4.1.1 Components of relationship marketing

Relationship marketing is characterized by a wide range of relationship variables that facilitate the creation of an exchange of value. For example, two-way communication or trust can determine the customers’ willingness to participate in a relationship with a company.

^{Cano et al. (2021)} explain that for relationship marketing to be successful, marketers must understand customer demographics and historical data. This knowledge allows them to understand who they are and their purchasing patterns, thus establishing appropriate strategies to relate to them long-term (^{Asikhia, 2012}). Besides, understanding the customers, their needs, perceptions, and expectations allows companies and their marketing teams to embrace customer-centric approaches that build trust, ensure effective communication, and encourage commitment, among other components that affect relationship marketing.

This section discusses these dimensions to understand how they affect relationship marketing and potentially contribute to customer satisfaction.

Trust: Research shows that trust is vital in relationship marketing since relationship building in marketing depends on the client’s belief that the company can deliver as promised. For example, if the company promises to provide quality products that meet customer needs, it must ensure that customers know it is reliable. Thus, ^{Nguyen Hau and Viet Ngo (2012)} define trust as a customer’s willingness to rely on an exchange partner with whom they have confidence. Similarly, ^{Rizan et al. (2014)} define it as the belief in the other party’s intentions. As a result, the extent they feel they can rely on each other’s promises.

Trust reflects a customer’s confidence level in a company’s integrity and reliability. For relationship marketing to succeed, customers must trust that the company will deliver its obligations and keep its promises (^{Mahmoud et al., 2018}). However, trust is built over time and contributes to creating and reinforcing relationships between trading parties. When customers trust a service provider or a manufacturer, they will continue using the service or product and recommend it to other potential customers (^{Sharifi & Esfidani, 2014}). Therefore, trust is a critical indicator of successful relationship marketing and can help achieve long-term profitability and customer satisfaction.

Competence: Competence refers to the marketers’ abilities and expertise as perceived by the customer. ^{Sayil et al. (2018)} define it as the essential skills and knowledge required to deliver a service. Concerning relationship marketing, marketers must prove they understand their products and services. For example, they must understand the physical and technological aspects of the services provided. This knowledge appeals to target customers and can influence their perceptions and willingness to engage in a business relationship (^{Sliz & Delińska, 2021}).

Customers who engage a competent seller receive value in the form of critical product or service details needed to make purchasing decisions. Consequently, the interaction influences their feeling and attitudes towards the brand and its associated products and services, thus encouraging them to invest in building and maintaining the relationships built (^{Chiu et al., 2015}). For instance, if customers know they can ask a specific seller about products or services of interest, the relationship becomes valuable and important. As a result, they will willingly reinforce and maintain the relationship, resulting in successful relationship marketing.

Commitment: Commitment is a critical construct for measuring the strength of a marketing relationship and the likelihood of achieving customer satisfaction. According to ^{Nguyen Hau and Viet Ngo (2012)} , commitment is an enduring desire to continue a valued relationship. Furthermore, ^{Cano et al. (2021)} identify commitment as an “essential ingredient” of long-term success since it compels customers to buy from a particular seller. It indicates the customer’s willingness to purchase and actively maintain a relationship with the marketer or the company. However, developing customer commitment is influenced by other components, such as trust and customer satisfaction, since it only arises when clients feel it is essential to maintain the relationship (^{Chu et al., 2018}). Thus, customers must derive a specific value from the engagement with the marketers or the companies to think it is worth maintaining the engagement.

^{Mahmoud et al. (2018)} propose multiple ways that can be used to build customer commitment, including adjusting products or services to meet customer needs. The authors note that customers’ perceptions of the efforts made by the seller directly influence their commitment levels. In addition, research shows that commitment leads to relationship marketing outcomes such as loyalty and positive word-of-mouth. Therefore, relationship marketing marketers should prioritize approaches that build customer commitment to achieve the desired results.

Communication: Communication refers to the formal and informal ways of exchanging information between the seller and the customers. In today’s business environment, communication is viewed as an interactive dialogue between a business and its clients. It occurs throughout all stages of conducting trade, including pre-selling, selling, consuming, and post-consuming.

^{Irving and Mathews (2015)} identify communication as a critical relationship-building strategy, often used to align goals, resolve disagreements, and identify value-creation opportunities. In relationship marketing, this component is used to maintain contact with valued customers by offering trustworthy and timely information on products and services, changes or new developments, or resolving complaints (^{Lau & Ahmad, 2015}).

The communicator is responsible for communicating value, product features, and performance to develop consumer preference, build awareness, and convince potential customers to purchase (^{Cockalo et al., 2012}). In addition, appropriate communication is applied to inform dissatisfied customers of the plans to rectify the problems causing their dissatisfaction. In short, communication helps improve relationship quality, which in turn causes higher customer satisfaction.

Conflict handling: Conflict handling refers to the seller’s ability to reduce the negative consequences of manifested and potential conflicts. When not handled well, manifest conflicts can create problems that hurt an organization’s reputation and severely affect its customer relationship (^{Mahmoud et al., 2018}). Thus, conflict-handling measures and skills are essential in relationship marketing since they help avoid or solve conflicts when they arise.

^{Sayil et al. (2018)} note that an increase in disputes is likely to lower a customer’s confidence in the seller’s orientation or willingness to invest in building and maintaining relationships. Moreover, ^{Cano et al. (2021)} explain that the supplier’s outcomes of conflict-handling efforts often depend on the customers’ prior satisfaction with the relationship, evaluation of alternative solutions, and the level of investment in the relationship. This argument indicates that customers who are more invested or committed to the relationship or the brand are more likely to accept the conflict resolution tactics employed in case of a problem than those with little or no commitment. This situation shows the interconnection between multiple components of relationship marketing and the need to ensure that all the aspects are considered.

4.2.1 Determinants of customer satisfaction

Multiple factors can influence customer satisfaction. For example, some customers derive satisfaction from prior expectations of a store’s previous performance. In this case, if a company is known to have quality products, the customer will automatically have high-quality expectations (^{Schaefers et al., 2015}). Thus, if these expectations are unmet, the customer will be disappointed, leading to dissatisfaction. In this regard, ^{Shin and Thai (2015)} define satisfaction as a customer’s feelings of pleasure or disappointment resulting from a consumption experience based on a comparison of perceived performance and expectations. Therefore, relationship marketing is critical in coordinating a company’s business activities and customers’ expectations (^{Dorai & Varshney, 2012}).

The engagement involved in relationship marketing can be used as a strategy to gather customer insights, including their needs, experiences, and expectations. These insights can then be integrated into product development processes to ensure that products delivered to target customers address their specific needs to avoid disappointment and ensure satisfaction.

Perceived value: Customer perceived value refers to a customer’s perception of a product or service’s desirability, especially when compared to other alter-natives in the market. It is reflected in the price that customers are willing to pay for the products or services offered (^{Anabila, 2021}).

One major challenge that companies face with perceived value is that it is controlled and measured by the customers. They determine and set the standards and measure a product or service’s value based on various factors, including the availability of financial resources, knowledge about the products or services, quality expectations, experiences, and accessibility (^{Fuentes-Blasco et al., 2017}).

Perceived value is often determined based on the customers’ perceptions of what they have received regarding quality and satisfaction and what they have given in terms of monetary and non-monetary costs (^{Sahiti et al., 2020}). Therefore, marketers and their respective organizations must ensure that the value of products and services sold to target customers match the prices and other costs incurred. Furthermore, perceived value significantly influences customer satisfaction and willingness to maintain long-term relationships with companies (^{Lee, 2016}; ^{Hannan et al., 2016}). For instance, if the perceived value is high, customers will more likely be satisfied with the products or services provided. Thus, marketing professionals utilizing the relationship marketing approach advertise and price their goods in ways that positively influence the customers’ perceived value to enhance satisfaction.

Expectations: Expectations refer to pretrial beliefs about a service or product. The expectations can result from familiarity or prior experience with a brand or novelty. Customer expectations and satisfaction are closely related. For instance, the customer feels less satisfied if delivered products or services do not match their expectations.

In the current digital world, multiple sources of information are used to influence the customers’ expectations of a product or service (^{Saleem et al., 2016}). For example, online reviews depicting the product or service as quality or valuable will influence high expectations. Moreover, a company website that offers product details, including features and benefits, can affect expectations (^{Popp & Woratschek, 2017}).

Other information sources before exposure include word of mouth, expert opinions, or company-controlled communication and publicity (^{Eisingerich et al., 2014}). These information sources build an image of the quality of the products or services and the value delivered. Given that customers access these insights before exposure to the service or products, risks of dissatisfaction are high (^{Elena et al., 2014}). For instance, in cases where the delivered products or services fail to meet these expectations, the customer will be dissatisfied and may never purchase products from that company (^{Malik et al., 2019}). This situation reflects the significance of relaying accurate product information throughout the marketing processes to ensure that a customer’s purchasing decisions and intentions are based on correct details.

Perceived quality: Perceived quality is an assessment indicating how well the service level matches customers’ expectations. Service providers or manufacturers are expected to achieve customer satisfaction by matching expected service with perceived service (^{Elommal et al., 2019}).

Customers will always compare what they feel a company is supposed to offer and what it actually delivers. This comparison determines the perceived quality and influences customer satisfaction. Thanks to advanced technologies and globalization, customers have higher expectations of value and quality (^{Mattsson & Chadee, 2015}). Therefore, relationship marketing facilitates interactive communication to convey these expectations, thus allowing companies to design and develop products and services specifically to meet these needs (^{Gray & Wert-Gray, 2012}).

An organization’s customer service can determine a customer’s perceived quality of services. For instance, customer service is critical in maintaining constant communications with customers, transferring essential information, and managing complaints resulting from bad experiences with products, services, or orders (^{Rostami et al., 2014}). In addition, it also helps analyze customer wants and needs and communicate the same to other departments, including product development and marketing (^{Fazal et al., 2017}).

If customer service professionals attend to these duties, they are more likely to influence customers’ perceptions of service quality. For example, if a complaint is handled faster and the problem resolved, the customer will most likely associate this instance with high quality. Therefore, influencing customer perceived quality through customer-centric strategies is critical to improving customer satisfaction.

Price fairness: Typically, negative price fairness perceptions trigger negative emotions such as disappointment and anger, leading to adverse behavioral outcomes. For instance, customers experiencing these negative emotions may switch to competitors, seek legal action, or complain to other potential clients, thus spreading negative word of mouth. Therefore, the salesperson must ensure that techniques applied to communicate the price and handle customer reactions influence positive perceptions of fairness (^{Erwee, 2015}). For example, the price offer quoted by the salesperson should be accompanied by an explanation of other aspects, such as delivery charges, financing arrangements, or down payments.

Explaining the terms associated with the price offer is critical to ensure that customers understand all the costs associated with the purchase. Salespersons and their respective companies must consider price differences since they may negatively influence consumers’ perception of price fairness (^{Haumann et al., 2014}). Research shows that customers develop perceptions of price unfairness if they discover that the prices are to their disadvantage; for example, if they are paying a higher price than other customers (^{Söderlund et al., 2014}). These issues can result in dissatisfaction, thus negatively affecting the customers’ willingness to engage in a long-term, mutually beneficial relationship with the company.

4.3.1 Increased satisfaction through service and product customization

Current market trends are becoming more fragmented and heterogeneous, with customers expressing their individual needs. As a result, industries are shifting from mass production to customization (^{Swarts et al., 2016}). Similar changes are happening in marketing practice, with customers demanding customized marketing content, services, and products. Therefore, meeting individual customer needs through quality, individualized services, and products has become a major differentiating factor under relationship marketing used to achieve customer satisfaction.

Customization refers to the degree to which a company’s offerings are tailored to meet individual customer needs (^{Coelho & Henseler, 2012}). Unlike conventional techniques that prioritize reaching out to as many customers as possible while satisfying a limited number of needs, customization focuses on meeting as many needs as possible for individual customers. Therefore, it is perceived as a practical solution to the problems associated with increased demand for high-quality products, features, and product variety (^{Tarasi et al., 2013}). Moreover, it is a critical strategy for improving customer experience in successful relationship marketing as it helps gather and analyze essential insights that help differentiate the product and services in ways other than the typical feature-driven messages.

Most companies employ a customization strategy to achieve competitive advantage and company growth. For instance, ^{Coelho and Henseler (2012)} explain that customers are willing to pay more for products that cater to their needs, including tastes, styles, and sizes.

Although customization is associated with higher returns, research establishes that customers only pay higher if the perceived product or service’s value is high and considered worth the monetary and non-monetary associated costs. Consequently, customers see the value in custom-made products based on their products and services (^{van der Aa et al., 2015}).

Relationship marketing helps build trust and commitment and facilitates two-way communication that ensures an understanding of customer characteristics and value determinants. What one customer defines as valuable may differ from what another customer considers worthwhile. Thus, customization ensures the incorporation of these differences in perspectives throughout product development processes.

4.3.2 Building customer trust and commitment to boost customer satisfaction

Numerous studies have demonstrated the impact of trust and commitment on customer satisfaction concerning relationship marketing. For instance, ^{Sayil et al. (2018)} found the effect of relationship marketing on customer satisfaction in the banking sector. According to the study, dimensions of relationship marketing, including trust, commitment, and communication, influence customer loyalty and satisfaction. For customers to conduct business with a company, they must be able to trust it and its products or services (^{Vieira et al., 2022}). Relationship marketing helps in this quest since it aims to establish and maintain long-term, mutually beneficial relationships with clients by fostering greater brand trust and commitment over time.

According to the commitment-trust theory, commitment and trust antecedents must exist for a relationship to succeed (^{Yen et al., 2015}). Therefore, marketers leveraging relationship marketing prioritize bonding with customers to meet their needs and honor their commitments. Instead of chasing short-term benefits, these marketers establish long-lasting bonds that encourage customers to trust the business, leading to mutual loyalty and boosting satisfaction.

Relationships based on trust and commitment are characterized by cooperative behaviors that allow both parties to fulfill their needs. In this regard, companies derive multiple economic advantages from such relationships, including increased profitability, high in-vestment returns, and expanded market share (^{Walsh & Brylla, 2017}). On the other hand, customers get products and services they are paying for. In addition, constant active engagement throughout business practices also makes customers feel valued and increases their sense of attachment to the brand or company (^{Yulisetiarini & Susanto, 2018}). For example, when companies listen to their customers’ feedback and implement shared opinions through valued relationships, customers are more likely to feel a sense of commitment and trust in the brand, eventually leading to higher satisfaction.

4.3.3 Improved repurchase intentions

Relationship marketing builds trust and prioritizes the delivery of quality services, thus resulting in improved customer satisfaction. Research shows that this satisfaction results in repurchase intentions since customers are assured of receiving quality products and services that meet their specific needs and expectations (^{Shin et al., 2017}).

Repurchase intentions indicate the customer’s commitment to a particular product or service, indicating a willingness to participate in a long-term relationship. It is often achieved by managing relationships with customers. ^{Lin and Wang (2015)} explain that marketers aiming to understand their target customer’s repurchase intentions should focus beyond using promotional activities to promote repeat buying. Instead, the authors indicate that they should prioritize building relationships with clients that lead to a commitment to buying from the same company despite competitors’ activities and incentives (^{Menidjel & Bilgihan, 2022}). Furthermore, marketers can leverage relationship marketing to enhance repurchase intentions by moderating the effects of perceived risks (^{Kaur & Gupta, 2012}). Many scholars explain that perceived risks negatively impact repurchase intentions, consequently negatively affect-ing customer satisfaction. In this case, marketers can regulate the effects of perceived risks by building trust and strengthening relationships with customers to reduce the level of perceived threats.

Other aspects characterizing relationship marketing, such as assurance, responsiveness, reliability, and empathy, influence customer repurchase intentions. For example, repurchase rates increase when products and services exceed customer expectations (^{Shin et al., 2017}). However, expectations are based on experience, thus making satisfaction a critical determinant of the success of relationship marketing.

^{Lin and Wang (2015)} indicate that high satisfaction as an emotional response from positive experiences with a product or service tends to enhance customer trust, eventually leading to repurchase intentions. Therefore, providing quality products, reducing perceived risks, and building trust encourage customer repurchase decisions and improve satisfaction.

4.3.4 Delivery of quality services

Service quality and customer satisfaction are arguably two of the most critical concepts in marketing theory and practice. Customers always expect the delivery of high-quality services. In today’s highly competitive business environment, one of the most critical ways of achieving a sustainable competitive advantage is by delivering high-quality services that satisfy customers (^{Hussain et al., 2019}).

Customers can respond to services or products favorably or unfavorably depending on their experience, attitudes, and satisfaction with the value delivered. A favorable response is associated with a company’s economic goals, including profitability, return on investments, and ability to expand market share. Therefore, marketers understand the significance of ensuring positive customer responses to offers (^{Negi & Ketema, 2013}).

Relationship marketing helps improve the delivery of services by attracting, maintaining, and enhancing customer relationships. For instance, the relationship allows marketers to assess potential quality gaps by engaging customers to understand their needs and expectations (^{Raychaudhuri & Farooqi, 2013}). The insights gathered are incorporated into the planning to ensure that strategies, products, and services sold match the customers’ quality expectations, thus improving their satisfaction.

Five service quality dimensions are relevant for customer satisfaction: tangibility, reliability, responsiveness, assurance, and empathy. Tangibility refers to the physical aspects of services, including staff, communication materials, tools and equipment used to deliver services, and physical facilities. For example, physical interactions with customers during relation-ship marketing can influence their satisfaction with the services provided (^{Petzer & van Tonder, 2019}). In this regard, salespersons capable of clearly explaining a product or service to customers during these interactions are more likely to arouse positive feelings and attitudes that result in higher satisfaction (^{Hussain et al., 2019}).

Reliability is the capacity to deliver the promised service precisely and constantly. Thus, relationship marketing is critical in reinforcing the company’s reliability by guaranteeing customer service delivery, communicating value, conflict resolutions, and service arrangements. In this case, marketers function as the link between the company and customers to ensure they remain faithful to their obligations, especially the delivery of unwavering quality.

Responsiveness plays a pivotal role in fostering strong customer relationships within the framework of relation-ship marketing, which is a customer-centric approach prioritizing the timely acknowledgement of customer needs (^{Kiseleva et al., 2016a}). The swiftness and efficiency with which a company responds to customers not only contribute to customer satisfaction but also serve to strengthen the overall relationship. This inclination to promptly assist and support customers becomes a cornerstone in building enduring and positive connections.

Service assurance refers to policies and processes to ensure customers receive services that meet a pre-defined service quality level for optimal experience (^{Raychaudhuri & Farooqi, 2013}). Assurance builds customer trust and confidence in the organization’s ability to deliver its promises and maintain the desired quality.

Empathy is a dimension used in relationship marketing to build a relatable brand. It allows marketers to create strong, natural, emotional relationships with customers. It is achieved by acknowledging and appealing to the role of emotions in customers’ decision making and responding accordingly with appropriate marketing campaigns (^{Kiseleva et al., 2016b}).

Integrating these five dimensions into a relationship marketing strategy enables marketers to interact with customers in ways that create win-win situations that lead to the delivery of high-quality services and consequently enhance customer satisfaction.

4.3.5 Higher customer engagement

Customer engagement is a crucial success factor in relationship marketing that involves communicating and interacting with customers and other stakeholders through various communication channels. For example, engagement in marketing campaigns can occur offline through direct interactions with marketers or online using social media and internet-based channels (^{Kordnaeij et al., 2012}). Research shows consistent and effective customer engagement results in higher satisfaction and other positive outcomes, including increased demand for products and services and consumption (^{van Tonder & Petzer, 2018}). In addition, customer engagement influences attitudes, intentions, and behaviors. A good relationship between a company and its customers based on engagement creates loyalty, thus ensuring that customers continue to choose the company over its competitors (^{Rather, 2019}).

Engagement is perceived as a proxy measure of assessing the strength of a company’s relationships, as reflected in the extent to which customers have established emotional and rational connections with companies. Highly engaged customers are more likely to be more emotionally connected to a brand, thus leading to higher satisfaction and loyalty (^{So et al., 2016}). In this case, leveraging relationship marketing to increase customer commitment can lead to long-term benefits by strengthening company-customer relationships. Therefore, these arguments indicate that customer satisfaction emerges from increased engagement.