The complexity of relationship marketing for

service customers
Tony Ward
Faculty of Business and Law, Central Queensland University, Rockhampton, Australia, and
Tracey S. Dagger
UQ Business School, The University of Queensland, Brisbane, Australia

Abstract
Purpose – There are a number of assumptions inherent in relationship marketing, including claims that a relationship should be developed with all
customers in all situations. This paper seeks to show that marketers should not automatically use relationship marketing techniques for all products and
for all customers.
Design/methodology/approach – This paper reports the results of an empirical survey of 287 consumers for five service products in which
consumers were asked to assess the strength of the relationship between themselves and their supplier.
Findings – Relationship strength was found to vary significantly between service products and individual customers, and the impact of duration of the
relationship and the frequency of purchase on relationship strength depends greatly on the nature of the service product. It was also demonstrated that
some customers want a closer relationship with service providers than other customers, and this aspect significantly affects the strength of relationship
perceived by the customer.
Practical implications – This paper clearly shows that the use of relationship marketing techniques for service products needs to be much more
thoroughly researched to provide guidance for practitioners and marketing theorists. The complexity of the “relationship” construct in marketing is
clearly shown and there is as yet no known set of “rules” that indicate when relationship marketing techniques should, or should not, be used.
Originality/value – The contribution of this paper is to empirically demonstrate that not all customers want to develop relationships with all service
suppliers.

Keywords Relationship marketing, Services marketing

Paper type Research paper

An executive summary for managers can be found at
the end of this article.
Introduction
The idea of building a relationship with customers in order to
earn their favour was not unknown to the earliest merchants.
Yet the creation of a conceptual framework for understanding
relationships, and studying the nature of relationships has
been slow to develop. For many years marketing’s focus was
aimed at acquiring customers, rather than retaining them
(Schneider, 1980). Although relationship marketing has been
heralded as an effective strategy to attract, maintain and
enhance customer relationships (Roberts et al., 2003; Brodie
et al., 1997; Berry, 1983; Grönroos, 1994), there is little
empirical research that has tested the underlying assumptions
upon which much of the relationship marketing literature is
based. This research tests consumers’ perceptions of the
relationships developed between themselves and the suppliers
of five consumer service products.
The current issue and full text archive of this journal is available at
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This article is organised as follows: first we review prior
theory and research relevant to relationship marketing. We
then develop a model and hypotheses to describe the
proposed relationship between our research constructs.
Next, we describe the method and present the results from
a field study of service consumers across five service products.
We conclude by discussing the findings and implications of
the research program.
Conceptual development and hypotheses
Customer retention is economically more advantageous than
constantly seeking new customers (Verhoef, 2003; Reichheld
and Sasser, 1990). Similarly, developing and maintaining
long-term customer relationships is critical to business
performance as success is often determined by the firm’s
ability to grow and maintain a loyal customer base (Verhoef,
2003; Bove and Johnson, 2000). Relationship marketing,
therefore, is emphasised as a strategy that has the potential to
induce success.
The concept of relationship marketing has attracted much
attention (e.g. Verhoef, 2003; Morgan and Hunt, 1994) as it
encapsulates a longer-term approach to marketing (Berry,
1983). As this approach focuses on the lifetime value of the
customer rather than the value of a single transaction, the

Journal of Services Marketing

21/4 (2007) 281– 290 Received: June 2005
q Emerald Group Publishing Limited [ISSN 0887-6045] Revised: November 2005
[DOI 10.1108/08876040710758586] Accepted: December 2005

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Tony Ward and Tracey S. Dagger Volume 21 · Number 4 · 2007 · 281 –290

orientation of relationship marketing is on obtaining a share of Figure 1 Preliminary research framework

the customer, not a share of the market (Peppers and Rogers,
1994). The underlying assumption being that establishing and
maintaining relationships with customers will foster customer
retention (Gwinner et al., 1998), customer share development
(Verhoef, 2003), and increased profit and recovery should a
problem occur (Barnes, 1997; Jensen, 1997; Riley and
Chernatony, 1997). Relationship marketing, therefore, has
become increasingly important as a business strategy
(Verhoef, 2003; Grönroos, 1990).
A relationship orientation implies that the focus of
marketing is on retaining customers by maintaining and
strengthening win-win relationships over time (Payne and
Frow, 1997; Grönroos, 1990; Tzokas and Saren, 1996;
Daskou, 1997; Berry, 1983). This approach implies that
relationships are more likely to develop in situations where the
customer comes in more frequent contact with the service
provider (Bove and Johnson, 2000; Barnes, 1997; Doney and
Cannon, 1997; Crosby et al., 1990), where the service is
continuously delivered over an extended time period
(Bennett, 1996; Berry, 1995) and where the customer
perceives the relationship to be important (Ward et al., 1997).
Based on the above discussion there appear to be certain
circumstances that are conducive to the formation of strong
customer relationships and that there are contrary
circumstances that detract from relationship development.
Moreover, there are a number of underlying assumptions
inherent to relationship marketing, including:
Relationship duration
.
a relationship can be formed with all customers, in all
Understanding the impact of relationship duration on
service situations, suggesting that all organisations should
relationship strength is important for two reasons. First, the
partake in relationship development;
maximisation of customer life time value is a cornerstone of
.
relationship strength will increase as the duration of the
relationship marketing (Phillips et al., 2004; Reinartz and
relationship increases;
.
the more frequent contact consumers have with a Kumar, 2003; Bolton, 1998). Second, relationship strength is
likely to impact on customer retention and loyalty and
particular service provider the greater the opportunity
ultimately on long-term profitability (Gwinner et al., 1998;
for the relationship to strengthen;
.
that customer demographic characteristics impact on Palmer and Bejou, 1994). Research has shown that strong
relationship strength; and relationships contribute to perceptions of quality, and increase
.
that relationship strength will increase more if the customer satisfaction and loyalty to the service firm (Goodwin
customer places greater importance on such relationships. and Gremler, 1996). Moreover, fostering strong interpersonal
relationships between employees and customers helps
Although reiterated throughout much of the relationship encourage positive word-of-mouth behaviour in customers
marketing literature empirical support for these assumptions (Gremler et al., 2001). As these outcomes enhance market
is lacking. The primary purpose of this research, therefore, is share and return on investment (Gale, 1994), research that
to examine whether the relationship characteristics of length examines the impact of relationship duration on relationship
and duration, the customer demographic characteristics of strength is well justified.
age and sex and relationship attribute importance, as It is also generally assumed that if a customer used the same
perceived by the customer, impact on the strength of the supplier for an extended period of time then a relationship
relationship between the customer and service provider. We existed between the two parties, that customers would have
further suggest that the nature of this relationship may be high levels of cumulative satisfaction (Bolton, 1998) and that
service specific and thus differ between high involvement and the relationship would grow in strength. It is also generally
low involvement services. The conceptual framework guiding accepted that strong relationships develop incrementally over
this study is shown in Figure 1. time (Bass et al., 1998; Bove and Johnson, 2000) and that
As can be seen in Figure 1, we suggest that customer relationship duration has a positive effect on relationship
relationship importance, relationship characteristics strength as trust and commitment increase as the relationship
(frequency of use and duration of the relationship), matures. Indeed, Dwyer et al. (1987) suggest that
customer demographic characteristics (age and sex) and relationships develop over a continuum from awareness to
type of service product will all impact on relationship commitment and ultimately to a higher stage of relationship
strength. To examine these relationships we developed bonding. This assumption has led to an emphasis on
several research hypotheses, which are discussed next. extending the duration of relationships, as long-term

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Tony Ward and Tracey S. Dagger
relationships are associated with positive outcomes (Verhoef,
2003; Reichheld, 1996; Anderson and Sullivan, 1993).
With this background in mind it becomes apparent that
attention needs to be paid to understanding when a
relationship is said to exist between a customer and
supplier. Moreover, there is a need to differentiate between
true customer loyalty and habitual buying patterns. We
therefore examine whether it can be assumed (by a service
provider) that the length of time a customer has been using
the service provided is evidence that a relationship exists. We
also investigate whether it can be assumed that a relationship
will strengthen over the duration of the supplier and buyer
interaction. While there is some precedence for suggesting
that relationship duration is a driver of relationship
commitment in buyer-seller relationships (e.g. Smith, 1998),
there is little evidence that duration impacts on relationship
strength. Thus, we study whether relationship strength
increases with the duration of the relationship:
H1. strength of the relationship, as perceived by the
customer, will increase with the length of time that a
customer has been purchasing a consumer service
product from a provider.
Frequency of service encounters
A service encounter occurs whenever a customer interacts
with a service firm. Customer relationships are developed
from these encounters as each encounter tests a firm’s ability
to keep its promises (Bitner, 1995). It is in these encounters
that the customer is witness to the firms’ quality
(Parasuraman et al., 1985; 1988), and ultimately, it is these
encounters that will dictate satisfaction and future purchase
behaviour (Bove and Johnson, 2000; Rust and Oliver, 1994;
McDougall and Levesque, 1994). To the firm, these
encounters represent an opportunity to demonstrate quality,
to build trust and commitment between the firm and the
customer, and to increase customer loyalty through
relationship building (Bitner, 1995). Thus, through multiple
service encounters relationships are developed, maintained
and enhanced (Grönroos, 1990). Research has shown that the
level of personal contact enhances the development of strong
relationships (Barnes, 1997) and that frequent interaction
fosters trust (Doney and Cannon, 1997) and commitment
(Crosby et al., 1990). We therefore suggest that the frequency
of service encounters will have an impact on the strength of
relationship between the provider and customer.
We specifically propose that when a customer utilises a
service product more frequently there are more opportunities
for a service provider to strengthen that relationship. Given
that several researchers have indicated a need for research that
considers the impact of frequency of purchase or usage on
relationship strength (Barnes, 1997; Berry, 1995)
understanding this impact is important. Thus, we examine
whether the strength of the relationship is greater when the
frequency of use of the product is greater:
H2. The strength of the relationship, as perceived by the
customer, is greater when the frequency of use of the
product is greater.
Demographic characteristics
A plethora of conceptual and empirical research focusing on
relationship marketing has emerged within the current
literature (e.g. Verhoef, 2003; Morgan and Hunt, 1994;
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Volume 21 · Number 4 · 2007 · 281 –290
Liljander and Strandvik, 1995; Barnes, 1997). Yet,
surprisingly little research has examined the impact of
demographic characteristics on relationship strength. While
there has been some research into the impact of demographic
characteristics on relationship marketing constructs, such as
relationship investment, communication, trust and
satisfaction (e.g. Smith, 1998), researchers have generally
remained quiet on the impact of demographic characteristics
on relationship strength. Thus, to examine whether sex and
age impact on the strength of relationship between a customer
and service provider we developed the following hypothesis:
H3. The strength of the relationship, as perceived by the
customer, is affected by customer sex and age
differences.
Relationship importance
In any form of relationship between customer and service
provider the attitude of the customer towards such a
relationship is likely to be of importance, thus the stronger
the customer perceives the importance of relationships in
general, the more likely the customer is to develop a stronger
relationship with the service provider (Ward et al., 1997).
While there are many potential dimensions to such a
relationship, the importance of these dimensions to
customers may impact on the strength of the relationship
developed between the service provider and customer. We
suggest that developing, maintaining and strengthening a
relationship will depend on the customer’s perception of the
importance of key relationship dimensions, namely, bonding,
empathy, reciprocity, trust, friendship, recognition,
thoughtfulness, understanding, time to listen, commitment,
loyalty, and shared values. Thus, we suggest that perceptions
of the importance of these relationship dimensions will impact
on relationship strength:
H4. The strength of the relationship, as perceived by the
customer, is affected by the customer’s perceptions of
the importance of dimensions of relationships.
Service product variation
Broad application of the assumptions discussed above may
lead to an oversimplification of the relationship marketing
construct and a belief on the part of many organisations that
they must undertake relationship marketing activities to
remain competitive. As such, any activity that is remotely
linked to increasing the customer base or retaining existing
customers is being referred to as relationship marketing,
resulting in many firms implementing programs without a
clear understanding of relationship marketing concepts and
their application to varied business situations (Barnes, 1997).
Despite the embrace of relationship marketing as an
important corporate strategy (Sheth and Parvatiyar, 2002),
it is estimated that sixty to seventy percent of customer
relationship initiatives have stalled or failed (Dyche, 2002).
While there are many organisational and structural reasons for
this, it is also likely that relationship marketing initiatives are
being applied in service settings where relationships have
limited meaning or relevance (Dyche, 2002). This research
seeks to determine how customer perceptions of the strength
of a relationship develop for different service products and
whether the strength of relationship varies significantly
between service products. We expect that stronger
relationships are more likely to develop under conditions of
 The complexity of relationship marketing for service customers
Tony Ward and Tracey S. Dagger
frequent, high involvement, extended service encounters than
under conditions of short, remote, infrequent and not
particularly involving service encounters. In support, Price
et al. (1995) suggest that during extended service encounters
there is a greater likelihood of relationship based feelings
developing than during a mere transaction. Indeed, service
encounters that are brief and not involving tend to be less
intimate and more role based than relationship based (Martin
and Clarke, 1996). Thus, irrespective of whether or not the
strength of a relationship between the purchaser and supplier
develops over time or with increased frequency, it is important
to understand how this relationship develops for different
service products.
We, therefore, examine whether the impact of relationship
and customer characteristics varies significantly between
service contexts. Due to the difficulty of addressing this
issue we pose the following as a research question:
RQ1. Is there a difference in the impact of the relationship as
perceived by the customer for service products of
different types?
Method
The research context for this study comprised five service
types, namely, doctors, hairdressers, electricity supplier,
cinema and bank. We restricted the research to five service
types to avoid respondent overload. These five service
products represent a diverse range of services, some being
presumed high involvement services (doctor and hairdresser),
medium involvement (bank) and low involvement (electricity
company and cinema), all of which would be utilised by
respondents at different times, frequencies and duration.
Thus, our sample comprised current customers of these
service types. The structured questionnaire comprised:
.
Three questions for each service product, the strength of
the relationship, the frequency of use/purchase (except for
the electricity company where the frequency question was
omitted as it was assumed people would use the product
every day they were at home), and the duration of the
relationship in years. The strength of relationship
questions used a bi-polar semantic scale from 0 to 7.
The zero was labelled as having no relationship, while the
scale items (1 “very weak” to 7 “very strong”) were used
for customers who perceived they had a relationship with
their service provider.
.
Age (in five groups from 18 to over 60) and sex.
.
A list of relationship attributes (bonding, empathy,
reciprocity, trust, friendship, recognition, thoughtfulness,
understanding, time to listen, commitment, loyalty, and
shared values) derived from the literature (e.g. McSherry
et al., 2002), and measured using a bi-polar semantic scale
from 1 to 7 (1 “not very important” to 7 “very
important”).
The questionnaire was pre-tested with over 60 interviews,
where upon respondents stated that they understood the
relationship marketing construct well enough to answer the
questions contained within the test instrument. Data was
collected in major shopping centres in Queensland, Australia.
This method of data collection was chosen as it offered a
random sample of respondents who were customers for all of
the products being investigated. The collection of a random
sample is a requirement for representativeness of the survey,
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and provides a degree of generalisability. The questionnaires
were administrated by experienced researchers and customers
were selected using a random sampling procedure. A quota
system was put in place to ensure that males and females were
relatively equally represented. In total, 287 useable surveys
were collected.
Results
Descriptive statistics for the strength of relationship,
frequency of use and duration for each of the five products
are shown in Table I. As can be seen, the mean strength of
relationship for the hairdresser, doctor and bank are all above
the mean point of the scale (5.39, 5.13 and 4.54,
respectively). The means for the electricity supplier and
cinema were much lower (4.00 and 2.66 respectively). As
would be expected, the number of respondents who rated
their relationship as zero (there is no relationship) was low for
the hairdresser (1.7 per cent), doctor (3.1 per cent) and the
bank (4.9 per cent) and high for the electricity supplier (28.9
per cent) and the cinema (26.7 per cent). On average people
visited the bank weekly, the doctor every 4-6 months and the
cinema and hairdresser every 2-3 months. The electrical
supplier was not included as it was assumed consumers used
its services everyday. The length of time consumers had been
using the services of their bank, electricity supplier and
cinema (13.51, 12.97 and 11.20 years, respectively) was
longer than the length of time they have been using their
doctor and hairdresser (8.71 and 5.79 years, respectively).
A comparison of the strength of relationship and duration
of relationship means in Table I indicates that although
consumers rated the strength of relationship with their doctor
(5.13) and hairdresser (5.39) to be stronger than with the
cinema (2.66) or electricity supplier (4.00), the duration they
had been using the services provided by their doctor and
hairdresser is shorter than for the cinema and electricity
supplier. This result does not support the body of literature
on relationship marketing, which can be read to imply that the
length of time a consumer has been using a particular service
provider has a significant influence on relationship strength.
Descriptive statistics are given in Table II in descending order
for the twelve relationship attributes, namely bonding,
empathy, reciprocity, trust, friendship, recognition,
thoughtfulness, understanding, time to listen, commitment,
loyalty and shared values. The mean importance of attributes
varied from a high of 6.24 (trust) to a low of 4.56
(reciprocity).
The twelve relationship attributes were reduced using
principal components factor analysis, using Varimax rotation
with Kaiser normalisation. The procedure advocated by
Pallant (2005) was followed. The correlation matrix
contained many correlations above 0.3, the Kaiser-Meyer-
Olkin measure of sampling adequacy (KMO) was 0.88
(comfortably above the 0.6 benchmark) and the Bartlett’s test
of sphericity was significant at 0.000. Two components were
extracted and they converged in three rotations. There was
only one cross loading dimension (thoughtfulness) that
loaded significantly on both components. This dimension
was removed and the analysis repeated using the eleven
remaining dimensions, and again all tests for compliance were
met. The resultant rotated factor matrix is also shown in
Table II. The two dimensions were labelled friendliness and
consideration. It is of interest that the commonly cited
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Tony Ward and Tracey S. Dagger Volume 21 · Number 4 · 2007 · 281 –290

Table I Relationship strength, frequency and duration

Relationship strength Relationship frequency Relationship duration
Product n Mean strength SD Zero strength % n Mean frequency SD n Mean duration SD
Bank 284 4.54 1.80 4.9 287 52 30.00 284 13.51 11.32
Cinema 208 2.66 1.98 26.9 210 3 3.47 210 11.20 10.71
Doctor 269 5.13 1.62 3.3 269 4 6.53 269 8.71 7.40
Electricity supplier 262 4.00 1.96 29.0 N/A N/A N/A 262 12.97 11.14
Hairdresser 223 5.39 1.58 1.8 225 4 2.98 224 5.79 5.56
Note: Respondents who perceived they had no relationship with a service provider (zero rating) were not included in the means

Table II Descriptive statistics and factor matrix for relationship attributes

Relationship attribute n Mean SD Rotated factor matrix Friendliness Consideration
Trust 250 6.24 1.154 Friendship 0.80
Time to listen 287 6.20 1.066 Bonding 0.71
Understanding 287 6.15 0.927 Reciprocity 0.70
Thoughtfulness 286 5.93 1.101 Loyalty 0.67
Commitment 287 5.87 1.251 Shared values 0.66
Loyalty 287 5.69 1.551 Recognition 0.52
Empathy 287 5.44 1.422 Time to listen 0.83
Recognition 287 5.26 1.395 Commitment 0.78
Bonding 287 5.02 1.575 Understanding 0.67
Friendship 287 4.77 1.688 Trust 0.50
Shared values 287 4.62 1.602 Empathy 0.44
Reciprocity 287 4.56 1.565
Notes: Extraction method: principal component analysis; rotation method: Varimax with Kaiser normalization; rotation converged in three iterations

relationship attributes of trust and commitment (Morgan and
Hunt, 1994), loaded together in the consideration attribute.
This may be because of the variety of service products
investigated and the consumer orientation of this study.
The analysis thus proceeded with five independent
variables, namely, duration of relationship, frequency of
usage, friendliness, consideration and sex. The variable age
was tested on its own as there was a significant correlation
between duration of relationship for each product and age
which would have resulted in an over emphasis on the time
factor if analysed together. To test H1, H2, and H4 multiple
regression analysis was performed. In each case we tested for
collinearity (both Tolerance and VIF values were between 1
and 2 and within the acceptable range), casewise diagnostics
(all zero), and Cook’s Distance (all under 0.1). No outliers
were found (outside plus or minus 3.3) and all scatter-plots
were satisfactory. H3, testing for any relationship of sex and
age with strength of relationship, was tested using a one-way
ANOVA. The results of these analyses are discussed next and
summarised in Table III.
Duration effect on strength of relationship (H1)
The literature indicated that strength of relationship should
increase with the duration that a customer had been using the
services of a particular provider. As shown in Table III, the
effect of duration of relationship on strength of relationship
showed considerable variation between service products. For
the doctor (ß ¼ 0:30, p , 0:001) and hairdresser (ß ¼ 0:31,
p , 0:001) there was a significant effect on strength of
relationship. That is, the longer an individual has been going
to the same doctor or hairdresser the stronger their
relationship. For the electricity supplier (ß ¼ 0:13, p , 0:05)
and the bank (ß ¼ 0:10, p , 0:1) the relationship was weak,
while for the cinema there was no significant relationship. H1
is therefore partially supported for four of the five service
products where the strength of relationship increases
significantly with time. The results do, however, suggest that
for highly personal services, where the customer is likely to
receive service from the same provider (that is, hairdressers
and doctors) length of relationship appears to have a major
effect on relationship strength. This relationship may be
evident because such services are particularly conducive to
relationship building. For those services that are less personal
and more transaction orientated and therefore less likely to
facilitate relationship development, duration has little or no
impact on relationship strength.
Frequency of purchase (H2)
The literature suggested that strength of relationship should
increase when the frequency of purchase or usage of a
customer service product is greater. As shown in Table III,
frequency of usage moderately affects the strength of
relationship between a service provider and customer for the
doctor (ß ¼ 0:20, p , 0:001) and cinema (ß ¼ 0:20,
p , 0:001). For the hairdresser there was a weak
relationship (ß ¼ 0:15, p , 0:05), while there was no
relationship for the bank, and the electricity supplier is not
applicable. H2 states that the strength of relationship is
greater when the frequency of use of the product is greater.
This hypothesis is thus supported in the case of the doctor

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Table III Standardised regression weights

Independent variables Doctor Cinema Bank Electricity supplier Hair-dresser
Duration (years) 0.30 * * NS 0.1 0.13 * 0.31 * *
Frequency (pa) 0.20 * * 0.20 * * NS NA 0.15 *
Friendliness 0.31 * * 0.52 * * 0.39 * * 0.42 * * 0.12
Consideration NS 0.24 * * 0.12 0.20 * * NS
R2 0.23 0.23 0.14 0.15 0.16
Significance ( p) 0.00 0.00 0.00 0.00 0.00
Notes: * *p , 0:001; *p , 0:05; p , 0:1; NS ¼ not significant; NA ¼ not applicable

and cinema, weakly supported for the hairdresser, but not
supported for the bank. Thus, the more frequently a person
visits their doctor, cinema or hairdresser the stronger the
relationship between the service provider and customer will
become. Collectively, the results show that H2 is only partially
supported as for one of the four service products investigated
strength of relationship did not increased with frequency.
Sex and age (H3)
The relationship between sex and age with strength of
relationship was tested using a one-way ANOVA. Sex was not
found to have a significant impact on strength of relationship
for four of the five service products (doctor, cinema, bank,
and electricity supplier). While an effect was found for the
hairdresser, the relationship was extremely weak (R2 ¼ 0:03).
Thus, in practical terms, there was no significant difference
regarding strength of relationship between males and females
for any of the five products. For the cinema and hairdresser,
age had no significant effect on strength of relationship, while
there was only a very weak relationship for the doctor
(R2 ¼ 0:06), bank (R2 ¼ 0:06) and electricity supplier
(R2 ¼ 0:13). Thus, age had only a very weak effect, or no
effect, for all five services. Overall, there was very little
support for H3.
Relationship dimensions (H4)
The relationship dimensions were tested using the two
components, friendliness and consideration, and the results
for each product are shown in Table IV. For all five products,
relationship strength was significantly related to friendliness,
four moderately strongly (doctor ß ¼ 0:31, p , 0:001; cinema
ß ¼ 0:52, p , 0:001; bank ß ¼ 0:39, p , 0:001; electricity
supplier ß ¼ 0:42, p , 0:001), and one only weakly
(hairdresser ß ¼ 0:12, p , 0:1). Thus, the friendliness
Table IV Relationship dimensions
Independent variable Product p beta
Friendliness Doctor 0.001
Cinema 0.001
Bank 0.001
Electricity supplier 0.001
Hairdresser 0.1
Consideration Doctor NS
Cinema 0.001
Bank 0.1
Electricity supplier 0.01
Hairdresser NS
dimension was supported as having a significant impact on
relationship strength for all five products. For the
consideration dimension, there was a moderate relationship
with relationship strength for only two products (cinema
ß ¼ 0:24, p , 0:001; electricity supplier ß ¼ 0:20, p , 0:01),
a weak relationship for the bank (ß ¼ 0:12, p , 0:1), and no
significant relationship for the doctor and hairdresser. These
findings are shown in Table III. It is of interest here that the
consideration dimension appears to be reversely related to
strength of relationship and the degree of involvement of the
service product. Thus, H4 is partially supported.
Type of service product (RQ1)
The differences apparent in the above results for the five
different service products clearly indicate support for the
variability of strength of relationship by service. As shown in
Table III, for all five service products tested, the overall model
was significant, showing moderate predictive capability for the
doctor and cinema (R2 ¼ 0:23 for both products), and weak
predictive capability for the bank (R2 ¼ 0:14), the electricity
supplier (R2 ¼ 0:15) and the hairdresser (R2 ¼ 0:16). Neither
sex nor age had a significant impact on strength of
relationship. These results show that the duration of
relationship, frequency of usage and relationship dimensions
in combination are significantly related to strength of
relationship between customer and service provider.
Discussion and implications
The results of this research indicate that the relative impact of
relationship and customer characteristics on relationship
strength varies significantly with the nature of the service
product under consideration. These findings suggest that the
application of relationship marketing at the business or
organisational level needs more specific and discriminating
attention from researchers and practitioners. They also
suggest that the application of relationship marketing to
firms has been oversimplified. The belief that an organisation
0.31 must undertake relationship marketing activities to the same
0.52
degree to remain competitive will almost certainly have a
different level of relevance to different services. It is
0.39
imperative that firms clearly understand what relationship
0.42
marketing is and the ramifications of its application in varied
0.12
business situations. The intricacy and variation of the
significant and non-significant relationships between the
0.24 various independent variables and strength of relationship
0.12 clearly indicates the complexity of the relationship marketing
0.20 construct. This complexity is a clear warning to researchers
and practitioners alike that the use of relationship marketing
as a marketing tool must be thoroughly researched prior to

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implementation; otherwise much money and resources could Figure 2 Revised theoretical framework
be wasted developing a relationship with customers when they
do not desire or perceive such a relationship with certain
service providers.
The impact of the two relationship dimensions of
friendliness and consideration on relationship strength
suggests that perceptions about the importance of these
dimensions to relationship development are a strong driver of
relationship strength. Thus, the more important a dimension
is to relationship development, as perceived by the customer,
the greater their strength of relationship. From a managerial
perspective this finding suggests that service providers need to
understand which relationship dimensions are the most
important to customers as these will ultimately drive the
strength of the relationship developed between the provider
and customer. The difficulty from a managerial perspective is
that firstly, managers have no control over customer inherent
perspectives and some customers want strong relationships
while others do not, and secondly, managers cannot normally
measure individual perspectives to find out where each
individual customer stands. They can, however, conduct
research to identify the overall customer profile and to
segment according to relationship development propensity.
It was found in this study that the way in which relationship
strength develops varies significantly between service
products. In this respect many of the assumptions reiterated Limitations and future research
throughout the literature can only be supported in certain
service situations. Thus, law like generalisations cannot be As is the case with any research, this study has limitations.
The model developed in the study is based on a cross-
strictly applied. Indeed, the universal application of such
sectional sample, highlighting that the research would be
assumptions could lead to relationship marketing practices
enhanced by longitudinal studies. Nonetheless, our study is
being applied either too broadly or in service situations that
no different in this respect from numerous other studies
are not conducive to the building of relationships. However,
examining models through a cross-sectional design (e.g.
as in the case of duration, frequency and relationship
Morgan and Hunt, 1994). While the research model was
dimensions, the impact of these variables depends heavily
limited to the investigated constructs to achieve parsimony it
on the nature of the service product in question. Collectively,
is recognized that a number of other constructs could have
these results suggest that the way in which relationship
been included as antecedents of relationship strength. Such
strength develops varies considerably between service
constructs could include personality and customer
products, bringing to light the importance of understanding orientation. Additionally, there were limitations inherent to
how the relationship between a service provider and customer the research design which was restricted to just five service
strengthens. From the results, the theoretical framework products and did not consider consumer goods.
shown at Figure 2 is suggested. A further limitation is that the study findings may not be
The findings of this study suggest that marketers should not applicable across cultures; researchers may find that results
expect customer and supplier relationships to automatically differ between western and non-western cultures and in
strengthen with duration or frequency of contact. Application developed versus less developed countries. Thus, it will be
of these assumptions without regard to the nature of the important to test our predictions in cross-cultures studies.
service product may lead to firms attempting to build While there is some indication that the independent
relationships in situations that are not conducive to variables duration, frequency, friendliness and consideration,
relationship development, with the potential result being as well as the service product type all have an effect on the
wasted resources generated from the misapplication of strength of relationship perceived by the customer there is
relationship marketing practices. Additionally, the strategic insufficient support for claiming that a causal relationship
implications of relationship marketing or increasing exists. In the case of duration of the relationship, there is
relationship strength in terms of competitive advantage, certainly evidence of the time order of variables, but there is
differentiation, core competency, key industry success factors, insufficient evidence concerning concomitant variation and
market share and increased profitability cannot be overlooked elimination of other possible factors. For the other
for the “right” service products. Therefore, understanding the independent variables, there is less evidence to support
nature of the relationship marketing construct is essential if causality.
marketers are to implement effective relationship marketing The outcomes of this research provide relationship
programs. One other factor emerges from this study, that is to marketing scholars with new research directions into
demonstrate just how complex “relationships” are in both understanding the way in which relationship strength
theory and practice, and how difficult it is for managers to develops. Specific research directions include identifying
understand, let alone “influence” their development. whether psychographic and/or personality traits impact on

287
 The complexity of relationship marketing for service customers
Tony Ward and Tracey S. Dagger
relationship strength and can be used to identify consumers
who have a greater propensity to form strong relationships.
Further investigation of a wider range and number of service
products (and goods) and their respective impact on
relationship strength is required, especially in light of the
divergent results of this study. Researchers could examine
additional high and low involvement services or services
which are high and low in credence or tangibility factors.
Moreover, we do not clearly understand for each product
whether consumers tend to form relationships with the brand,
supplier or staff member. Yet, such an understanding is vital
for services with high customer-provider contact. Cross-
cultural replication studies would also add to current
knowledge in this area. Finally, research could focus on
identifying those situations that are most conducive to
relationship formation.
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Volume 21 · Number 4 · 2007 · 281 –290
Corresponding author
Tony Ward can be contacted at: t.ward@cqu.edu.au
Executive summary and implications for
managers and executives
This summary has been provided to allow managers and executives
a rapid appreciation of the content of the article. Those with a
particular interest in the topic covered may then read the article in
toto to take advantage of the more comprehensive description of the
research undertaken and its results to get the full benefit of the
material present.
Long gone are the days when most marketers focused solely
on acquiring customers, while neglecting the need to retain
them.
In today’s business environment customer retention,
looking after the customer base, developing long-term
relationships, and fostering loyalty are all words and phrases
likely to crop up in a relationship marketing program, along
with references to customers’ “lifetime value” and impressive
statistics about how a relatively small customer-retention
figure can result in a huge boost in profits.
Who can argue that relationship marketing is the creed to
follow? Especially when researchers’ common and continuing
theme is that establishing and maintaining relationships with
customers will foster customer retention, customer share
development, increased profit and even recovery should a
problem occur, and that relationship marketing has, therefore,
become increasingly important as a business strategy.
But does it apply to all products and services and all
customers? Not according to Tony Ward and Tracey S. Dagger
who challenge a number of underlying assumptions inherent
to relationship marketing for which, they say, empirical
support is lacking. They suggest, for instance, that the nature
of the relationship may be service-specific and consequently
differ between high and low involvement services. There is
also a need to differentiate between true customer loyalty and
habitual buying patterns.
The assumptions under scrutiny include:
.
a relationship can be formed with all customers, in all
service situations, suggesting that all organizations should
partake in relationship development;
. relationship strength will increase as the duration of the
relationship increases;
.
the more frequent contact consumers have with a
particular service provider the greater the opportunity
for the relationship to strengthen;
.
that customer demographic characteristics impact on
relationship strength; and
.
that relationship strength will increase more if the
customer places greater importance on such relationships.
An oversimplification of relationship marketing, and referring
to any activity that is remotely linked to increasing the
customer base as “relationship marketing”, can result in many
firms implementing programs without a clear understanding
of relationship marketing concepts and their application to
varied business situations. While there may be many
organizational and structural reasons for the many failed or
stalled customer relationship initiatives it is also likely that
they were applied in service settings where relationships have
limited meaning or relevance.
 The complexity of relationship marketing for service customers
Tony Ward and Tracey S. Dagger
Following a study among customers of five service types –
doctors, hairdressers, electricity supplier, cinema and bank –
Ward and Dagger say: “Marketers should not expect
customer and supplier relationships to automatically
strengthen with duration or frequency of contact.
Application of these assumptions without regard to the
nature of the service product may lead to firms attempting to
build relationships in situations that are not conducive to
relationship development, with the potential result being
wasted resources generated from the misapplication of
relationship marketing practices. “
Their findings indicate that the relative impact of
relationship and customer characteristics on relationship
strength varies significantly with the nature of the service
product under consideration, suggesting that the application
of relationship marketing to firms has been oversimplified.
For instance, consumers rated the strength of relationship
with their doctor or hairdresser as stronger than that with
their cinema or electricity supplier, but the duration of use of
service was stronger for the cinema and electricity supplier.
As a marketing tool, relationship marketing must be
thoroughly researched prior to implementation. If not,
money and resources could be wasted developing a
relationship with customers which they neither want nor
value. Firms need to clearly understand exactly what
relationship marketing is, and how it applies in varied
business situations. The belief that an organisation must
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290
Journal of Services Marketing
Volume 21 · Number 4 · 2007 · 281 –290
undertake relationship marketing activities to remain
competitive will almost certainly have a different level of
relevance to different services.
Ward and Dagger say:
The impact of the two relationship dimensions of friendliness and
consideration on relationship strength suggests that perceptions about the
importance of these dimensions to relationship development are a strong
driver of relationship strength. Thus, the more important a dimension is to
relationship development, as perceived by the customer, the greater their
strength of relationship. From a managerial perspective this finding suggests
that service providers need to understand which relationship dimensions are
the most important to customers as these will ultimately drive the strength of
the relationship developed between the provider and customer.
The difficulty from a managerial perspective is that managers have no
control over customer inherent perspectives and some customers want strong
relationships while others do not, and managers cannot normally measure
individual perspectives to find out where each individual customer stands.
They can, however, conduct research to identify the overall customer profile
and to segment according to relationship development propensity.
The strategic implications of relationship marketing or
increasing relationship strength in terms of competitive
advantage, differentiation, core competency, key industry
success factors, market share and increased profitability
cannot be overlooked for the “right” service products.
(A précis of the article “The complexity of relationship marketing
for service customers”. Supplied by Marketing Consultants for
Emerald.)