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This post is one in a series building up to the release of Pursuant-sponsored relationship fundraising research conducted by Adrian Sargeant and Rogare that will be released in early 2016.

Caring about customers, and even being willing to say they are “always right,” has long been a part of marketing strategies and customer service. But the idea of placing primary emphasis on the quality of relationships, rather than on products or transactions, is relatively new. So where did it come from?

“Relationship marketing,” where an organization shifts its whole perspective on approaching customers based on the quality of the relationship that can be developed between them and the organization, dates from the 1970s . The Nordic School of Service Marketing and the Industrial Marketing and Purchasing group, in separate ventures, came to share a number of conclusions. In particular, they agreed that marketing needed to be built by leveraging relationships, rather than by stimulating a series of transactions.

A History of Relationship Marketing

What early relationship marketing studies realized was that the price of a product was not the key factor in securing a contract.

Instead, buyers apparently preferred to deal with suppliers who they had had past dealings with—presumably because they knew how these firms operated and could trust them to deliver.

In other words, the quality of supplier relationships outweighed the cost of the product or service the supplier was offering.

These studies and observations from the 1970s were conducted in a strictly business to business (BTB) domain—it was not until the late 1980s that these ideas began to be applied in a business to consumer (BTC) context. In fact, in the early 1980s, BTC marketers were aware of the relationship marketing ideas being circulated among the BTB community, but were convinced these could never be applied to their own models. But by the early 1990s, technology had caught up and was beginning to prove the adaptability of relationship marketing to new arenas: customer databases could be analyzed to calculate the “lifetime value” of a given consumer, and help a company to identify their most important customers and implement potential cross-sell or up-sell opportunities. These new analytical processes began to open up the ways relationship marketing strategies could be fruitfully engaged.

Around this time, Ken Burnett was writing his own Relationship Fundraising text. Relationship fundraising and relationship marketing in the BTC context developed simultaneously, and both emerged from the philosophy of relationship marketing that was being applied in the BTB context. The philosophy and practices have spread ever since, with a surge of consumers joining loyalty programs and in other ways demonstrating they were indeed desirous of relationships with business organizations. And since that time, relationship marketing has been credited with increased customer cooperation, a reduction in new product failures, increased purchases, and decreased customer defection. For their part, customers have appreciated not having to settle for mass-produced goods or manipulative marketing techniques. The relationship model has benefited all sides.

How has your organization put an emphasis on building quality relationships with your donors?

Photo credit:  Gustavo Frazao/Shutterstock