MIT Sloan Management Review

Customer relationship marketing was supposed to be a “new paradigm,” yielding more loyal customers and much more profit for companies. It hasn’t. What should managers do?

Many think that the way to capture value through relationship marketing is to focus on the “good” customers and get rid of the “bad” ones. But there is more to best practice relationship management than maximizing revenues on individual customers and minimizing costs to serve. This article provides guidelines for companies that want to improve the value of customer relationships. For most companies, the transition to a relationship-based approach will require a significant shift in practice.

In sales, the rapport between a prospective buyer and seller can be the deciding factor. Using analytics, Assurant Solutions has tripled its success. (A case-study interview.)

Large companies that invest in trendy IT innovations may see their reputations — and CEO compensation — increase the next year.

The benefits of engaging customers in product development, product support and related activities are increasingly visible. Having the right technology-based system can enhance the customer experience and help companies improve both their innovation and customer relationship management capabilities.

While relationship marketing assumes that companiesrelate to customers, collaborative marketing requires that companieswork with customers to define, design and deliver value.

As customer power grows, innovative companies are moving beyond traditional push marketing and customer relationship management to become full proponents of the customer agenda.

Companies with the best connections to their customers unwaveringly focus their orientation, configuration and use of information on the people and businesses that buy from them.

As the Internet becomes ubiquitous in business life, early fears that it would disrupt the business models of many companies (for example, by enabling customers to switch suppliers easily) have subsided.

Suppliers think social contacts matter a lot — but buyers are much more concerned about prices and switching costs.