The Customer Relationship Management Paradox: Five Steps to Create a Fairer Organization

Purpose: Favoritism of customers reveals great benefits, as focusing on the most profitable customers ensures better use of marketing resources. Scholars suggest, however, that such favoritism imposes a danger to customer management, potentially creating perceptions of discrimination. We explore the fairness of differential customer management practices and propose a framework contributing to fairer marketing practices with implications for social businesses. Approach: We critically review the literatures on perceptions of fairness and evaluate the customer relationship management (CRM) paradox. Findings: Within our framework, we identify four stages towards fairer customer management practices: (1) generating awareness and diagnosing problems, (2) managing targeted and non-targeted customers, (3) creating emphasis on positive inferences and goodwill, and (4) promoting morality in marketing. Implications: This framework assists firms in incorporating fairness issues in their marketing schemes, improving the well being of both customers and society alike. With increased fairness, all stakeholders will benefit, and it encourages more 'compassionate management.' Contribution: This paper critically reviews related literatures to suggest best practices for overcoming these dangers in a framework involving four phases, and presents an action program comprised of five steps for practitioners to practice fairer customer management