The value added by specific investments: a framework for managing relationships in the context of value networks

Abstract

Purpose

Economic theories applied to the study of buyer‐seller relationships draw to a large extent on the problems caused by specific investments. This contribution aims to develop a new perspective on specific investments that accounts for their value‐adding character and also to present a transaction‐centred definition of customer relationships.

Design/methodology/approach

The contribution draws on a comparative review on literature on business networks and economic theories focused on industrial buying behaviour.

Findings

Provides a transaction‐related definition of customer relationships in order to distinguish between different kinds of relationships and provides a framework to how relationship management is able to enhance marketing activities.

Practical implications

Specific investments are a powerful tool for differentiating the market offerings of a company. One central implication is for managers to realise on which stage of the market arena such differentiation is likely to be successful: transaction, relationship, segment or value network. This is the starting‐point for investing in a relationship portfolio conducive for the value generation of the company.

Originality/value

The paper shows that the value potential generated by specific investments is not fulfilled in the realms of present marketing literature. Also it is the first contribution to present a framework capable of treating phenomena of customer relationship management, relationship marketing and network marketing on the same footing, while still respecting the original motivations of those approaches.

Citation

Kleinaltenkamp, M. and Ehret, M. (2006), "The value added by specific investments: a framework for managing relationships in the context of value networks", Journal of Business & Industrial Marketing, Vol. 21 No. 2, pp. 65-71. https://doi.org/10.1108/10610420610651287