Relationship value: Considering customer value from the perspective of relationship marketing, or relationship value, is the most recent development in value research. However, as yet there is limited theoretical and empirical work in this area (Ravald and Gronroos, 233-543). Crosby, Evans and Cowles (89-98), in their study of relationship quality in services selling, represent one of the first pieces of work in this area.
They highlight the need to understand the elements of `quality' in a relationship. They suggest addressing this by understanding the nature, consequences and antecedents of relationship quality as perceived by the customer in longer-term relationships. This view acknowledges that the creation and recognition of quality or `value' in a relationship involves the customer as well as the service organization.
Wilson and Jantrania (208-292, 306-363) were the first researchers to explicitly describe the dimensions of `relationship value'; these include economic dimensions (investments quality, value engineering, concurrent engineering and cost reduction, strategic dimensions (core competencies, strategic fit, time to market and goals) and behavioural dimensions (social bonding, trust and culture). They make the fundamental point that any relationship creates some value to both partners and how this value is shared is likely to be a major issue in the life of the relationship.
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Tzokas and Saren (85-98) provide a useful overview of this and other approaches to understanding value within relationships, and conclude that further research needs to be done in this area. The relationship itself can also have a major impact on the total value received by the customer (Ravald and Gronroos, 56-85). These authors emphasize that in a relational context `... value for the customer is not embedded in a transactional exchange of a product for money. Instead customer perceived value is created and delivered over time as the relationship develops' (Gronroos, 316-373).
In a long-term buyer-seller relationship they suggest the need to look at `total episode value' which they describe as a function of `episode value' and `relationship value' in the following equation: total episode value = episode benefits +relationship benefits/episode sacrifice + relationship sacrifice They show that a poor episode value can be balanced by a positive perception of the relationship as a whole, so it is important for the supplier to maintain a good relationship with the customer, since this could make the customer more tolerant towards occasional inferior performance.
Any relationship creates some value to both partners; thus how this value is shared is also likely to be a major issue in the life of the relationship. Further work by Gummesson (233-543) proposes a number of fundamental values in relationship marketing, the core value being the emphasis on inter-party collaboration and the creation of mutual value. This derives from other work on relationship value and on the value constellation.
Gummesson's concept of `total relationship marketing' emphasizes long-term win-win relationships with customers, which transcend boundaries and disciplines. Here, value is co-produced through the interaction of a number of additional stakeholders including suppliers, customers, competitors and others. This stream of research is important because understanding relationship value in long-term relationships can have a critical impact if a company is taking a relationship marketing approach to its customers.
It differs from previous streams of value research in that it acknowledges the on-going interactions over time between a company and its customers (for example, the augmented product concept (Levitt, 306-363) considers only a discrete customer episode). No longer can value be viewed as part of an individual transaction process; value is created over time and will be subject to changes and external influences, e. g. other stakeholders. It also adds dynamism to the value concept.
However, research in this stream is at an early stage of development. More conceptual and empirical research needs to be undertaken here and the role of and interaction between different stakeholders needs further consideration. One objective of this paper is to address this gap by developing a conceptual framework for relationship value management which integrates key elements from the nine core streams of the value literature within a multi-stakeholder context.
Within the core streams of value literature above, we have outlined how customer value and shareholder value need to be considered together, and also briefly discussed the role of employee value. We have also suggested it is important to recognize that customer value in the context of relationship value is a dynamic concept; value is created and changed over time as a result of an ongoing series of transactions.
However, we consider that customer value, shareholder value, employee value and relationship marketing are closely related and form part of a broader value process, In this section we consider the role of multiple stakeholders. In the following section we develop a framework for relationship value management based on a relationship marketing perspective which draws on concepts from the nine core streams within the value literature.
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