Five levels of Relationship Marketing:
1. Basic
marketing: This is the first
step in marketing. It involves acquiring (receive) a customer and successfully
guiding them through a sale.
2. Reactive
marketing: The second step is
when a company can receive feedback from a customer after a sale.
3. Accountable
marketing: Similar to reactive
marketing, but taking it a step further, this occurs when a business reaches
out to a customer for suggestions to improve their experience with the business.
4. Proactive
marketing: This is where
businesses actively work to improve their products and services, to provide the
best possible experience for their customers.
5. Partnership
marketing: Partnership
marketing involves collaboration with other businesses to improve customer
experience and satisfaction.
No matter
which level you focus on, good marketing puts its customers at the center of
all campaigns and strategies. A business should start with basic marketing to
build a customer base, then work through the remaining steps to get to know
their customers and provide the best product, service, and experience possible.
This will ultimately build loyalty.
Pros
of Relationship Marketing
1. Cost-effective: Relationship marketing can be part
of any marketing campaign or communication with customers, so it’s something
businesses are already doing—but perhaps not as strategically as they could be.
It doesn’t typically require a major financial investment to build
relationships with customers, which makes it a cost-effective marketing
strategy.
2. Sustainable: Relationship marketing seeks to
create long-term customers as opposed to short-term or one-off marketing
campaigns. It also creates loyal customers who may recommend your business to
friends and family, providing you with additional marketing at no cost.
3. Increase’s
customer lifetime value: Ultimately,
relationship marketing drives long-term sales, increasing your customer
lifetime value. This increases profits without the time and money investment
involved in acquiring new customers.
Cons
of Relationship Marketing
Here
are the drawbacks of relationship marketing:
1. Requires
a customer base: Much
of relationship marketing is limited to those who have an existing customer
base. While every business will benefit from taking a customer-centric approach
to marketing, relationship marketing seeks to generate repeat business from
existing customers, so only businesses with an established clientele can use it
fully.
2. Time
investment: The more
strategy involved in marketing—as is true for relationship marketing—the more
time it will take to build and launch. This can mean added upfront labour
costs, not to mention the time required to craft effective campaigns.
3. May be
difficult to understand customers: The
challenge in relationship marketing is that even with an existing customer
base, not all businesses truly know their customers. Those who have a hard time
connecting with customers will find it difficult to learn about their
interests, preferences, and motivations—all of which are key to relationship
marketing campaigns.
Examples of relationship marketing
Thank customers through a social media post or with a surprise gift
card. Solicit customer feedback through surveys, polls and phone calls, which
can create a positive impression that customer opinions are valued and help to
create better products and services.
1.
Lay’s: ‘Do Us a Flavour’
Lay’s,
America’s top potato chip brand, took relationship marketing to new heights
when it launched its “Do Us a Flavour” campaign, which invited the public to
get involved in the process of creating and choosing new chip flavours. It did
this by asking customers to submit their own unique flavour ideas. The top
ideas were manufactured, then Lay’s once again asked customers to choose their favourite
from the bunch.
This
is a great example of relationship marketing as Lay’s gave its customers
massive creative control of its product. This created a deep feeling of
ownership among buyers, which resulted in deep loyalty to the brand. Not only
did buyers choose Lay’s because of the flavour, but they also chose it because
of the investment the brand put in them as consumers.
2.
Amazon: Prime
Amazon Prime shows
us how a business can incite loyalty with incentives that don’t involve a
loyalty program. The ecommerce conglomerate has been very successful, in part
due to its relationship marketing strategies. For example, two-day shipping is
part of Prime benefits, but it takes this a step further by frequently giving
Prime members one-day shipping or the option to get account credit for choosing
a shipping time over two days.
By
giving members more value, they remain loyal to Amazon. The numbers demonstrate
this; Amazon Prime members spend four times as much on average than non-Prime
members, indicating how effective their relationship marketing strategy is.
3.
Dollar Shave Club: Customer Interviews
Dollar Shave
Club used relationship marketing by getting personal. It did this through
weekly interviews with its customers, which were then posted on its blog. The
interviews rarely had anything to do with the products that the company sells,
so they never felt like a sales pitch. Instead, they made people feel like they
were involved in something bigger than buying a new razor. Plus, who doesn’t
like to be in the spotlight?
This example
illustrates the value of putting customers at the heart of relationship
marketing efforts. Dollar Shave Club used these interviews to get to know their
customers and to provide entertainment for their customer base. The idea wasn’t
to talk about its products or why people should buy them. However, by providing
great, authentic content, loyalty jumped, and sales increased.
No comments:
Post a Comment