Relationship Marketing: The key to Retaining Customers for Life
Marketing is more focused on digital than ever before. Modern marketers and sales professionals are in a long race of acquiring new customers and increasing brand awareness across newer geographies and scopes of business. While marketing and sales work as a team in growing the business with acquisition efforts, it is imperative to dedicate the same amount of efforts and resources in retaining the existing users.
In today’s customer-first era, relationship marketing is a perceived altruism that entails mutual trust between a business and its customers. With more businesses putting the customers at the center of their marketing strategies, relationship marketing retains its prominence among various organizations that aim to foster loyalty and pursue brand ambassadors.
According to Forbes, a business is as good as the clients it serves, and no business gets too far after losing the clients it has.
What is Relationship Marketing?
Relationship marketing is a way which leverages customer trust to improve customer retention and drive hyper growth based on one-time acquisition. Having emerged at the forefront of modern-day marketing, relationship marketing is more focused on customers as opposed to traditional marketing which heavily focuses on prospects and new leads.
Initially, product marketers and growth marketers were responsible for driving relationship marketing, but now organizations have a designated person for customer marketing. They are responsible for strategizing the relationship marketing strategy which focuses on creating long-term and valuable relationships with the existing customer.
Why is Relationship Marketing Important?
Imagine if your business stopped getting repeat customers. Or, if your customers stayed but never referred you to their friends and peers?
Well, this indicates that you might have to go on a scavenger hunt to acquire new customers for your business to sustain itself in the long run.
According to a Forbes Article, a 5% increase in customer retention can increase your company’s profitability by a staggering 75%. Also according to a survey, it would cost just 11% of what it would cost to acquire a new customer.
Every business wants their customers to “trust” them. Modern businesses are based on mutual relationships with their customers. According to a research, even with the best products and business practices, you will still need strong customer relationships to succeed in an increasingly competitive marketplace.
Hence, retention marketing lies at the core of relationship marketing and plays an integral role in your business’s growth.
Here are 6 reasons why relationship marketing is critical to your digital business:
1. Build formidable trust:
Relationship marketing builds upon improving the customer experience and puts customer trust at the center of your marketing efforts in order to foster higher customer loyalty. To build this trust with your customers you must first start thinking like a customer and study your own viewing, browsing, and purchase habits, depending upon what industry you operate in.
Assuring the customer your support whenever they need you and by whatever medium possible helps create a sustainable trust factor.
2. Solve mutual problems:
Relationship marketing helps in solving the mutual problems of both the business and the customer. Your customers are the reason your business able to leverage monetization opportunities, hitting top-line growth. So actively listen to their concerns, what they like, and what they want to be changed, any specific pain point that has to be addressed and solved.
If more customers are insisting on one thing, perhaps it’s time to pivot. These insights help in iteratively improving your product.
3. Build a better product:
Did you know that 70% of companies that are considered best in class for customer experience rely on customer feedback? Repeat customers to your business bestow more than just revenue growth.
As your customers continue to do business with your company, they become more closely acquainted with the products and services you offer. This helps your company to get knowledgeable feedback from a customer’s perspective. Converting this valuable and timely feedback into actionable insights help in building a better product over a period of time.
4. Deliver a seamless customer experience:
Customers don’t just want to buy a good product. In fact, they want to experience the joy of purchasing and using a good product.
Relationship marketing helps you focus on the customer, rather than on the product or service you offer. It also helps in creating an in-depth profile of customers based on their needs and by understanding what exactly they’re looking for. By adopting a more customer-centric approach and focusing on customer relationships, you can align your core strategies and work across teams to meet customer needs, improve satisfaction, and deliver a seamless experience consistently.
5. Strengthens customer advocacy:
In today’s day and age of unreliable paid reviews, your prospects are more likely to believe what they hear directly from the horse’s mouth; i.e. your existing customers!
Let’s face it — not all customers are likely to become super-fans of your business. For a customer-centric business, they become your core pillars of growth. It is not easy to build customer advocacy and relationship marketing makes it easier for you. Once a customer starts advocating for you, they’ll become the most profitable source of customer acquisition. They are not just repeated buyers but gradually become the lifeblood of your business.
6.Lowers Customer Acquisition Costs (CAC):
One of the highest revenue churners is that of a customer’s acquisition. When you leverage relationship marketing and build some viable trust, and engage effectively via nurturing with a multi-channel approach, you can attempt at lowering your customer acquisition costs, since you only spend once on a particular customer.
Relationship Marketing Strategies to Strengthen Your Customer Relationships
1. Create compelling story-driven campaigns:
Modern day customers are far more informed and aware about your product and your ads. They are less willing to trust traditional advertising methods. Today, you need to rely on storytelling to focus more on getting customers emotionally invested in your product and service and less on telling customers what to do.
In fact, 92% of customers say they want brands to focus on creating story-driven advertisements.
By engaging customers through compelling narratives that align closely with your company’s goals and vision, you can make sure that your customers are taking personal relationships into consideration when making purchasing decisions.
Get your customers hooked to a memorable storyline that resonates with them internally, and you increase your chances of converting them into repeat customers.
2. Formulate an effective loyalty programme:
Who doesn’t love rewards? Loyalty programmes can become a key component of your customer retention strategy, to begin with. However, it isn’t easy to formulate a customer loyalty programme. It varies from company to company, based on the kind of product or service you might have. But, it will amplify the customer engagement across both online and offline channels.
Also, you need to ensure that your programme actually communicates and delivers value consistently. Relationship marketing has to be built on the foundations of mutual trust.
3. Engage more effectively with your customers:
Connecting with a customer at a deeper level helps you build trust and long-term loyalty for your business. While social media and email marketing have been the important ways to engage your customers, Push Notifications, In-App Notifications, and SMS also play a very crucial role in this mobile-first world.
Having a data-driven strategy for each of these engagement channels helps you better engage and drive meaningful conversations with your customers in real time.
Mind you, all of this is facilitated by first gaining a comprehensive understanding of your customers through a unified view of their demographic, geographic, and behavioral data.
4. Don’t turn your back on email marketing:
While being a traditional channel of engagement, email continues to remain important in today’s multi-channel, cross-device environment.
It is one of the channels that give you a chance to reach your customers and retain their attention to the maximum, knowing how highly distracting other channels can be.
And, by automating your email marketing efforts you don’t have to manually send emails to your customer list and waste most of your productive time.
5. Drive Regular Customer Meet-Ups:
Meet-ups foster customer intimacy and if you happen to be in the SaaS business, then customer meet-ups are crucial to understanding what a client thinks about your product or service. This gives you yet another touchpoint — this time, physical — to build on your relationship marketing strategy.
Most meet-ups are held outside the office and revolve around networking, product seminars, webinars, and round table discussions on industry-related concerns and solutions-centric themes.
These meet-ups are also a creative way to understand what expectations your customer holds from your product or service. This is also a great way to discuss the possible roadmap of your product, in order to give your customers something to look forward to.
6. Create Customer Success and Growth Stories:
Customer success stories and case studies can be used across both the marketing and sales funnels.
These help you accomplish the following:
• They help you build credibility
• Become a concrete source of how your product or service can help their business
• They help open up upsell and cross-sell opportunities in the long run
Relationship Marketing = Customer Retention
Relationship marketing strongly relies on marketing automation and CRM. “Engagement” and “Trust” are the keywords here.
You need to constantly engage with your customers across multiple channels. And, as businesses focus on increasing their customer retention rates, deeper customer insights will help you delight your customers through personalized and differentiated experiences.
And yeah this blog was originally published on Smartech Blog.
At Smartech, we are focused on helping digital businesses create sustainable relationship marketing strategies in order to help them retain their customers for life.
