Relationship marketing is often the difference between and success failure in business.
Sometimes called “loyalty marketing” or “retention marketing,” relationship marketing is about creating connections with customers and prospects that lead to loyalty and referrals. It is not about generating an immediate sale or transaction. Relationship marketing lowers the cost of customer acquisition, increases customer retention AND builds valuable word of mouth.
The benefits of relationship marketing are clear:
- A 5% increase in your customer retention rates can increase profits by 25% to 95%
- 80% of a your company’s future profits likely come from 20% or less of your existing customers
- It costs six to seven times more to acquire a new customer than to retain an existing one
Sources: Gartner Group, Bain & Company
Relationship Marketing Strategies that Pay Off
Here are five relationship marketing strategies to let your customers and prospects know that you value and appreciate them as individuals increasing the likelihood that they’ll remain loyal and refer others:
Make connections, not contacts.
Don’t waste time chasing random Facebook “likes” and other social media status markers. It’s better to engage with a handful of people in meaningful ways than to broadcast to an audience of thousands who aren’t listening anyway. Attending a networking event? Don’t be the person passing out business cards like they are a deck of playing cards. Rather, make a concerted effort to have deeper conversations. Ask questions and learn how you can help others achieve their business goals. When you do this, people will become interested in what you do. As Zig Ziglar said, “You can get anything you want in life if you help others get what they want.”
Prioritize relationships over self-promotions.
Build genuine connections by being helpful, i.e., give clients the information and tools that will help them succeed. In other words, don’t make it all about you. Only 20% of your time should be spent marketing and promoting your services. Use the remaining 80% to educate, entertain, encourage and support. It’s not all about the latest and greatest social media, either. Personalized cards and heartfelt gifts are highly effective relationship builders (I’ve used SendOutCards to stay in touch with clients and prospects over the past six years and it has been a very effective communications tool).
Treat every relationship carefully.
You are busy. Sometimes, it’s hard to give customers the attention they deserve. But every interaction is a chance to improve your business and to build stronger relationships with all customers (remember, social media has the power to magnify your interaction with one customer and make it visible to everyone). Treat every relationship like it matters…because it does. People move between jobs and take on different roles in their lives and in their careers. You never know who will be a decision maker in the future.
Don’t take rejection personally.
Let’s face it, rejection feels bad. But not everyone wants to have a relationship with you and that’s okay. People are stretched thin at work, stressed out at home, or otherwise preoccupied. Don’t take a “no thanks” as a sign of personal rejection. Instead, consider it as a “not right now” that may bring you one step closer to “yes.” (To learn how to move from a “no” to a “yes,” I recommend the bestselling book Go For No! by Andrea Waltz and Richard Fenton.)
Be pleasantly persistent.
Relationships take time. More often than not, you have to work for them. Yet combine persistence with pleasant professionalism and it’s hard to go wrong. Amazingly, 48% of sales people never follow up with a prospect after initiating the first point of contact yet 80% of sales are made on the fifth to the twelfth points of contact. Keep following up and you’ll not only stand out from your competition but you’ll also build the foundations of long lasting relationships that lead to loyalty, referrals and repeat sales.
All Business is Personal
Technology has made it easy to communicate with all your connections simultaneously, yet people still want to be recognized and appreciated as individuals. Relationship marketing isn’t new, and it isn’t rocket science. While it does require creativity and commitment to stay connected personally, the business benefits justify the effort and the feeling of connectedness you’ll have is priceless.