California Management Review

Abstract

Customer Relationship Management (CRM) is premised on the belief that developing a relationship with customers is the best way to gain their loyalty. It is argued that loyal customers are more profitable than non-loyal customers. Recently, academic researchers have questioned some of the key premises that are used to support CRM in general, and relationship marketing and customer loyalty programs in particular. This article critically examines the assumptions that underpin CRM and presents the results of research that is skeptical of its value. CRM should only be adopted after a careful appraisal of its cost-effectiveness.

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