Revenue management: the impact on business-to-business relationships

Wang, Xuan Lorna and Bowie, David (2009) Revenue management: the impact on business-to-business relationships. Journal of Services Marketing, 23 (1) . pp. 31-41. ISSN 0887-6045 [Article] (doi:10.1108/08876040910933075)

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Abstract

Purpose - This paper explores the links between revenue management and business-to-business (B2B) relationships and explains how revenue management can both support and damage B2B relationships.

Design/methodology/approach - A single case study method was employed to conduct qualitative research into a company and its key accounts. In-depth data was collected from three divergent sources (company revenue managers, company account managers and nine of the company’s key accounts) through semi-structured interviews, observations and document studies.

Findings - The research findings reveal that from the company’s perspective, managers acknowledge that revenue management has positively influenced the process of identifying and analysing key account activities and conducting contractual decision-making with key accounts. However, from the key accounts’ perspective, revenue management practices were found to have significant negative consequences, which damage trust and undermine long-term relationships and commitment.

Research limitations - Although the research findings cannot be generalized to other service sectors because of the single-case study research method, the implications of this study suggest that the impact of revenue management practice on B2B relationships should be further investigated in a wide range of organizational and industry settings.

Practical implications - The research findings confirm the long-held assumption that revenue management can negatively affect B2B relationships. The benefits of revenue management primarily reward the company, whilst long-term B2B relationship development suffers from the short-term consequences of the company’s opportunistic behaviour.

Original/value of the paper - This paper bridges the gap in the literature between revenue management and key account management. It also explores the conceptual incompatibility between revenue management and a long-term relational approach to B2B relationships and provides evidence to support this proposition.

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