A non-matrix approach to customer relationship portfolio management: a case study from the UK industrial market context

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Abstract:

This research outlines empirical findings on Customer Relationship Portfolio Management (CRPM). CRPM has been a persistent stream of research within the relationship management field. This theoretical concept emphasises a resource-based integrated approach to the management of an organisation's customer relationships and has been largely inspired by matrix-orientated portfolio models developed within other related management disciplines. However, it remains largely conceptual with comparatively little empirical support and lack of reporting from the field about the reality of relationship portfolio management (Leek et al. 2004; Terho and Halinen 2007). This stream of relationship management literature initially emphasised sales volume, revenue, segment profitability, individual customer profitability and subsequently made the transition to using relationship value as the dimension to understand value from customers, involving the implementation of action plans after factoring in the variability in behaviour of different customers. Though relationship value is considered to be more useful than the previously used dimensions, there has been very little empirical evidence of how it is used in reality by industrial marketers in managing customer relationship portfolios. Thus, this in depth case based research explores the role of 'expected' relationship value in a seller's customer relationship portfolio strategy. The seller in this case is a multi national oil company operating in the UK mature industrial market context. The researchers have formulated a multi-step data analysis technique to analyse the data collected. This investigation into how the organisation uses relationship value leads us to a non-matrix orientated approach to managing a portfolio of customer relationships.

Keywords: CUSTOMER PORTFOLIOS; CUSTOMER RELATIONSHIP MANAGEMENT; INDUSTRIAL MARKETING; RELATIONSHIP VALUE; UK

Document Type: Research Article

DOI: http://dx.doi.org/10.1362/147539208X369661

Publication date: September 1, 2008

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