Transaction marketing is characterised by one off exchanges, brand management, short-term focus, mass markets, mass communication, market share, brand equity and profitability of transaction, (Bickert, 1992).
Relationship marketing is emerging as the new phenomenon, due to technological advances direct marketing is staging a comeback, leading to a relationship orientation. This paradigm of marketing emphasises value creation rather than value distribution, (Sheth & Parvatiyar, 1995).
Relationship marketing is characterised by ongoing exchanges, customer management, long-term focus, personal communication, ongoing dialogue, markets of one, mind share, lifetime time value of customer and customer equity, (Harker, 1999).
Customer profitability is a measure of revenue generated from the consumer less marketing expenses less expenses pertaining to cost-to-serve.
Consumers are important for organizations if they have substantial revenue potential (in terms of profitability) or if they have sizeable relationship potential (by virtue of superior contacts, presence in influential groups or networks and prospective capabilities for becoming opinion and trustworthy leaders who an influence large consumer groups).