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Guanxi-type relationships (shabakat al-alakat) and relationship marketing : new linkages in the Egyptian SME sector

Shaalan, Ahmed Said Lotfy


Ahmed Said Lotfy Shaalan


Jon Reast


Establishing strong, high-quality relationships with customers can be an important element in conducting business throughout the world, particularly in complex and highly competitive markets. This study attempts to explore and examine the differences and possible linkages between two important approaches to building relationships: guanxi and relationship marketing. Guanxi-type relationships tend to work at the inter-personal level, whereas relationship marketing tends to operate at the inter-organisational level.

Despite the fact that both concepts are well known individually, a dearth of critical comparison remains in academic literature, even though evidence suggests that managers can use the linkages between the approaches to improve customer recruitment and retention. More importantly, although prior research implies an association between guanxi and relationship marketing, to date, no studies have sought to link the two concepts, and therefore a unified model does not exist.

Moreover, hardly any work has been done to explore guanxi-type relationships in the Arab world generally and the Egyptian context specifically, although Hutchings and Weir (2006a, 2006b) highlighted that networks, and in particular guanxi-type relationships, in the Arab world remain insufficiently researched and there is a dearth of literature exploring these. Furthermore, an informed body of knowledge, explaining guanxi-type relationships in the Arab world and comparing the networking styles of China and the Arab world, does not exist.

Informed by these issues, this study attempted to address these research gaps by employing a mixed method design through two phases of research. In the first phase, twenty-one semi-structured interviews were conducted with academics, experts and practitioners in the Egyptian SME sector. The aim of this phase was to explore the nature, meaning and variables of guanxi-type relationships in the Egyptian context, identify the variables of relationship marketing, and define the relationship between these two strands, and how organisations can link them and transform personal relationships into organisational relationships to retain their customers. The data were analysed using qualitative content analysis and Nvivo9 software.

This phase formed the foundation for the second phase, which employed a quantitative research design to collect primary data using 305 self-administered questionnaires from customers of SMEs in Egypt. The aim of the second phase was empirically to test a model that links guanxi-type relationships and relationship marketing and their association with relationship quality and customer retention. Through testing the research model, the study sought empirical evidence for building the organisational types of relationship involved in relationship marketing instead of the personal type of relationship involved in guanxi-type relationships, thereby enhancing customer retention and avoiding the problem of employees taking customers with them, when leaving the company. The data were analysed using SPSS19 and SPSS macros, employing multivariate data analysis techniques including exploratory factor analysis (EFA), multiple regression analysis, hierarchal multiple regression analysis, bootstrapping method and crosstabulation.

The findings of the first phase revealed that guanxi-type relationships in Egypt stem from the principles of Islam and Christianity and have become rooted and embedded in the Egyptian culture. Moreover, the Egyptian type of social network (guanxi-type relationships in Egypt) can be called shabakat al-alakat (network of relationships). Eight characteristics of shabakat al-alakat have been determined: social, personal, intangible, transferable, contextual, emotional, of religious origin, and long-term. In addition, shabakat al-alakat is a multi-dimensional construct that can be measured through five variables affectional bonding, empathy, reciprocity, personal trust and face.

Moreover, the findings of the second phase showed that shabakat al-alakat (guanxi-type relationships in Egypt), relationship investment programmes (financial and structural), relationship marketing and relationship quality have a significant positive relationship with customer retention. The results also highlighted that relationship investment programmes (financial and structural) and relationship marketing have a significant positive relationship with relationship quality. In addition, relationship quality mediates the relationship between relationship marketing and customer retention, as well as relationship investment programmes (financial and structural) and customer retention. Furthermore, the findings confirmed the interaction effect of shabakat al-alakat in the relationship between relationship marketing and customer retention. Overall, the proposed research model was validated.

Three major contributions stem from this research. First, this study contributes to knowledge by establishing and providing a comprehensive framework of all aspects of the social network in Egypt (shabakat al-alakat or guanxi-type relationships in Egypt): its origin; meaning; name; characteristics; variables; advantages and disadvantages and its role in attracting new customers. The second contribution comes from the novel model, which links guanxi-type relationships with relationship marketing and the impact of this link on customer retention. The third contribution comes from introducing a way to transfer the personal type of relationship involved in guanxi-type relationships to the organisational type of relationship involved in relationship marketing and transferring guanxi-type relationships from the uninstitutionalised and interpersonal level to the institutionalised or organisational level.

It is hoped that future research will build on these results so that further avenues can be explored.


Shaalan, A. S. L. (2013). Guanxi-type relationships (shabakat al-alakat) and relationship marketing : new linkages in the Egyptian SME sector. (Thesis). University of Hull. Retrieved from

Thesis Type Thesis
Deposit Date Feb 26, 2018
Publicly Available Date Feb 23, 2023
Keywords Business
Public URL
Additional Information Business School, The University of Hull
Award Date Jan 1, 2013


Thesis (9.3 Mb)

Copyright Statement
© 2013 Shaalan, Ahmed Said Lotfy. All rights reserved. No part of this publication may be reproduced without the written permission of the copyright holder.

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