Who’s more valuable: a long-established customer, or a brand-new prospect who hasn’t yet converted? Any experienced businessperson will tell you that the long-established customer has more value than someone who hasn’t yet committed to your brand. Research confirms this — one study from Bain & Company consultants showed that effective customer retention can increase revenue by up to 95 percent.
But when it comes to marketing, there’s a lot of focus on outreach and conversion, particularly for new customers. If you don’t have a strategy for customer retention, it’s time to embrace the concept of relationship marketing.
What Does Relationship Marketing Do?
The goal of relationship marketing is to strengthen relationships with existing customers. It’s also to build their loyalty and show them they’ve made the right choice in associating with a brand.
There are several routes you can take to achieve this goal. Some are simple: good customer service goes a long way in fostering a positive relationship with someone who’s already made a purchase with your company. Others are more involved, such as a customer loyalty program that rewards shoppers redeemable points based on how much they spend at a particular store.
Chances are that you’re already doing some relationship marketing. Most email marketing is a form of relationship marketing. These messages go out primarily to people who’ve already made a purchase or booked an appointment with a business. Social media activities can also be seen as a form of relationship marketing because the people who follow a brand are likely already fans.
But simply using these channels isn’t necessarily enough to entice your existing customers to return and to build a strong relationship. There’s a strategy to effective relationship marketing. Primarily, that strategy should focus on authenticity and a genuine connection. That’s especially true if the “convince” part of the marketing process is already mostly done when you’re dealing with loyal customers.
That genuine connection goes both ways. It isn’t just about the customer showing gratitude for the brand by making repeat purchases. It’s about the brand showing gratitude for the customer by treating them with respect and demonstrating their importance.
Let’s take a look at the different ways brands have excelled at relationship marketing.
User-Generated Inclusion: Fashion Nova
Fashion Nova is a fast fashion brand with a strong social media presence. The store’s Instagram feed is a particularly good demonstration of a focused brand voice and aesthetic in action. While Fashion Nova’s clothes and aesthetic certainly aren’t for everyone, the company does a great job of cornering the market it’s in.
Fashion Nova manages that in part by including a lot of user-generated product photos in its feed. Fashion Nova’s followers can use specific hashtags on photos of themselves in the brand’s clothing. The best of those photos are then reposted to the store’s main feed, giving the customers exposure to more than 15 million followers.
That repost signals clear approval from the brand in a flattering but simple and informal acknowledgment. It also helps build a sense of community around the brand and encourages other users to participate. This is a smart way of building customer relationships. It kills multiple birds with one stone and shows customers that a brand they like also likes them.
Social Media Customer Service: Delta Airlines
How often have you or the people you follow complained about a bad brand experience on Twitter? Every day, people make their complaints public on Twitter, often tagging the brand that’s the subject of their ire. The worst thing a brand can do is let those kinds of complaints fall on deaf ears.
Delta Airlines is one brand that saw these Twitter complaints and recognized an opportunity to delight its customers. Responses aren’t canned, either. It’s clear that someone actually reads the tweets, as each response — even those that don’t offer an immediate solution — addresses the subject of the complaint. Even mundane complaints, such as a flight being delayed by weather, gets a personal response.
In addition to these thorough responses, Delta employees sign each tweet with their initials. This is undoubtedly helpful internally, but it also shows that the company’s Twitter team has plenty of members. A customer who feels frustrated and vents to social media is likely to get a swift, effective response.
With that kind of assistance, why would anyone consider flying with a different airline? That’s especially true when you consider that Delta has multiple different types of customer loyalty programs. These include frequent flyer memberships, distance rewards and a credit card that awards airline miles and other perks. Customers who stay loyal to Delta get rewarded in multiple ways.
Those who are new to the brand and have any sort of problems are likely to get converted into loyal customers. They’ll experience quick, painless customer service that reaches out instead of putting them on hold.
Fostering Strong Relationships
There’s no one right way to do relationship marketing. Your brand may not be big enough to offer loyalty rewards, but you can probably engage with your followers on social media. As long as you stay accessible and demonstrate your value to existing customers, you’ll be doing relationship marketing right.
