Taking a Customer Focus Back Into the Boardroom: Can Relationship Marketing do it?

Abstract

Marketing and marketers are becoming marginalized in a growing number of companies. The interest in shareholder value and short-term gains on the stock market has reinforced the position of managers trained in finance as the most valued persons for the top positions. However, in the final analysis the long-term economic result of a firm and value for shareholders does not come from the stock market, but from the customers of that firm. Why is marketing about to become marginalized? There seems to be at least two different, but related, reasons for the demise of marketing. Firstly, mainstream marketing, based on the marketing mix management approach and its 4 Ps, is becoming less relevant for customers and for the management of customers (marketing) alike. Marketing is preoccupied with activities that only partly, if at all, are effective. In business-to-business, sales with its direct customer contacts is considered important, whereas marketing gets comparatively small budgets and plays a limited role. In services, marketing has a more dominant role with larger budgets, but it is often highly unproductive. Money is largely spent on activities that far too often have only a limited impact on customers. Only in packaged consumer goods does mainstream marketing holds on to its position, but even there changes can be seen. Secondly, because mainstream marketing is occupied with doing things and spending a budget on marketing mix variables, marketing has become a cost issue only, instead of a balance sheet issue as well. From a shareholder perspective this is, of course, not very interesting. Hence, marketing is not relevant for shareholders and the finance market either. Mainstream marketing has always been defined as doing something to customers, instead of doing it for them (Dixon and Blois,