Does Your Business Understand Relationship Marketing?
It’s estimated that, for the average company, less than 20 percent of their customers will return for another sale. Customer retention can be tricky, and a lot of organizations don’t do it right. So how do you keep customers around, and even get them to tell their friends about you? One of the most popular and effective methods is called relationship marketing.
What Is Relationship Marketing?
Most companies use transactional marketing techniques. The focus is on closing the sale at any cost. Get them to sign on the line, then move on to the next customer. Relationship marketing, on the other hand, focuses on maintaining the connections you make with customers over time, so that they’ll continue to come to you whenever they need your product or services. These connections can include anything from a customer follow-up program to a call to the customer on their birthday.
Benefits of Customer Relationships
What are the benefits of this type of marketing? Obviously, there’s an increase in sales. By focusing on building relationships, you can triple or even quadruple your customer retention, as you become customers’ go-to for the products and services they need.
Additionally, repeat customers are easier and cheaper to maintain than new customers, since you don’t have to keep driving home who you are and why you’re the best. Having a loyal customer base can also lead to more referrals, as they recommend you to their friends and increase word of mouth marketing.
Developing relationships even makes it easier to introduce new products in your company, as the customers who know and trust you are more likely to get on board with a new venture — and then tell their friends and get them on board as well.
There’s a maxim in sales: “You don’t just sell the customer one car. You sell them five cars, over 20 years.” Even if you’re not selling cars, the sentiment rings true. Developing relationships with your customers is the best way to increase business and build a good reputation. So, what are some ways you can use relationship marketing in your business?