mainstream marketing literature. Originating in the late 1970s on the edges of marketing practice (i.e. services, business-to-business, channel management), by the end of the 1980s RM was being proposed as a solution to some of the problems faced by mass marketers (see Dwyer et al., 1987). The 1990s represented the golden years for RM, as evidenced by the increasing academic and practitioner attention afforded to it. Indeed, it might be argued that mass marketers attempted to obtain ownership of RM from their colleagues in services, industrial and channel contexts through the formulation and propagation of customer relationship management (CRM) as a mass marketing strategy or tactic. While, in principle at least, CRM is inuenced by the richness of RM, its almost exclusive focus on managing relationships with the end customer (as opposed to relationships with suppliers, competitors, intermediaries, etc.) may be somewhat

counterproductive. We say counterproductive because most of the interaction that occurs with respect to a product or service in the mass-market happens within the channel and, as such, CRM deployments fail to inuence many relevant exchanges within the network. Moreover, the management of supposed relationship outcomes, rather than relationship processes, must make it difcult to achieve those outcomes. Perhaps not coincidentally, despite the extensive time, money and technology devoted to CRM, results have been disappointing (Johnson, 2004; Kale, 2004) and many managers are now sceptical or hostile to CRM deployments (Patron, 2002; see commentary in McNulty et al., 2003). To address this general issue in more detail, we undertake the following. First, we review briey the rationale behind RM. Second, we outline the nature of CRM and critique its partial appropriation of the ideology and concepts of RM. Third, we identify and explore some problematic issues in the narrow treatment of CRM by focusing on the failure within CRM to understand that consumers are parts of complex, dynamic systems. Fourth, we argue that, in consumer markets, marketers need to re-engage with the RM ideal to prevent its ideological and conceptual richness being lost. In doing this, we clearly share the view of others (e.g. Fournier et al., 1998) that CRM, as it is currently envisaged and enacted, risks a premature death. As such, we advocate an increased focus of the processes of engagement, which are themselves the desired outcomes of relationships and not instruments for achieving something else as CRM deployments typically presume. We also acknowledge that in many cases consumers do not want relationships with particular rms or that rms do not have the relationship experience and expertise to enact successful RM programmes. In such cases, improved execution of mix management programmes would seem to be most appropriate (e.g. OMalley and Mitussis, 2002). Relationship marketing The ideological appeal of RM has rarely been questioned and has regularly been appropriated in various calls to arms to instigate paradigm shifts in the theory and practice of marketing (e.g., McKenna, 1991; Blattberg and Deighton, 1991; Shani and Chalasani, 1992; Gronroos, 1994; Hakansson, 1982; Morgan and Hunt, 1994). Traditional marketing, it has been argued, has failed in that (despite the extensive rhetoric) customers have been put last, not rst (Brownlie and Saren, 1992; Desmond, 1997; OMalley and Patterson, 1998). This inherent lack of customer focus on behalf of organisations led many consumers to conclude that organisations generally over-promise and under-deliver (Sisodia and Wolfe, 2000; OMalley and Prothero, 2004). This has earned marketing and associated public relations activities a much-maligned image as instruments of corporate manipulation (Fitchett and McDonagh, 2000). RM was positioned in such a way as to address this poor image directly by instigating a fundamental transformation in the practice of marketing. It heralded a distinct move away from customer manipulation and toward genuine customer involvement becoming, in the process, a champion of corporate credibility (McKenna, 1991). Moreover, such a transformation would also increase both the efciency and effectiveness of marketing by bringing the customer into a cooperative partnership with the organisation (Sheth and Parvatiyar, 1995; Gordon, 2000). Rather than competing on economies of scale, as had been the norm, organisations could leverage these relationships and compete on economies of scope (Gordon, 2000).

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Moreover, the practice of RM would lead to greater value creation through cooperative and collaborative relationships, with this value beneting all parties engaged in the relationship (Tzokas and Saren, 1997; Parvatiyar and Sheth, 2000). At its most basic then, the ideological grounding of RM is simply that cooperation is better than conict and that mutual benet is more valuable than greed. Complexity of relationship processes In order to achieve this transformation in marketing practice, an equally momentous transformation is necessary in terms of how marketing as a discipline is viewed. Gummesson (1994, p. 12) successfully captures this new understanding through his denition of RM as marketing seen as interactions, relationships and networks. This demands a more holistic approach to theory and methods to explore and understand how markets work, how companies interact, and how relationships are created (Berry, 1995; Wilson, 1995; Ford, 1997). Once it was acknowledged that companies are naturally involved in a whole host of relationships with employees, suppliers, competitors, non-prot organisations, distributors, retailers and consumers (Hakansson, 1982; Morgan and Hunt, 1994; Gummesson, 1997), a radical shift in the conceptualisation of marketing was required. Moreover, each of those parties is also involved in a complex array of relationships with other parties, each of which can have an impact on the nancial success of any given relationship within the network (Hakansson and Snehota, 1995). Attempts to understand the nature and content of these diverse relationships have necessitated the development of a new language that appropriately and adequately describes them. As a result, the RM literature draws largely upon insightful theories and concepts from social exchange theory (i.e. following Blau, 1964) and upon a rich qualitative research tradition (Moller and Wilson, 1995). In addition to observations of the complexity and interdependence of relationships occurring within networks, the RM literature also highlights the multidimensionality of relationships. For example, Cannon and Perreault (1999) indicate that relationship exchanges occur in multiple dimensions (e.g. informational, nancial, social, legal, etc.). Importantly, a willingness to engage in information exchanges about deeper processes and a willingness to adapt processes as a result is evident in relationship exchanges (see Wilson, 1995). Relationship outcomes In the preceding section we highlighted briey the complexity of relationship processes. In addition to the observation of these processes, a number of concepts have emerged to describe successful exchange relationship outcomes, including trust, commitment, mutual goals, shared values, intimacy and loyalty (Hunt and Morgan, 1994; Berry, 1995; Wilson, 1995; Ford, 1997). Moreover, when faced with high levels of uncertainty (such as in underdeveloped markets or in the face of enormous choice), developing a network of committed, trustful relationships with parties that share the same goals may be an end in itself. By their very nature, concepts such as trust and commitment encompass the ideological values of RM and reinforce its moral and ethical imperatives. Furthermore, the focus upon developing relationships that go beyond purely economic bonds also makes sound nancial sense because relationships that are underpinned by social and structural bonds are less easily imitated by competitors, and therefore lead to sustainable competitive advantage (Morgan, 2000).

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Relationships in consumer markets While the RM literature is quite categorical that customer relationships are only one of the many possible or actual relationships in which companies are involved, there has been a disproportionate amount of time, money and effort expended by marketers in attempting to create and manage relationships with the end consumer[1]. Perhaps this is a reasonable outcome given marketings traditional focus on the customer, together with typical understandings of the economics of customer retention (Reichheld and Sasser, 1990; Reichheld, 1996; cf. Reinartz and Kumar, 2000). Thus, by the late 1990s, mainstream marketing appears to have limited its interest in RM to those aspects that deal specically with end consumers. In essence, mainstream marketing bought into the conceptual outcomes of RM but not the ideology that drives the multidimensional exchange processes within complex networks that can lead to those outcomes. Because RM outcomes have been divorced from their direction-giving ideology, the issue of implementation (how to actually do RM in mass markets) is generally the most problematic aspect of CRM. This is because approaches to implementation are context-specic and are contingent upon the nature of the focal relationship (e.g. interpersonal, business-to-business, service or mass market). Indeed, there has been much discussion of the problematic nature of RM implementation in mass markets due to the distance between customer and supplier, the limited opportunities for interpersonal interaction, the absence of intimacy, a limited understanding of the motivation of consumers to participate in exchange relationships, and the requirement to use technology (Barnes, 1994, 1995; Christy et al., 1996; Sisodia and Wolfe, 2000; Smith and Higgins, 2000; OMalley and Mitussis, 2002). Indeed, initial attempts to implement RM in mass-market contexts may have created greater distance between customers and those organisations attempting to forge relationships with them (Fournier et al., 1998). However, despite criticisms, the ideology of RM (McKenna, 1991), the economics of customer retention (Reichheld and Sasser, 1990; Donaldson and OToole, 2002) and the possibilities afforded by technological developments (Blattberg and Deighton, 1991; Shani and Chalasani, 1992; Sisodia and Wolfe, 2000) have propelled the focus on customer relationships in mass-markets, resulting in the emergence of CRM. Technological dependency of CRM The ability to develop successful customer relationships lies in an organisations ability to understand its customers, their individual preferences, expectations and changing needs. In other words, organisations need to understand real customers on an individual basis (Sisodia and Wolfe, 2000, p. 551, original emphasis) and communicate with them appropriately. The complexity of contemporary markets renders such customer intimacy difcult (Di Tienne and Thompson, 1996). As a consequence, the collection, analysis and use of information to identify, understand and meet customers needs is crucial to the successful implementation of RM in mass markets. As a result, technology, initially in the form of the database, is widely regarded as the core of CRM with data used to build a long-term connection between the company and consumer (Copulsky and Wolf, 1990, p. 17). As such, CRM can be regarded as a business strategy that uses information technology to provide an enterprise with a comprehensive, reliable, and integrated view of its customer base so that all processes and customer interactions help maintain and expand mutually benecial relationships (Zikmund et al., 2002, p. 3).

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Transaction data held in the database are overlaid with demographic, geodemographic and lifestyle data, and a range of other data sources including County Court bad debt judgments (CCJs) and the electoral register[2], to create, according to CRM rhetoric, a relatively complete picture of the customer (Evans, 1999) or, a 360 degree view of that customer. Thus, the database is positioned as the central knowledge tool for the organisation (Di Tienne and Thompson, 1996; OMalley et al., 1999; cf. Payton and Zahay, 2003) and is used to simulate indicia of intimacy and connectedness (OMalley and Mitussis, 2002). These data are used to communicate personalised service by allowing company employees access to a complete history of the customers contacts and transactions. In theory, employees are provided with the information they require to engage with customers requests effectively (Gordon, 2000; Larson, 1996; Zikmund et al., 2002). In addition to the database, other technologies have emerged with the promise of opening up new channels of dialogue, which can be customer-initiated as well as organisation-initiated. These developments include the internet, telecoms, computer-telephony in call centres, personalised web pages, chat rooms, e-mail, frequently asked questions (FAQs), tracking capabilities and web-based call centres (Turban et al., 2004). Each of these technologies promises opportunities at the customer interface to secure real-time or near real-time interaction (Gordon, 2000). This has resulted in a need to move beyond the customer database as the basis of CRM and to link the central information centre with call-centre software and internet systems that allow direct interaction, as well as into other functions that contain histories of customer interaction (such as accounts and product service departments). Process versus outcome orientations in CRM The implementation of CRM has, however, not been unproblematic. While CRM has clearly attempted to foster the outcomes observed in good RM practice, concepts such as trust, commitment, mutuality, promise keeping and dialogue (Gronroos, 1994) have not been internalised, resulting in a lack of sincerity (OMalley and Mitussis, 2002). Often, database marketing is little more than manipulation of consumer data in ways intended to create an illusion that the provider is presenting a customised response to an individual consumers needs. This is fundamentally an inauthentic play for a consumers attention (Sisodia and Wolfe, 2000, p. 560). Many might argue that, by ignoring the ideology of RM, CRM was always doomed to fail. While this may indeed be the case, efforts at implementation have also encountered problems. These problems are a result of the failure to adopt the holistic vision that is at the core of RM. In this regard, limitations in terms of tunnel vision relating to customers, technology and marketing decisions are highlighted in this paper. In the mass market, any synthesis of relationship, sincerity and the other presumed CRM outcomes must be enabled by technology. Unfortunately, because so many interactions between a rm and its customers occur, most need to be automated and/or scripted. Processes, therefore, become inexible and out of control of the customer facing staff, thus precluding everything but an outcome orientation and, probably, any incorporation of a RM ideology. Consolidating RM versus CRM In our brief overview of the established RM literature we noted four important themes that usefully juxtapose RM theory and practice with CRM practice. First, the RM

literature includes a distinction between ideology and concepts, where ideology is a set of principles (e.g. a commitment to a rich interactive social environment) and where concepts include some of the things we might commit to (such as trust, social exchange, multi-level interaction, etc.). Second, the CRM literature and practice has not properly engaged with the ideology of RM (i.e. attempts to use the concepts divorced from their direction-giving ideology). Third, the RM literature indicates that organisations are complex and dynamic, their exchanges altering both the parameters for any given set of dimensions and the dimensionality of the relationship itself. CRM literature and practice, on the other hand, largely presumes that consumers are dimensionally static and committed to outcomes (i.e. utility maximising through consumption) that can be achieved through better pricing, positioning, delivery, etc., of products and services. Fourth, successful relationships evolve around the integration of non-standard information and soft data that typically only happens when engaging with real people or with highly exible systems (i.e. that involves a process orientation). The noted lack of success in CRM implementations may therefore seem to stem from the failure to adopt an ideological approach to support the relationship rhetoric. In the context of the preceding discussion, CRM deployments that attempt any meaningful operationalisation of a relationship would need to acknowledge the complexity of relevant business and personal networks, the complexity of interactions that occur within them and the limited capacity to technologically synthesise those interactions. Dynamic systems, dynamic consumers Having made an important distinction between the process orientation crucial to RM success and the outcome orientation largely adopted in CRM, in this section we focus on the way that consumers are part of a dynamic system and are inuenced by other stakeholders, internal agendas and systems and issues and processes external to the rm (systematic and otherwise). Of course, such complex networks of interactions have been documented in the RM literature (e.g., Hunt and Morgan, 1994; Morgan and Hunt, 1994; Hakansson and Snehota, 1995). In addition, such interaction has been acknowledged in some of the more avant garde consumer behaviour literature (e.g. Cova, 1997; Ritson et al., 1996) and in discussions of online and brand communities (e.g. Patterson, 1998; Armstrong and Hagel, 1995; Hagel, 1999). The purpose of this section is to highlight that even if an outcome orientation in CRM is initially successful, the dynamics of consumer markets mean that a failure to systematically engage in relationship processes may lead to long-term failure. In addition, the need to interact with dynamic consumers might also require more dynamic (and hence problematic) interaction between a rms systems. This is because CRM technology inuences and is inuenced by other technologies employed within the organisation (i.e. DSS, ERP as well as attempts to engender and maintain external relationships through technology such as supply chain integration systems, call centres and web portals). Marketing and other organisational agendas The success of marketing is fundamental to the success of the organisation. Indeed, for most rms, or operational units within conglomerates, marketing strategy and corporate strategy are practically indistinguishable (Rayport and Jaworski, 2002). This understanding should lead to integrated approaches to relationships that form the RM

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ideal. However, intra-organisational rivalry between marketing and sales, between product line units and between marketing and other functions creates silos that inhibit the implementation of a RM agenda (OMalley and Mitussis, 2002). Indeed, it is telling that product line units are often identied with the division moniker (e.g. the credit card division, luxury car division, etc.), which seems to both highlight and exacerbate the very real divisions that inhibit richer understanding of, and interaction with, customers. Moreover, the absence of the RM ideology in CRM praxis means that the vision that would guide senior managers to integrate more than sales relevant data is missing. As a consequence of organisational silos and competing agendas, CRM implementations fail to live up to the relationship rhetoric. Consumers become alienated because the integrated picture about them fails to materialise or, because when it does exist, it is used only very tactically. One of the informants reported in Fournier et al. (1998) makes the point well: rms can call me at home, but I cant nd the number anywhere to contact them (p. 46). Moreover, when CRM systems do manage to cross intra-organisational divisions, they can be exploited within competing organisational agendas without consideration to either the whole customer or the whole rm. For example, a banks credit card division and its personal loan division will send invitations to the same customer offering unbeatable rates, where the credit card rate beats clearly the personal loan rate, and neither are as cheap as the offers to new customers in the banks branch windows. Such examples highlight the failure of agendas to be aligned within organisations, thereby sending mixed messages to customers. Unless agenda alignment occurs, customers will resort to their other commercial and non-commercial relationships for guidance on and supply of relevant products and services. Such activities are, of course, a normal part of consumer behaviour. However, where rms fail to manage their relationship practice properly, they risk helping consumers to initiate and/or develop stronger relationships with others. More importantly, such examples highlight the problems of being focused on outcomes rather than processes. Where rms reward specic, prot-related targets, employee behaviour will, at least, pay lip service to those targets. Targets such as new customers, prot per customer, gross margin, and so on, all serve to discourage employees from attending to the processes and values required for relationship development (i.e. rms end up using some of the conceptual outcomes expected of RM in their rhetoric but fail to support an ideology that fosters processes that gives those outcomes a real, lived meaning for their consumers). The RM literature acknowledges that customers interact with suppliers at different levels and that good internal information exchange is essential to managing these interactions (e.g. Ballantyne, 1997). CRM practice has taken this on board to the extent of trying to develop unied repositories of data on each customer. Indeed, most CRM deployments are more systems integration exercises than anything else, and suffer from the attendant issues of interface design, user expectations mismatch and so on (Payton and Zahay, 2003). CRM practice does not appear to have gone so far as to help the customer develop a unied view of the rm from the artifacts of competing organisational agendas. As such, rms have focused on the knowledge outcomes (i.e. What do we know about the customer?, What does the customer need to know about us?) and have not engaged with the processes of knowledge sharing (i.e. How does reciprocal sharing of information work?). Consumers therefore feel used by the

demands for information and the lack of obvious reciprocation or even efcient use of that information (Fournier et al., 1998). Consumers in their context A key problem with CRM is that rms fail to embed themselves within rich stakeholder networks and treat those they mix with appropriately given their multiple roles. As a consequence, rms fail to understand the extent to which they are signicant within their customers lives (see Fournier et al., 1998). As outlined earlier, RM emphasises an holistic approach to understanding the nature and dynamics of customer relationships and identies a host of actual and potential relationships in which rms are involved (Hakansson, 1982; Morgan and Hunt, 1994; Gummesson, 1997). In turn, CRM advocates a 360-degree view of the consumer. Despite this ambitious aim, CRM only recognises interactions by individuals in their role as consumers, and only within the rm. Regardless of operationalisation difculties, CRM must acknowledge that individuals interact with rms in a number of different roles. Individuals also have interactions beyond the rm that are relevant to their interaction with the rm (e.g. with family, media, friends, reference groups, competitors). Furthermore, despite the promise and potential benets of customising offerings based on knowledge of individual customers, much CRM remains focused on market segmentation: The promise of CRM technology is to dene segments that are large enough to approach with a unique marketing mix (Zikmund et al., 2002, p. 17). As a consequence, much of the practice of CRM remains rooted in the mix management paradigm (Gordon, 2000). Following from the above, CRM is by denition limited in its vision, with its exclusive focus on customer relationships. Customers, it is argued, choose continuing relationships with those suppliers that consistently offer higher value (Sheth and Parvatiyar, 1995; Ravald and Gronroos, 1996). Moreover, it has been assumed that the ability to understand and respond to individual customers needs through a rms ability to collect and use information is fundamental to creating high customer perceived value (Karlenzig, 2002). However, an understanding of the impact of the full range of relationship exchanges in which rms are involved is important because each provides interaction with opportunities to create or lose value (see Starkey and Woodcock, 2002). While the importance of traditional measures of value (such as price and quality) are seen to be inuenced by supply chain activities as well as by marketing activities, there is a growing recognition that there are also other inuences on customer perceived value (Payne and Holt, 2001). For example, the behaviour of organisations within the supply chain is increasingly inuential in consumers choice amongst competing products and services (i.e. based on issues such as work practices in the supply chain, ethical and legal sourcing of raw material, etc.). This has led to greater recognition of a need to create, manage and maintain a viable corporate image which impacts not just upon product quality, brand recognition and the like, but one that also creates a moral and ethical imperative that consumers and other stakeholders can understand. At a single stroke this demands greater transparency in organisational activities and elevates the requirement for centralised control of, and response to, those activities. This highlights a fundamental difference between RM organisations and most CRM tactics. Successful RM requires a large degree of process transparency (OMalley et al., 1997) that allows customers to understand not just the

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outputs of the rm, but how and why those outputs are produced. Delivering process transparency can have a substantial impact on the marketing strategies adopted by organisations. There is also increasing recognition that those marketing strategies have, in turn, a profound impact on corporate image. In an environment where the marketing department and its personnel are already under considerable pressure to perform (OMalley and Patterson, 1998; Rowe and Barnes, 1998; Sisodia and Wolfe, 2000) and, in some cases, to justify their very existence, this realisation increases their vulnerability in quite signicant ways. Despite the sophisticated technology being utilised, many companies still fail to get it right. For example, American Express credit card customers were showered with promotional brochures and telephone contacts from numerous different sales staff, each from different product groups and departments. This was not only excessively costly and wasteful to the company, but was also inconvenient for customers and resulted in negative rather than positive associations with American Express (Buss, 1999). An important consequence of beginning to see customers in their context is that, in relationship terms, the importance of any one rm or brand is probably seen to be rather negligible. Consumers probably have much stronger and more important relationships with many other parties (e.g. family, friends and, maybe, a small number of signicant organisations, such as school or university, employer, sports club or team). For most consumers it would seem that there is little motivation or emotional energy left for more relationships (OMalley and Tynan, 2000; Smith and Higgins, 2000). Moreover, where there is motivation for relationships, in stark contrast to RM practice, most mass marketers deploying CRM only try to build relationships within narrow (non-negotiable) parameters and then only to exploit those relationships. As such, it is unsurprising that consumers fail to respond to rms relationship pitches. CRM and other information technology systems There is no question that CRM solutions are essentially implemented as technology solutions. Indeed, the dependence upon technology is such that CRM is most readily thought of as an exercise in technology implementation (OMalley and Mitussis, 2002). As such, problems of specication, valuation, sourcing and implementation that are typical in information technology projects (e.g. Willcocks et al., 1997; Wilson et al., 2002) are likely to be present in CRM initiatives. In mass markets, information technology is absolutely essential to manage the huge difference between the number of employees in a rm and the number of customers. Thus, when an RM ideology is present, information technology might become an agent of surrogacy to be enlisted to help marketers to re-create the operating styles of yesterdays merchants (Sisodia and Wolfe, 2000, p. 526). However, in the absence of an appropriate relationship ideology, IT becomes only a tool for signaling a misplaced or insincere desire for a relationship while exploiting information asymmetries and customers goodwill. It is useful here to make the distinction between three different roles for technology where that technology becomes an actor in the networks of consumers and rms (i.e. following actor network theory generally; e.g. Law and Hassard, 1999). First, technology might be incidental to interactions between rms and consumers. When technology is incidental to interactions it neither determines nor inhibits relationship development and maintenance (e.g. an alarm that wakes us in time for a breakfast meeting). Second, technology might facilitate interaction between rms and

consumers. When technology facilitates interaction it can play a role in relationship building and maintenance (e.g. the use of a computerised diary to keep reminders of promises we intend to full and the use of telephones and computers to mediate communications). Finally, technology might determine interaction between rms and consumers. When technology determines the interactions it probably does not help build and maintain relationships (e.g. when all interaction with a rm must go through a call centre that scripts employees to work in particular ways and when the CRM system controls product offers to be mailed to a customer). This nal role can be linked to a philosophical tradition that understands the way in which structures (systems and processes) help create the basis for their own replication (i.e. structuration theory, following Giddens, 1984). Because the ideological basis of CRM (as opposed to RM) demands that customer control be circumscribed, technology systems that limit, or only enable to a limited degree, communication between the rm and consumers are desired. Of course, even if the way that a consumer can use a technology to interact with a rm is prescribed by the rm, that does not necessarily mean that the way the technology will be used by the consumer is determined (generally, see Orlikowski and Robey, 1991; DeSanctis and Poole, 1994; Orlikowski, 2000). For example, rms try to lower the cost of customer interaction by constructing websites and call centres to direct consumers in particular ways. Websites can only be used to answer questions that the rm has decided can be asked. Call centres limit interaction to themes or issues that can be dened in certain categories. If such direction clashes with consumer expectations then consumers may react in ways contrary to the rms interest. Yet it is the information exchange precluded by these systems that is probably most relevant in answering questions about the structure that such systems should impose on consumers. An important consideration, therefore, when examining the role of technology and other information systems in determining the nature of the interactions, is the extent to which it precludes integration of information into the rm that has not been specically catered for in the design of the information systems. As we noted in the sections above, successful relationships evolve around the integration of non-standard information and soft data (and that this can happen when there are strong interpersonal or social exchanges). CRM systems therefore appear to have severed the dynamic between rms and their customers, and, in the process, formalised interaction around limited sets of information exchange and lost considerable richness. CRM systems are determining the nature of relationship exchanges (and, perhaps, destroying them in the process) rather than facilitating their development. Moreover, disparate business processes and systems, compounded by the proliferation of customer contact points and channels, have created incomplete and disconnected views of customers (Chan, 2005, p. 32). Thus, in many ways, CRM technologies undermine rather than underpin customer relationships. Re-engaging with the relationship marketing ideal If we are going to make CRM work we need to re-engage with the RM literature and emphasise process rather than engage with the consumer behaviour literature (in the hope of better managing outcomes), because the RM literature provides guidance on the broad structures for developing a grounded understanding of consumers. The

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consumer behaviour focus on predicting and managing behaviour without engagement is, in fact, the antithesis of relationship development, because when in relationships we have an ideological disposition to interactive engagement and learning. The difference between the two approaches becomes manifest when we see that a focus on behaviour results in the enacting of two very different agents the individual and the large corporation. It would seem impossible to sustain the ontologisation of a large organisation as an individual that behaves in ways that a single individual can manage. On the other hand, if we focus on the various structures that enable exchanges of all types (i.e. social, informational, nancial, etc.) as a principle, a shared ideological basis to interaction (i.e. one directed to the processes) can develop. Understanding and specic action can then follow. In the following three subsections we make managerial prescriptions that follow from the understanding of RM and the failures of RM documented above. Embedding process versus embedding outcomes The preceding discussion has emphasised the need to focus CRM practice on relationship processes, rather than on the presumed outcomes of relationships as proxies for those processes (see Plakoyiannaki and Tzokas, 2002, as an example of a CRM conceptualisation with a process emphasis). Given this, CRM must be an orientation adopted by the whole rm and therefore is not incompatible with the notions of market orientation. In rms that practise CRM the important role of non-marketing staff highlights this rm-wide orientation (e.g. Gummesson, 1987). As such, CRM must be integrated fully within the rm, and not simply appended to marketing communications or sales management programmes (Yau et al., 2000). Technology can assist with many of the information and transactional exchanges that occur within commercial relationships. However, many mass-market rms have no expertise or experience in creating exchanges in the other dimensions, such as legal negotiations rather than specied terms and conditions, social exchanges, process adaptation and shared goal development (OMalley and Mitussis, 2002). Moreover, even with the support of technology, and presuming appropriate expertise, these more sophisticated types of exchange that both distinguish relationships and demand process exibility might simply be impossible to implement if the economic benets of mass production of goods and services are to be maintained. The point here is that the RM literature very clearly demonstrates the importance of a rich, process orientation as the basis of a multidimensional understanding of relationships and relationship exchanges. Unless rms re-engage with this tradition (at least conceptually) they will have no sound basis to determine how much of the relationship ideal can be implemented. Of course, it could be that very little of the relationship ideal as practised in industrial markets and high-contact service markets can be implemented in the mass market. In such cases, a re-engagement with the RM tradition will help evaluate whether or not any of the insights borrowed from RM can result in something that can reasonably be dened with the word relationship, and therefore help prevent staff and consumers from presuming the existence of processes that the rm cannot deploy. Supporting the social versus exploiting the social A useful distinction can be made between attempts to deploy relationship concepts in mass markets and RM. In CRM deployments social or emotional engagement is

exploited for nancial gain, whereas a theme in RM practice is that the creation and maintenance of the social might be as important as the creation and maintenance of nancial transactions. This view is also strong in the guanxi literature (e.g. Yau et al., 2000; Luo et al., 2004), which considers relationship building in Chinese societies. This observation would seem to be just as pertinent in the consumer space. Recent literature notes that in response to the disruption of traditional societies, people look to create new social spaces. Sometimes this is directly linked to their consumption habits and sometimes it is not. The notion of the neo-tribe (i.e. following Cova, 1997) highlights that people often seek new social linkages (i.e. the development of social relationships) that might be centered on a shared consumption interest. While the value created by networks of consumers has been acknowledged, it is typically suggested that these networks exist only for their information value (e.g. Armstrong and Hagel, 1995; Hagel, 1999) and the value of the social capital generated through interaction is ignored. Even casual analysis of online communities highlights that much of the contribution to them is not specically about facts and opinions relating to the products or brands providing the infrastructure for the community (see Muniz and OGuinn, 2001). Instead, much of the contribution is of the kind of chit-chat that is the glue of many social networks. Less casual observation bears out this position (e.g. Latour, 1996). The importance of making the link between online communities and social networks is that rms can provide the infrastructure and perhaps even some of the symbolic resources to support social exchanges. The issue that they must address carefully is the extent to which they manage to insinuate themselves within those networks so that their commercial activities can support them. Here we are making the distinction between providing the infrastructure for social exchanges, providing (probably accidentally) some of the symbolic resources to facilitate social exchanges and creating protable products and services that support those social exchanges. Information technology facilitated relationships The nal theme is that information technology should facilitate relationships rather than structure or determine them. We provided a sense of this potential by acknowledging that many rms already provide the infrastructure for social exchanges. Typically, we might think of this as online discussion groups and so on (of course more primitive technology such as the bar or coffee shop, telephones and e-mail also facilitates relationships). In such a view, key lessons from the RM literature should be heeded. Importantly, these include enabling both parties to a relationship to negotiate the nature of systems that connect them because those systems, in part, determine the content of relationship exchanges. In addition, both parties must be prepared to make adaptations in their internal systems to facilitate exchange (see Wilson, 1995; Cannon and Perreault, 1999). Given the view that facilitation rather than determination of relationships is important, perhaps we should not be developing CRM systems, but rather more general relationship facilitation (RF) systems. The de-emphasis of the term management is not accidental. Such systems would support relationship processes rather than deliver specic messages, specify parameters within given product matrices, and so on. For many organisations, such systems may well be extensions of existing knowledge management systems that either serve as a repository for an organisations knowledge or facilitate the location

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and connection of members of the organisation with required knowledge (e.g. Hansen et al., 1999; Massey et al., 2001). Online communities take this notion of facilitation a step further and deploy their technology to facilitate relationship development between customers rather than only between the rm and a customer. Conclusions, forward to the past In this paper, we have sought to carefully identify some of the failures to apply the insights of the RM literature to the practice of CRM. We note three important points. First, rms seem to forget that although they are in business to make prot, consumers are in life to live. This difference sets up an important tension that makes relationships a difcult concept to enact. Firms need to focus on the broader issue of process, rather than the narrow diametrically opposed issue of outcomes. Second, consumers seem to react badly to attempts to either exploit social connections or merely signal relationship intentions for prot. They are becoming increasingly cynical about the use of relationship rhetoric (OMalley and Prothero, 2004) without serious attempts by rms to facilitate the social capital development that such rhetoric suggests. Finally, while we acknowledge that information technology is absolutely essential to sustaining any sort of interaction between rms and consumers in mass markets, there must be a distinction between technologies that are merely incidental, and those that facilitate or determine the nature of interaction between rms and consumers. Where this technology serves to structure employees and consumers interactions and prevents the incorporation of nonstandard and soft data into a rms processes, it is likely to hinder relationship development. The discussion has necessarily focused on the social dimension missing from most CRM initiatives, the general conclusion being that, in order to prevent the premature death of CRM, rms must seek to embed relationship processes, support rather than exploit social capital and use technology to facilitate rather than determine relationships. Although RM may be intuitively appealing for practitioners, the high failure rates of CRM technology testify that rhetoric is insufcient for strategy development. As such, divorcing RM from its theoretical and ideological roots serves no useful purpose. It is therefore timely to truly re-engage with the fundamental axioms of relationship marketing and to reassess the ability of CRM technologies to operationalise relational ideals. In this regard, the paper highlights a number of particular issues that can be immediately considered by interested practitioners and academics. There are also lessons to be learnt beyond CRM. In particular, although new concepts may be intuitively appealing, practitioners must be cautioned about embracing them without a full understanding of how those concepts will be used, and how their success will be measured.
Notes 1. Although we acknowledge that the earlier supply chain integration movement tried to create, manage and automate relationships between rms and suppliers, these were typically not mass-market operations (and where such systems did interface with a large market they were typically connected to a market making mechanism, rather than connected directly to the participants in the market). 2. The electoral register is a database of all those registered to vote.

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Lisa OMalley is a Lecturer at the Kemmy Business School. She has previously held positions at Nottingham University, Cardiff University and the University of Glamorgan. She has published widely in the area of relationship marketing, including a textbook and articles in the Journal of Business Research, the Service Industries Journal, the European Journal of Marketing, Marketing Theory, the Journal of Marketing Management, the Journal of Strategic Marketing, and other scholarly outlets. Her more recent research themes centre on consumption and motherhood. Maurice Patterson is a Lecturer in Marketing at the Kemmy Business School, University of Limerick. He has previously held positions at Nottingham University, Nottingham Trent University and the University of Glamorgan. His current research interests centre on the relationship between consumption and embodiment, although he has been known to write papers on marketing management, direct marketing and branding. He has co-written a textbook in the eld of direct and relationship marketing, and his publications have appeared in Consumption, Markets and Culture, the Journal of Marketing Management, Marketing Theory, the Marketing Review, and a variety of other scholarly outlets. He is on the editorial board of the Journal of Consumer Behaviour.

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