Editor’s note: Kevin Schulman is senior vice president at TRG iSKY, a Laurel, Md., research firm.

For decades, business has pursued the formula for customer loyalty, but the secret to creating enduring customer relationships remains elusive. Over the years, satisfaction, value and quality have all taken their turn as the key to customer profitability, but one by one each has proven to be a poor indicator of future customer behavior. Costly investments designed to attract and retain customers do indeed improve survey scores but often have limited impact on the bottom line.

One example from the automotive sector shows a .35 bivariate correlation between the J.D. Power Customer Service Index and repeat purchase of the same automotive brand. Experience across industries shows correlation ranges between .25 and .4 - which is only a weak to moderate relationship. Measuring satisfaction without measuring customers’ relationships and how they got that way leaves companies chasing scores that most often don’t predict future behavior.

There is a large body of academic work dedicated to understanding and explaining what contributes to good and bad interpersonal relationships. To summarize, for a relationship to truly exist, interdependence between partners must be evident: that is, the partners must collectively affect, define and redefine the relationship (Hinde 1979). At their core, relationships are purposive, they add structure and meaning in a person’s life (Hinde 1995).

In the marketing world these basic relationship principles - applied to consumers - have become the accepted framework, replacing short-term exchange conceptions (e.g., transactional and episodic customer interactions) for what is required to maximize profitability. The literature on interpersonal relationships often describes (with varying terms) two broad need states necessary for healthy relationships - functional and personal. T...