How exchange inefficiency and relationship quality mediate the influence of relationship marketing on performance: The critical role of customer relationship orientation

Much of relationship marketing research and practice operates under a common paradigm that firms should build better relationships with their customers in order to increase customers' relationship quality, with the belief that these stronger relationships will lead to improved financial performance. This view is challenged by findings that transactional and relational customers can be equally profitable, and that relationship marketing efforts have varying effectiveness across customers and in some cases may even be detrimental to performance.; This dissertation develops and tests a model to provide a theoretical explanation for these contrary findings by integrating the social exchange perspective typically utilized in marketing with the economics literature's focus on transaction costs. The conceptual model was tested using a combination of a mail survey to industrial customers and a phone survey of their applicable salespeople, resulting in 269 matched customer-salesperson dyads.; The results of the study support the premise that relationship-marketing investments typically lead to strong customer relationships, but when the customer is not relationship oriented then these investments can lead to inefficiencies in the exchange, with a subsequent negative impact on financial outcomes. Customer relationship orientation was found to be affected by industry norms, the customer's incentives and rewards systems, the customer's relationship proneness, the salesperson's competency, and the customer's dependence on the seller's product.; The findings can provide guidance for managers to more effectively target their relationship marketing efforts, improving the return on these marketing expenditures, and provide insight into the primary drivers to a customer's relationship orientation.