What is the difference between relationship marketing and transactional marketing?

Answer 1

Essentially, transactional marketing focuses on getting the customer to buy a certain product and walk away, whilst relationship marketing sees the sale as the first step in the building of a relationship.

Transactional marketing, in the perspective of luring the customer for a one off purchase, focuses strongly on price and short term benefits and product performance, with limited service. Relationship marketing is all about generating repeated sales and customer interactions, thus focusing on bringing value to the customer, and assuring long term performance and service - all aspects of quality become major concerns.

Relationship marketing brings customer centricity to the spotlight. This vision has implicit the fact that a customer does not buy a product, but instead buys a solution for a specific problem or need. By satisfying this need, a company has access to many other opportunities that the customer will have at some point. Thus, if the company can build a relationship with the customer - find out who he is, what these needs will be - , it will be able to gain a lot more than just a single sell.

Two illustrative approaches to the relationship vs transaction approaches are Tesco and Walmart. Whereas Tesco tries to engage in relationship with it's local customers resorting to loyalty programmes and such, WalMart lives under the "If you want loyalty, get a dog" motto set by Sam Walton, and focuses on giving customers "every day low prices", regardless of any past interactions.