CHAPTER 1

INTRODUCTION

An introduction to the Research is provided in this chapter. The chapter begins with a background
concerning the research area which also shows the study’s importance, followed by Problem
Discussion, Developing the Hypothesis, which guides the reader to the research purpose and the
research questions. Finally the structure of the research is presented.

1.1 Background

Global Telecommunication and Indian Telecom Industry and also the market and relationship
marketing will be discussed.

1.1.1. Relationship Marketing

Building and maintaining relationships have considerable long term implication and have an impact
on strategic and long-range firms’ planning marketing. Thus, Relationship Marketing would lead to
greater marketing productivity by making it more effective and efficient. It implies that relationship
building is considered to be a key factor to success.
In order to create relationship between both individual customers and business customers we
should attract them, so Building, Developing and Maintaining relationship with their customers,
both individual customers or businesses, should be their main Goals.

1.1.2. Telecom

Telecommunication plays a vital role as economic sector in world economy. It is highly

competitive market, telecom service providers are certainly forced to deliver new and advanced
services to their customers. It has a growing impact on individuals as well as businesses in terms of
efficiency & servicing and on every country’s competitiveness as a profitable economy.
Due to Paradigm shift from 4P’s Marketing Mix towards Relationship Marketing, Service
Marketing, Industrial Marketing, and Customer Relationship economics demand a move toward
relationship-oriented strategy in marketing.
Telecom Industry has been experiencing a radical change, generating new opportunities &
challenges for infrastructure and Service providers. With the increase in production of mobile
devices & services as international market in recent years, according to triple play of telecom,
entertainment and IT convergence the global telecommunication market is growing and changing.

1.2. Problem Discussion

Despite different types of Relationship Marketing or Customer Oriented Marketing & Business
Relationships, I would like to distinguish “if there is a significant relationship between
relationship marketing programs and Indian Telecom Organizations’ market performance”.
Within the rapidly expanding literature of relationship marketing, B2B marketing & CRM, there is
relatively little attention paid to the value the organization can get from such strategies, such as
supplier’s performance.

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1.3. Purpose of Research

The main focus was on different aspects of the relationship marketing, among various researches
done in the field of Relationship Marketing. Apart from this, very fewer researches are found on the
effectiveness of relationship marketing, and a little empirical research has been conducted on the
values of relationship marketing programs and their effect on supplier’s side.
The goal of this research is to prove the association which exists between relationship marketing
strategies and firms’ market performance.
The findings of this research will help firms understand the effectiveness of relationship exchange
from the firm’s perspective, and develop appropriate relationship marketing strategies in the B2B
market.
In this context, I would like to understand which of the rational activities (such as Attraction
Programs, loyalty and interaction Programs) has significant relationship with market performance.
Following these arguments, we can propose that the value created by Relationship Marketing with
customers will be reflected in market proficiency & performance.

To fulfill this purpose the following Hypothesis can be considered and shall be addressed:
Is there a significant relationship between Attraction activities & Customers’ Perceptions about the
company?
Is there a significant relationship existing between Attraction activities & Market Position?
Is there a significant relationship between Contact & Customers Perceptions about the company?
Is there a relationship between Customer Satisfaction & Customers’ Perceptions about the firm?
Is there a relationship between Complaint & Customers’ Perceptions?
Is there a relationship between Complaint & Market Position?
Is there a relationship between Customers’ Perception about the company & Loyalty?

1.4. Disposition of the Research

Chapter 1: This will present a brief background of Telecommunication Industry and meaning and
scope of Relationship Marketing. A broader problem has been narrowed down to a research
problem and hypotheses.

Chapter 2: Chapter consists of Literature Review along with the frame of references. The chapter
reviews selective literature on Relationship Marketing, Business Marketing and also Industrial
Marketing, Value creation in service, Service quality, Customer attraction, interaction and loyalty
programs. It also consists of Customers’ perception about the company and Market performance.
The second half of the chapter is research framework. Finally, Hypotheses within the research
framework are explicated.

Chapter 3: Determines the type of research. Then it explains the measurement, pilot test, sampling,
data collection method and lastly, the refinement & Validation of the scale items.

Chapter 4: Descriptive Statistics, Assessment of validity & reliability and analysis of data. The
results of Hypotheses tests are presented in this chapter.

Chapter 5: Final Chapter, presents a discussion on the findings, both practical & theoretical
implication of the results. A summary of this study, its limitations, suggestions & recommendations
and future research are presented.

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 CHAPTER 2

LITERATURE REVIEW

The chapter is based on the introduction given lately and the research problem presented in chapter
1 also, the previous studies that have been done within these constructs. It will provide the reader
with a literature review concerning the research area.
There is huge number of research studies carried out in the area of Relationship Marketing. There
have been useful contributions expressed by so many authors about Relationship Marketing theory.
In this study, the contribution will be received to show relationships between these variables and
emphasizes on the “Effect of Relationship Marketing on Market Proficiency”…a study among
Indian Telecommunication Providers. At the end of this chapter, the frame of references will be
presented.

According to the literature, there are numbers of conceptual studies have been done on Relationship
Marketing theory & Strategy.

1. Berry was the first one who used the term relationship marketing in 1983; it will be indicated
that early attempts included a relationship perspective. However, this perspective did not have the
importance it has gained today, due to environmental factors.
Thus, there have been two ways to the present-day relationship marketing:
First was to realize the importance of relationships gradually, initially in service marketing and
partly in industrial marketing.
Secondly, through a transformation of business in general, due to rapid and radical changes in the
environment.

2. According to Gronroos & Liljander and Strandvik, there was a paradigm shift in service
marketing. The shift was a transaction-oriented “marketing mix” view of exchanges to a
relationship marketing view. They proposed that a relationship term should be defined from
customers’ point of view as this corresponds to a market oriented perspective.

3. Shani and Chalasani, 1992, an increasing fragmentation of markets is one of the best ways that a
company can get a permanent competitive advantage and ensure its own survival growth. It seems
that relationship building is considered to be a key factor to success.

4. Yau, 2000: The connection with marketing has seldom been established formally in the
development of marketing theory. Relationships between customers and business firms have been
consistently encouraged as successful business practices worldwide.

5. Batiz-Lazo, 2001: Customer value creation is at heart of relationships between services and
service providers.

6. Gibert (1996) suggested that quality should play role of the chief facilitator to achieve the
objectives of relationship marketing, such as commitment to the brand, emotional involvement, and
active interaction.

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 CHAPTER 3

3.1 Relationship Marketing Theory

According to literature, there are numbers of conceptual studies have been done on relationship
marketing and strategy.

3.1.1 Formation

"Berry was the first one who used the term relationship marketing in 1983; it will be indicated that
early attempts to formulate a general theory of marketing already included a relationship
perspective. However, this perspective did not have the importance it has gained today, because the
environmental factors were not as strong as today. Thus there have been in fact two ways to the
present-day relationship marketing. The first was realizing the importance of relationships
gradually. initially in service marketing and partly in industrial marketing. The second way was
through a transformation of business in general, due to rapid and radical changes in the
environment. These changes resulted in an emphasis on service, close contact with customers, and
a holistic view of the parties and also processes involved in marketing and business". (Toivo,1996)
According to Gronroos (1993) and Lijander and strandvik (1995), there was a paradigm shift in
services marketing. The shift was from a transaction-oriented "marketing mix" view of exchanges
to a relationship marketing view.
Relationship marketing has emerged in response to the Environment's new claims which aim was
blurring boundaries between markets or industries, an increasing fragmentation of markets (Shani
and Chalsani, 1992), this is on of the best ways that a company can get a permanent competitive
advantage and ensure its own survival and growth. It seems that relationship building is considered
to be a key factor to success.

3.1.2 Business Marketing

Relationship marketing (RM) was known as an strategic approach to industrial and service markets,
and was considered to be unsuitable in other marketing contexts.(O'Malley and Tyann 2000)
Businesss-to-Business marketing has been changed during the last thirty years both in the
phenomenon studied and also in its conceptual process, many such as International Marketing and
Purchasing (IMP) Group has been active in B2B . Marketing research believes that if B2B
marketing research starts with relationships between organizations and networks it is a strong
possibility that a new set of findings emerge, different set of assumption be shaped and different
processes be found (Leck et al.2003)
There is no exact definition of relationship marketing , we can strongly say that it has flexible
boundaries but many practioners and academic people are continuing lecturing about the
relationship narketing.
The core of relationship marketing is relations, maintenance of relations between the company and
the actors in its micro-environment, such as suppliers. market intermediaries, the public and
specially customers as the most important actor. The idea is first and foremost to create customer

4
loyality so that a stable, mutually, profitable and long-term relationship in ehanced
(Ravald&Gronroos, 1996).
3.2 Customer Interaction and Programs

"Since relationship marketing includes all activities directed towards the establishment,
development and maintenance of exchange relationships (Morgan and Hunt, 1994) the activities of
a relational strategy should compromise the next objectives (Izduierdo et al.,2005)"
Attraction (creating relationships);
Loyality (developing relationships);
Interaction (maintaining relationships);
As Izduierdo et al. (2005) stated, according to above objectives, we can distinguish three types of
relationship marketing activities: those oriented to attract consumers; those oriented to retain
customers and to create loyality; and those oriented to maintain the relationship.

3.2.1 Service Quality

Every customer has an ideal expectation of the service they want to receive when they go to a
restaurant or store. Service quality measures how well a service is delivered, compared to customer
expectations. Businesses that meet or exceed expectations are considered to have high service
quality. Let's say you go to a fast food restaurant for dinner, where you can reasonably expect to
receive your food within five minutes of ordering. After you get your drink and find a table, your
order is called - minutes earlier than you had expected! You would probably consider this to be
high service quality.

3.2.2 B2B Setting

As always, we must be clear about our definitions.  What are business-to-business markets and
what is B2B marketing?  To answer these questions it is useful to consider the value chain that
starts with a consumer demand and from which dozens of business products or services are
required.  Take the example of the simple shirts that we buy.  They do not arrive in the shops by
accident.  There is a value chain of enormous complexity that begins with cotton or some other
fibre that must then be woven into cloth, which in turn is machined into a garment, packed and
distributed through various levels until finally we pick it from the shelf.  This is illustrated in the
diagram below.  We call this the chain of derived demand since everything to the left hand of the
shirt is pulled through as a result of the demand for the product.  Businesses sell cotton to
merchants who sell it to spinners who sell it to weavers who sell it to garment makers and so on. 
None of the businesses buy the products for pure indulgence.  They buy them with the ultimate aim
of adding value in order that they can move the products down the chain until they finally reach us,
the general public.

3.2.3 Customer Loyalty Program

A loyalty program may give a customer advanced access to new products, special sales coupons or
free merchandise. Customers typically register their personal information with the company and are
given a unique identifier, such as a numerical ID or membership card, and use that identifier when
making a purchase.
Loyalty programs are structured marketing strategies designed to encourage customers to continue
to shop at or use the services of businesses associated with each program. Many such programs
exist covering most types of business, each one having varying features and rewards schemes.

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3.4 Performance Measurement

By the 1980's researchers realized that traditional performance measure were insufficient to manage
organizations competing in modern market (johnson and kaplan, 1987)
There are a large number of performance measurement frameworks (keegan et al., 1989; Lynchand
Cross, 1991; Fitzgerald et al., 1991; Kalpan and Norton, 1992; Bourne et al., 2005) and multiple
processes for the design of performance measurement systems (Bitton, 1990; Dixon et al., 1991;
Kalpan and Norton, 1993,1996; Neely et al., 1996, 2002b; Krause and Mertins, 1999; cited by
Bourne et al., 2005). When it comes down to it, the organizational context performance
measurement content and process will all impact on the outcome. (Bourne et al., 2005)

3.5 World’s Telecom Growth

International Growth of Mobile Phones had been growing fast these years it took 120 years willing
susbscribers to register for one billion cell phone service in the world and at the end on 1997 they
reach this goal.
These days world communication has shifted from analog to digital, narrow band to broad band and
access to information and communication technologies continues to grow at high speed. Statistics
show that the 14% of the world's population that lives in the countries (Canada, France, Germany,
Italy, Japan, Russia, the UK and the US) accounts for 34% of the world's total mobile users. (ITU,
2004) this statistics shows that telecommunication industry does not.

3.5.1 Indian Telecom Industry

India is currently the world’s second-largest telecommunications market and has registered strong
growth in the past decade and half. The Indian mobile economy is growing rapidly and will
contribute substantially to India’s gross domestic product (GDP), according to report prepared by
GSM Association (GSMA) in collaboration with the Boston Consulting Group (BCG).
The liberal and reformist policies of the Government of India have been instrumental along with
strong consumer demand in the rapid growth in the Indian telecom sector. The government has
enabled easy market access to telecom equipment and a fair and proactive regulatory framework
that has ensured availability of telecom services to consumer at affordable prices. The deregulation
of foreign direct investment (FDI) norms has made the sector one of the fastest growing and a top
five employment opportunity generator in the country.
Market Size
Driven by strong adoption of data consumption on handheld devices, the total mobile services
market revenue in India is expected to touch US$ 37 billion in 2017, registering a Compound
Annual Growth Rate (CAGR) of 5.2 per cent between 2014 and 2017, according to research firm
IDC.
India's mobile subscriber base is expected to cross 500 million! subscribers by the end of FY2015
from 453 million subscribers at the end of FY2014.
According to a study by GSMA, smartphones are expected to account for two out of every three
mobile connections globally by 2020 making India the fourth largest smartphone market.
The broadband services user-base in India is expected to grow to 250 million connections by 2017,
according to GSMA.
India added the highest number of net mobile phone subscriptions of 13 million during the third
quarter of 2015@.

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International Data Corporation (IDC) predicts India to overtake US as the second-largest smart
phone market globally by 2017 and to maintain high growth rate over the next few years as people
switch to smart phones and gradually upgrade to 4G.
In spite of only 5 per cent increase in mobile connections in 2015, overall expenditure on mobile
services in India is expected to increase to US$ 21.4 billion in 2015, led by 15 per cent growth in
data services expenditure, as per research firm Gartner.
The Indian telecom sector is expected to generate four million direct and indirect jobs over the next
five years according to estimates by Randstad India. The employment opportunities are expected to
be created due to combination of government’s efforts to increase penetration in rural areas and the
rapid increase in smart phone sales and rising internet usage.
Investment
With daily increasing subscriber base, there have been a lot of investments and developments in the
sector. The industry has attracted FDI worth US$ 17.7 billion during the period April 2000 to
September 2015, according to the data released by Department of Industrial Policy and Promotion
(DIPP).
Some of the major developments in the recent past are:
Walmart India Private Limited's president has shown interest in opening its chain of stores in
Haryana, while Micromax has also offered to set up a mobile handset manufacturing unit in the
National Capital Region (NCR).
Vodacom SA, a subsidiary of Vodafone Plc, has entered into an agreement with Tata
Communications Ltd to buy the fixed-line assets of Tata Comm's South African telecom subsidiary
Neotel Pty Ltd.
Bharti Airtel has planned to invest Rs 60,000 crore (US$ 9.02 billion) over a period of three years
with a view to boost its telecom network capacity thereby improving the quality of voice and data
services to its customers.
Reliance Communications Ltd, India’s fourth largest mobile services provider, has agreed to
acquire Sistema Shyam Tele Services Ltd (SSTL), the local unit of Russian company Sistema
JSFC, in a deal valued at Rs 4,500 crore (US$ 687 million), which includes payments to the
government for spectrum allotted to Sistema.
Videocon Industries Ltd plans to set up a mobile handset assembly plant along with manufacturing
set top boxes in Punjab for an investment of Rs 500 crore (US$ 76.7 million) over three years.
American Tower Corporation, a New York Stock Exchange-listed mobile infrastructure firm, has
acquired 51 per cent stake in telecom tower company Viom Networks in a deal worth Rs 7,635
crore (US$ 1.17 billion).
Chinese smart phone maker One Plus has announced its partnership with Foxconn, a Taiwanese
company, for assembling its phones in Foxconn's factory in Andhra Pradesh.
Swedish telecom equipment maker Ericsson has announced the introduction of a new radio system
in the Indian market, which will provide the necessary infrastructure required by mobile companies
in order to provide fifth-generation (5G) services in future.
Out of the total number of smart phones shipped in India during the June 2015 quarter, 24.8 per
cent were made locally - a significant rise as compared to 19.9 per cent in the previous quarter - as
per Cyber Media Research firm.
Global telecom equipment makers like Ericsson, Nokia Networks and Huawei are looking forward
to over US$ 1 billion revenue opportunity as mobile phone operators in India roll out high-speed
broadband services on the 4G LTE technology across the country.
Lenovo Group of China has commenced manufacturing its smart phones in India, through its
contract manufacturer Flex’s facility near Chennai, thus becoming the largest Chinese company to
follow ‘Make in India’ strategy.
Foxconn, the world’s largest contract-manufacturing firm for consumer electronics and
manufacturer for Apple products, has signed a Memorandum of Understanding (MoU) with
Maharashtra state government to invest US$ 5 billion over the next three years for setting up a
manufacturing unit between Mumbai and Pune.
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Government Initiatives

The government has fast-tracked reforms in the telecom sector and continues to be proactive in
providing room for growth for telecom companies. Some of the other major initiatives taken by the
government are as follows:
The Telecom Regulatory Authority of India (TRAI) has directed the telecom companies or mobile
operators to compensate the consumers in the event of dropped calls with a view to reduce the
increasing number of dropped calls.
With a view to encourage consolidation in the telecom sector, the Government of India has
approved the rules for spectrum trading that will allow telecom companies to buy and sell rights to
unused spectrum among themselves. The Union Cabinet chaired by the Prime Minister, Mr
Narendra Modi, gave its approval to the guidelines on spectrum sharing, aimed to improve spectral
efficiency and quality of service, based on the recommendations of the Telecom Regulatory
Authority of India (TRAI).
The Central Government’s several initiatives to promote manufacturing in the country, such as
‘Make in India’ campaign appears to have had a positive impact on mobile handsets manufacturing
in the country. Companies like Samsung, Micromax and Spice had been assembling handsets in the
country already. Xiaomi and Motorola, along with Lenovo have also started assembly of
smartphones in India. Firms like HTC, Asus and Gionee too have shown interest in setting up a
manufacturing base in the country.
The Government of India plans to roll out free high-speed wi-fi in 2,500 cities and towns across the
country over the next three years. The program entails an investment of up to Rs 7,000 crore (US$
1.06 billion) and will be implemented by state-owned Bharat Sanchar Nigam Ltd (BSNL).
Road Ahead
India will emerge as a leading player in the virtual world by having 700 million internet users of the
4.7 billion global users by 2025, as per a Microsoft report. With the government’s favourable
regulation policies and 4G services hitting the market, the Indian telecommunication sector is
expected to witness fast growth in the next few years.

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 CHAPTER 4

RESEARCH METHODOLOGY

Research Methodologies

In this chapter the methodological approaches used in order to reach the purpose and
answer the research questions’ description. All of the steps are explained one by one to
give an overview of how the data have been obtained and treated.

4.1 Research philosophy

We probably think of research as something very abstract and complicated. It can be, but
you'll see (I hope) that if you understand the different parts or phases of a research project
and how these fit together, it's not nearly as complicated as it may seem at first glance. A
research project has a well-known structure -- a beginning, middle and end. We introduce
the basic phases of a research project in The Structure of Research. In that section, we
also introduce some important distinctions in research: the different types of questions you
can ask in a research project; and, the major components or parts of a research project.
Research philosophy is a vast topic and here we will not be discussing this topic in great
details. In business and economics dissertations at Bachelor’s level, you are not expected
to discuss research philosophy in a great level of depth, and about one page in
methodology chapter devoted to research philosophy usually suffices. For a business
dissertation at Master’s level you may need to provide more discussion of the philosophy
of your study, but even there, about two pages of discussions has to be accepted as
sufficient by your supervisor.
The research philosophy will reflect the author’s important assumptions and these
assumptions are base for the research strategy. Generally, research philosophy has many
branches related to a wide range of disciplines. Within the scope of business studies in
particular there are two main contrasting research philosophies – positivism and
phenomenology.

4.2 Research Purpose

As you probably already know, there are many reasons why research is done. But what
are its purposes? Why bother with all the different styles, techniques, experiments and
measurements?
Why did the first sailors, the ones before Columbus and Magellan, hop on their little
canoes and paddle out? Humans naturally explore the world around them, wanting to
learn about the planet we have labeled Earth.
Why did Hippocrates and Galen examine and write about the maladies of man? The need
to describe and understand our world is found in even the youngest children.
Why did we develop an entire group of sciences to understand humans? Because what
good is being human if you cannot explain why we do something. Maybe I am being a little

9
to 'meta' about all this. The purpose of psychology is to explore, to describe and to explain
how and why a person thinks, feels and acts.

4.2.1 Exploratory Rsearch

Exploratory research is defined as the initial research into a hypothetical or theoretical

idea. This is where a researcher has an idea or has observed something and seeks to
understand more about it. An exploratory research project is an attempt to lay the
groundwork that will lead to future studies, or to determine if what is being observed might
be explained by a currently existing theory. Most often, exploratory research lays the initial
groundwork for future research.
To make this a little more understandable, imagine you are blindfolded or placed into a
room without light. You are not told if something is in the room, but you have a suspicion
there is something in there. You shuffle out slowly into the room, exploring with the tips of
your fingers until you find something.
Exploratory research can come in two big forms: either a new topic or a new angle. A new
topic is often unexpected and startling in its findings. For example, American psychologist
John Watson really began his behaviorism research with a new topic on the study of
human behaviors and learning: rats! Because humans have brains and rats have brains, it
makes a certain kind of sense. There was an attempt to find the universal laws of learning
in all brains.
New angles can come from new ways of looking at things, either from a theoretical
perspective or a new way of measuring something. For instance, computers have allowed
large populations to be looked at. Old experiments can now involve thousands of people
from around the globe instead of a few people from the local train station.

4.2.2 Descriptive Research

Once the groundwork is established, the newly explored field needs more information. The
next step is descriptive research, defined as attempts to explore and explain while
providing additional information about a topic. This is where research is trying to describe
what is happening in more detail, filling in the missing parts and expanding our
understanding. This is also where as much information is collected as possible instead of
making guesses or elaborate models to predict the future - the 'what' and 'how,' rather
than the 'why.'
Remember that room you're blind in? Descriptive research is the act of exploring the thing
in the dark, creating a fuller picture of what you are looking at. It is not quite as tentative as
exploratory, but you still are not 100% sure what you've found, although you're starting to
get an idea. You begin to fill in what you know with what you find.
A psychological example is the use of CT scans, MRI, fMRI, PET, and SPECT imaging to
describe the living brain. We now have the clearest picture in all of history of the thinking,
living brain. Just a few decades ago, a person who wanted to look at a living brain had two
options: a really blurry CT scan without any detail or to crack open the skull and peel back
the protective layers around the brain.
Both options are better than a century ago, where you kind of had to wait for someone to
die to examine their brain. Research over the last few decades has been expanding our
understanding, providing descriptions of the active processes in the brain.
One field that is quickly growing is the field of forensic psychology. Over the last few
decades, studies exploring the decision making process of police officers, the techniques
used to question witnesses and the jury processes are all being examined. There has
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been an active interest in many researchers to explore the field that the judicial system
needs.
For instance, looking into eyewitness memory studies reveals research explaining and
describing the factors that influence what people see. For example, did you know that a
person with different lights shining at different angles on a person's face can alter a
person's entire look, including their ethnicity? How about that even in broad daylight,
people still get gender of perpetrators and victims mixed up?

4.2.3 Explanatory Research

We began exploring something new with exploratory research. Then, we conducted

descriptive research to increase our knowledge of it. Lastly, we need to explain it.
Explanatory research is defined as an attempt to connect ideas to understand cause and
effect, meaning researchers want to explain what is going on. Explanatory research looks
at how things come together and interact. This research does not occur until there is
enough understanding to begin to predict what will come next with some accuracy.

4.3 Research Approach

Research approach can be divided into two groups: deductive and inductive. The
relevance of hypotheses to the study is the main distinctive point between these two
approaches. Deductive approach tests the validity of assumptions (or
theories/hypotheses) in hand, whereas inductive approach contributes to the emergence
of new theories and generalizations. Discussion of research approach is a vital part of any
scientific study regardless of the research area. Within the methodology chapter of your
dissertation to you need to explain the main differences between inductive and deductive
approaches and specify the approach you have adopted for your research by breaking
down your arguments into several points.
 Main distinction between inductive and deductive research approach relates to the
existence and placement of hypotheses and theories. Specifically, if the researcher adopts
a range of hypotheses the research is aimed to explore, then it will be deductive research.
On the other hand, if hypotheses are absent at the start of the research then it will be the
case of inductive research.
 In other words, the relation of hypotheses to the study can serve as the main point of
difference between these two approaches. Specifically, it has been noted that “two
important functions that hypotheses serve in scientific inquiry are the development of
theory and the statement of parts of an existing theory in testable form” (Singh and Bajpai,
2008, p.11).

4.4 Research Strategy

Research ethics is not a one size fits all approach. The research strategy that you choose
to guide your dissertation determines the approach that you should take towards research
ethics. Even though all dissertation research at the undergraduate and master's level
should adhere to the basic ethical principles of doing good (i.e., beneficence) and doing
no harm (i.e., malfeasance), this does not mean that the approach you take towards
research ethics will be the same as other students. Rather, the approach to research
ethics that you adopt in your dissertation should be consistent with your chosen research
strategy. Since your research strategy consists of a number of components, the approach
you adopt should reflect each of these components.

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In our Research Strategy section, we introduce these major components, which include
research paradigms, research designs, research methods, sampling strategies and data
analysis techniques. Whilst all of these components can have ethical implications for your
dissertation, we focus on research designs, a couple of research methods, sampling
strategies, and data analysis techniques to illustrate some of the factors you will need to
think about when designing and conducting your dissertation, as well as writing up the
Research Ethics section of your Research Strategy chapter (typically Chapter Three:
Research Strategy).

4.5 Sample Selection

In this research there is no possibility to collect or analyze the data available owing to
restrictions of time, money and often access. Sampling techniques provide a range of
methods that enable you to reduce the amount of data you need to collect by considering
only data from sub-group rather than all possible cases or elements.
The sampling techniques are divided into two types which are probability or representative
sampling and non-probability or judgemental sampling.
The population of interest was defined as the Iranian top managers, business managers
or marketing managers of telecommunication companies who provides servic. sample
was taken from the database of Iranian Telecommunication syndicate who had past
relationship with our company. To ensure the survey sample represents the population,
non-profitability sampling method was adopted.
In this study the empirical research focuses on services because the interpersonal nature
of services makes them particularly well suited for relationship building (Berry, 1995).
Certainly, a relationship with a service provider is particularly valuable to the customer
because it engenders the trust that is neccesary to ensure quality service and preserve
the relationship and because many servers require the interaction between customers and
service providers.

4.6 Measurement & Tests

4.7 Data Collection

Questionaries are administrated in different ways depending on the amount of contact with
the respondents. Questionaries can be self-administered. "online", "postal" and "delivery
and collection" questionaries are among self-administered ones. They can sldo be
interviewer administered, e.g., telephone questionaire and structured interview (saunders
et al., 2000). In this study a delivery and collection questionaire was used. However, in
some limited cases according to the time restriction of the managers, I enjoyed using
telephoen and email survey.
There were 120 questionaires distributed. 105 quetionaries were collected. And 4 of them
were poorly answered as 101 were reliable to use. This indicated 87% response rate. As
respondents were first asked whether they wish to answer the questions or not and also
due to the prior working relationship with those managers and remaining them of filling
questionaire so mant times, the response rate was high.

4.8 Statistical Analysis

In this research the data analysis was done by using the PLS (Partial Least Square) which
is one of the SEM techniques, structural Equation Modeling (SEM) technique like LISREL

12
and Partial Least Square (PLS) are second generation data technique that is used to test
the extent to which IS research meets recognized standards for high quality statistical
analysis (Gefen, 2000). By menas of SEM . researchers could answer a set of interrelated
research questions in a single, systematic and comprehensive analysis by simultaneously
modeling the relationship among multiple and dependent contructs. This capability of
simultaneous analysis differs greatly from most first generation regression models such as
linear regression, ANOVA and MANOVA, which can analyze only one layer of linkages
between independent and dependent variable at a time.

4.9 Chapter summary

Inthis study the quantitative research approach was selected, and the measurements of
constructs were developed according to prior studies. The pilot test was run and target
population has been defined. A sample of 120 small and mediuim sized enterprises was
defined by using database of our company including the past purchase and selecting them
according to past purchase relationships with them. The contact person was usually the
owner of the business or top level manager and in some cases the experts in that
company who had more work experience than others.105 questionaries were gathered
after data filtering to eliminate invalid responses the number of questionaries decreased to
101 so the response rate is 86% Structural Equation Modeling was selected for statistical
analysis.
Structural Equation Modeling multivariate technique combining aspects of multiple
regression for examining dependence relationships and factor analysis for representing
unmeasured concepts with multiple variables was used to estimate.

13
 CHAPTER 5

Data Analysis

This Chapter provides demographics and descriptive statistics; reliability and validity
assessment and the results of hypothese tests are delivered. The software are being used
to arrive at statistical results

5.1 Survey Response

Questionnaires were filled by Indian Telecom companies’ managers; the total sample size
was 105 which 101 of them completed but 4 of them was poorly answered.

Measure Items Frequency Precent

Male 86 85.14
Gender Female 15 14.85
Total 101 100
30-35 14 13.86
35-40 29 28.71
40-45 40 39.60
Age 45-50 6 5.94
50-55 3 2.97
55-60 5 4.95
60-65 4 3.96
Total 101 100
Bachelor 54 53.46
Education Masters 44 43.56
PHD 3 2.97
Total 101 100
Eng 35 34.65
Technical Manager 37 16.83
Business Manager 3 2.97
Position Project Manager 14 13.86
Marketing Manager 10 9.90
CEO 22 21.78
Total 101 100
Sales & 34 33.6
installations
Contractor 31 29.70
Field Of Work General Contractor 3 2.97
Subcontractor 12 11.88
Research & Design 10 9.90
Solutions 11 10.89

14
 Total 101 100

5.2 Models

5.2.1 Market positions

One approach if the product is conducive to it is to build one of those "magic quadant" type charts.
A simple example is the automobile industry where positions are typically carved out based on
some permutation of either cost or quality. So, Y axis is cost and X axis is quality and you put the
little dots for each model somewhere within that chart (e.g., upper right would be high quality/high
price and lower right would be high quality/low price).

But in general, communicating positioning is really a non graphical process:

1 Establish demonstrated relevant positions in the marketplace

2 Analyze what positions companies are taking (don't be shocked if many of them take the same
one--it's always fun to see how many companies claim the leadership position)

3 Evaluate your own strengths (SWOT analysis works OK here)

4 See which which strengths match up to market-relevant positions that are not successfully owned
by a competitor.

5 Run with it.

5.2.2 Customer’s Perception

Measuring customer perception gives an indication of what people like about your
construction organisation, what they do not like and, of equal importance, their areas of
ignorance.
The market’s perception of a company has an impact on its performance and shareholder
value. It will also impact on what people are prepared to pay for its construction products
and services. These perceptions are based on how the company performs and its
communication with the market.
Conducting regular perception studies is a valuable way to stay in touch with your
customer base.
Based on this a communications plan can be developed, and possible changes made to
your construction business strategy.
The benefits of completing a regular customer perception study:
It enables fact-based decision making
Helps you understand what customers like about your company and why
Identifies opportunities for improvement
Prioritises changes based on customer feedback
Strengthens your customer relationships

15
Measures effectiveness of advertising and PR programmes
Develops a focused and effective communications programme
Benchmarks you against your competitors

 
How the process works:

Competitive Advantage work with you to understand your company values, performance
and communication challenges. Taking the factors that you believe to be important and
drawing on our experience we recommend a questionnaire structure. Having got your
approval, we then test this with a few respondents to ensure it is working as intended.

The survey

We have found telephone interviews to be the most cost effective and reliable method of
research. If there are some complex issues or important customers, we can include face-
to-face interviews in the research process.
The range of research methods can include:
online surveys
telephone interviews
face-to-face interviews
focus groups

Who we contact

Based on your channels to market and customer mix we will recommend a sample of
representative size and mix. We will ask you to provide us with your customer lists and we
can also source appropriate lists of non-customers.
Presenting the findings
Reporting is factual, but includes a series of commercial recommendations based on
extensive practical construction industry sales and marketing experience.

5.2.3 Customers’ Loyalty

Customers make decisions about where to spend their time, money, and effort every day.
They might be business buyers between 9 to 5, but consumers the rest of the time. In
either case, the scenario is always the same for the seller – to make their product or
service offering the preferred choice. They do this by building offers that will:
Differentiate them from competitors
Generate significant demand by customers
Demonstrate superior value
Build customer loyalty
Loyalty is more than just behavior
It is a fallacy to assume that a customer is loyal just because they continue to buy from you. There
are many reasons why a customer repeats purchasing which have little to do with being really
loyal. Consider the following:
There is a contractual arrangement with your company
16
It takes too much effort or money to change suppliers
You are currently the low cost provider
Their relationship is with one of your employees and not with your company
Habits are hard to break
They may actually be in the process of finding an alternative supplier
If any of the above is the case, what do you think is likely to happen should a desirable competitor
come around and seek out your customer’s business? The easier and more attractive they make it
for the customer to switch, the less appealing the above reasons are. Customer loyalty is far more
than repeat business.
Loyalty can be defined as a customer continuing to believe that your organization’s
product/service offer is their best option. It best fulfills their value proposition whatever that may
be. They take that offer whenever faced with that purchasing decision.
Moreover, loyalty means hanging in there even when there may be a problem. This occurs because
the organization has been good to them in the past and addresses issues when they arise. It means
that they do not seek out competitors and, when approached by competitors, are not interested. It
also means being willing to spend the time and effort to communicate with the organization so as to
build on past successes and overcome any weaknesses.
In a nutshell, loyalty means a customer wants to do business with you and does.
The challenge for organizations is taking this definition and translating it into actual practice, where
specific actions are defined and ideal customer relationships are envisioned. It also means
identifying a means for taking this loyalty construct and putting it into measurable terms so that
success and failure can be assessed and progress or decline tracked.
Customer Loyalty can be Measured and Monitored
Loyal customers believe the products and services purchased from their supplier are superior to
those of the competition. Frequently, they are customers who view their interactions as more than
simply transactional. They believe there is a relationship that is bigger than just the products or
services they buy. Measuring loyalty means measuring the strength of this relationship between
buyer and seller, between the organization and its customer.
It is challenging to measure the level of customer loyalty within the relationship, which is
why companies so often succumb to simply defining loyalty as the number of purchases
made or a continuing pattern of buy behavior. And asking the customer directly about
whether or not they are ‘loyal’ does not provide a valid measure. Customers will often say
they are loyal – simultaneously– to multiple providers.
What we are looking at is measuring those attitudes as well as behaviors that we know
make up this concept of loyalty. For example, some of the important attitudes and
behaviors expected of a loyal customer include:
Likelihood to recommend your products and services to others
Likelihood to continue purchasing your products and services, at minimum, at the same
level
Likelihood of purchasing other products and services you offer
Believing your products and services are superior to others offered in the marketplace
Not actively seeking alternative providers to replace you
Providing your company with opportunities to correct problems and not using these as a
basis for compromising the relationship
Based on customers’ responses to questions such as these as well as others that evaluate specific
aspects of their relationship with your company, a loyalty profile of your customers can be created.
Loyalty segments categorize customers as Loyal, Neutral and Vulnerable.
The basis for loyalty segmentation should be sufficiently flexible in that it recognizes and accounts
for the uniqueness and special challenges of any one business or organization as well as the
environment in which it competes. And yet must also be based on sound, well-tested research
principles and validated modeling.

17
Business success means having desirable customers who are strongly tied to your organization.
Monitoring the number/percent of your customers in the Loyal segment and doing what it takes to
increase loyal customers while decreasing those who are vulnerable should provide the focus of any
organization.
Profiling Loyalty Segments
Once the customer loyalty segments are formed, complete profiling based on meaningful customer
descriptors, is provided. (Such information is usually available from organizations’ customer
databases and other internal customer data sources). Comparison of the segments across the loyalty
profile can reveal significant – and potentially valuable – differences which would otherwise have
remained hidden.
The example shown here is a business to business customer loyalty profile. Note that the diversity
across loyalty types is not unusual. For this company, it was very helpful to learn, for instance, that
their West coast customers were far more vulnerable. While at a very early point in their analysis,
this finding — coupled with the market share potential– suggested the possible need for
organizational restructuring.
Loyal Neutral Vulnerable
Segment Size 23% 46% 31%
Average Annual Expenditures $25,900 $18,400 $20,100
Share of Expenditures Received 62% 39% 19%
Percent of Product Line Purchased 38% 20% 11%
Average Size of Customer
Medium Medium/SmallLarge
Organization
Location East/MidwestSW/SE West
Critical Needs Product Line Delivery Time Order Cycle
But demographic and descriptive profiling is just part of the information required for
organizations to manage customer loyalty. Organizations need to know why loyalty
segments exist – why are some customers loyal and others vulnerable or just plain in
between neutral towards you? And they need to hear this information directly from the
customer – not management’s best guesses or gut level feelings. Without customer input,
organizations are held hostage to a loyalty goal that has no answers.
Understanding the Loyalty Segments
So what causes one customer to be loyal and another to be almost out the door? The creation of the
loyalty segments assigns each customer to a segment but does not provide any explanation as to
why they are in that particular segment. To implement change that is directed towards improving
customer loyalty — in other words to manage loyalty – requires in-depth understanding of:
Customers’ underlying preferences for the products/services being considered
What customers value in those products and services under consideration
Customers’ experiences, perceptions, and beliefs about the organization itself as well as about its
products and services – particularly in areas that are highly valued
The Loyalty Research Center has developed a model that describes how daily interactions (as
perceived by the customer) between customer and provider will ultimately drive overall company
perceptions and lead to attitudes of loyalty (or not) and behavior.
Applying this loyalty model to individual companies requires breaking down the customer
relationship into its various aspects – starting with day to day activities and ending with important
attitudes, known to influence loyalty. Identification of organization-specific model elements
generally begins with an Investigative Phase. This phase identifies all potentially relevant reasons
for customer loyalty and becomes the basis for subsequent qualitative measurement.
Understanding how customers perceive all aspects of company performance and
quantifying the impact of each on overall customer loyalty is vital to identifying critical
actions to take.

18
 The basic model elements appear in the
accompanying diagram and represent these interactions, experiences and attitudes that
ultimately drive your businesses’ success.
In addition to gathering performance feedback and perceptions, customers are asked to
share any problems they may have experienced, as well as the extent to which they were
resolved.
The following table includes actual results for one company. Note that several pieces of
important information are included: Loyalty impact priority, performance ratings (ratings of
Excellent and Very Good), and problem experience for each Loyalty Segment:
Loya
Impact Level NeutralVulnerable
l
% who experience
12% 18% 41%
problems
% of problems unresolved 10% 23% 64%
Top 2 Box Evaluations
Order cycle time 1 64% 67% 39%
Desired delivery time 2 71% 41% 44%
Overall sales 3 78% 62% 53%
Overall customer service 4 82% 55% 49%
From this one chart, there were many learnings our client gathered; but first and foremost
they learned that…
“Loyal customers’ experiences and perceptions are distinct from those of Neutral
customers. There is yet an even greater gap between those identified as Loyal versus
Vulnerable.”
Here are just a few of this client’s discoveries:
Problems are experienced and remain unresolved far more often by the Vulnerable
segment in comparison to others.
Loyal customers have a low percentage of outstanding problems. This is not an unusual
finding. Note that it is not zero. Some loyalty customers experience significant problems.
That means that the overall strength of relationship and the company’s performance in
other areas is able to retain these customers’ loyalty.
Interactions are listed in priority order in terms of their impact on loyalty. It was a surprise
to find that Order cycle time carries the impact that it does and that it scores so weakly
across all segments, but especially among vulnerable customers.
Other areas of interaction also revealed considerable differences among the segments.
Consistently, Loyal customers’ perceptions are most positive.
Also noted by our client was the fact that the majority of customers did not fall into the
Loyal category!
Taking Action
The previous chart provides just an inkling of the rich information that is potentially available from
customers. As in the case above, companies are likely to find vast differences among their customer

19
loyalty segments in terms of perceptions, experiences, and attitudes. The question now becomes –
What do you do with all this good information? Undoubtedly, the first thing to do is to understand
why differences exist.
Variations among segments can be the result of:
Inconsistent levels of service and/or product quality provided
Customers have different priorities
Customer needs or expectations vary
In each of these cases – whether it be actual performance differences on the part of the
provider, or different demands on the part of the customer, customer loyalty levels are
likely to be affected. In the first two scenarios, the provider is able to self-correct by
focusing on those areas of weaker performance – especially where it counts the most – as
revealed in the customer feedback results.
However, if customers’ needs/expectations are sufficiently different from what the provider
is capable of offering, then improving the performance of current offerings may not be the
answer. A provider’s business model may not coincide with the demands of every
customer segment. Needs-based segmentation technique will be required to determine
whether or not you are serving the wrong customers for your business model. Needs-
based segmentation is discussed in a separate piece.
For now, let’s assume a simpler scenario where all customers have similar needs and the
actions to take are related to performance improvement.
Using the earlier example, we know that their actions focused on:
Increasing the base of loyal customers
Improving weaker areas of greatest importance to customers across the board
Reviewing identification of specific customers in the Loyal and Vulnerable segment
Determining which customers are most important – to the business- and assuring that
their performance concerns were addressed
A plan to increase the base of loyal customers was put into place along with specific
targets. They would start by improving those areas most important to customers where
loyal customer perceptions reveal that there is room for performance improvement. Their
message out to the entire company was:
Overall, results clearly point to the fact that while the Loyal segment generally scores
highest across the board, it is also true that Loyal customer scores could be even better.
In no area do all Loyal customers give either an Excellent or Very Good rating. Or, how
about setting an expectation for reaching all Excellent?
Special, targeted efforts to achieve the above were designed, sometimes, around each
identified loyal customer.
There were also plans to further investigate which customers fell into the Neutral or
Vulnerable groups. That, in turn, helped determine next actions. What would it take to
address a Vulnerable customer’s specific concerns and was the effort worth it? It was
important that improvement efforts were considered reasonable given the desirability of
that customer to their business.
As a general rule, a good plan of action includes reviewing (especially within the
Vulnerable segment) lower performing areas with an eye toward the following:
Customers – Are these the wrong customers for your business? Are there customers who
do not value the business model under which your organization operates? Will the
customer ever change their negative perceptions and what would this take?
Perceptions – Do management and employees believe that scores should be higher, i.e.,
customer perceptions should be better? And what do prospects believe?
Drill down – Is there sufficient and specific enough information such that there is an
understanding of what customers are expecting/asking for? Is there need for further
clarification from customers in order to better understand their perceptions? Could
qualitative discussion groups help the level of understanding?
20
Performance – Is performance lacking in one or more areas? Is there a well-defined process? Is the
process being implemented correctly? Do employees understand the process? Have the right
managers and employees been hired to execute the process? Can technology improve the quality
and/or speed of the process? Who is responsible for the process? Is it time for an overhaule
Competition – Are some customer perceptions being driven by what others are able to
provide within or outside this industry? How are our competitors able to provide a better
experience?

5.3 Chapter Summary

This chapter presented the results of data analysis. Respondents’ profile has been given in the
beginning of the chapter. Structural Equation Modelling using various techniques have been
employed to test the proposed research model.
Significance test for all paths were conduscted using the sampling procedure,the structural path
analysis of the research model provide support to 7 hypotheses. Then the research questions of the
thesis have been answered.

21
 CHAPTER 6

Findings and Conclusions

In this chapter the theoretical and practical implications of thesis are presented. The limitations
and managerial contributions of this research will be mentioned and future researches will be
suggested.

6.1 Implications

6.1.1 Theoretical

The research provides both theory development implication for academics and practical implication
for managers and executives. The main contribution to theory development involves the
confirmation of some hypothesized relationships among construct s of customer relationship
marketing strategies-attraction activities, loyalty and interaction programs- and market performance
which will be customers' perception, market position and customers' loyalty in Iranian
telecommunication companies.
As explained above in chapter two, the relationship marketing includes all activities regarding the
establishment , developmenr and maintenance of relationships (Morgan and hunt,1994). There are
three types of relationship marketing activities that oriented to attract customers, to retain and the
others oriented to maintain the relationship, according to Izquierdo et al.,(2005). Loyalty and
interaction programs defined as activities refer to holding back to existing customers and retaining
them ( contact them and aswering their complaint) which will be enhance personal and friendly
relations with the customers . So they proposed four variables which bonus, contact customer
satisfaction and compalint forming the concept of loyalty and interaction programs. All of these
four constructs provide close and successful relationships. Therefore due to this point of view in
this chapter trhe term loyalty and interaction programs used instead of bonus, satisfaction, contact
and complaint.

6.1.2 Practical

Researchers' findings are of particular importance to managers who are responsible for developing
and implementing strategies. These findings will help corporations understand the effectiveness of
relational exchange from the firms' perspective, and develop appropiate relationship marketing
strategies accordingly.
Inspite of the findings, positive impact of customer perception, loyalty and interaction programs on
the extent to which customers are loyal about the company has been confirmed. For this reason,
service providers should prioritize appropiate actions to get loyal customers.

6.2 Contributions

Due to this fact that industrial service quality is more appropriate for this research area, I substitute
INDSERVE construct to mmeasure the B2B service quality in model instead of servqual which is
customer side and not appropriate for B2B context.

22
6.3 Limitations

There are number of limitations associated with this study. First, obtained data were from the
managers’ perspective and we have not taken into account the customers’ point of view due to the
limited number of customers in the industry.
Second, we have focused only on a service sector and we have only considered telecommunication
service providers. It would be useful to obtain a broder sample selection.
Third, cross-sectional data were used to test the association of relationship marketing activities with
market performance, although it is important to mention that the study provides only a snapshot at a
single point in time.

6.4 Future Prospects for the research

Future research is mainly based on the current limitations; therefore, future research wil seek to
generalize the model developed in this study to other services. Also although the sample size 101
which are adequate and theoretically acceptable but the results show that increasing the sample
size will increase the accuracy of these results.

23
 CHAPTER 7

Appendix A: Questionnaire

1 2 3 4 5 6 7
Attraction Programs
Industrial service Quality (INDERSV)
Potential Quality

1- you potentially offer full service to your customers(in your

technical field)
2- Your company potentially has the ability to employ required
personnel
3- Your comapny potentially has the ability to purchase required
facilities
4- Your company has the requiured manegement philosophy
5- Your company has the low personnel turn-over
6- Your company potentially can join network partners and
associates

Hard Process Quality

7-The comapny keeps time schedules

8- The company stays in (Honor) financial agreements
9- The comapny holds the required budgets
10- The project finalization meets deadline
11- The company looks at details
12- The company does not understand customers' needs

Soft Process Quality

13- The comapny listens to customers' problems

14- The comapny is open to offer suggestions/ideas
15- Managers and personnel possess pleasent personality
16- You Argue with the customers if neccesary
17- The company respects customers' needs

24
 Output Quality

18- The company reaches predetermined objectives after each

project
19- The company has a notable effect on their customers
20- The company contributes to their customers' sales/image
21- Are you creative in terms of your offerings
22- The comapny is consistent with strategy of your industrial
customers

Loyalty and Interaction Programs

Bonus

23- The Company offers price reductions to existing customers

24- The comapny offers free consultancy to existing customers
25- The comapny offers daily project progress reports

Personalized Relationship

26- The company provides customized services according to

existing customers' needs

Personal Contact

27- The comapny contacts customers to remind them of future

services
28- The company contacts customers to verify if they are
satisfied
29- The company Contacts former customers to find out why
they do not still stay loyal to their comapny

Satisfaction

30- The company is concerned about having satisfied customers

31- The company makes efforts to meet deadlines in order to
satisfy customers
32- If customers' satisfaction requires more expenses, the
company incures them

25
 Complaints

33- Customers' Complaints are handled individually by those

responsible for it
34- The comapny is concerned about answering customer
complaints
35- The company undertakes corrective actions to avoid situation
that have
Customers' Perception
Please rank your customers' perception about the company
in the following questions

Expert Image

36- High reputation of the company

37- Employers' technical skills
38- Servive quality

Convenience image

39- Proximity to the customer

40- Comapny's response rate to the customer
41- Respectful behaviour to the customer

Promotional image

42- Advertising
43- Promotions and price reductions
44- Customers' valid friendly relationship with employees
45- Customers' valued personalized treatment
46- Trust in companys' manager is important for (industrial)
customers
47- Friendly relationships between managers of both sides are
important to the customer view

Market Position

26
48- After the implementation of attraction and loyalty programs the
company is more known than others
49- After the implementation of attraction and loyalty programs the
number of customers has increased

Customer Loyality

50- The company already holds loyal customers before

implementing attraction and loyalty programs
51- Increase in loyalty percentage of loyal customers after
implementation of attraction and loyalty programs
52- Increase in the percentage of incomes associated with loyal
customers are the implementation of attraction and loyalty programs

27