Customer Relationship Marketing – Your Only Competitive Insulation

Customer Relationship Marketing – Your Only Competitive Insulation

Products and services are, for the most part, the same. Their features and attributes are parity. Their benefits equal. So, the relationship your company, brand, product or service has with its customers is often its only competitive advantage.

Companies with strong customer relationships are usually leaders. This is well documented in many fine books and articles so we won’t defend the POV here. But, if this is true, and customer relationship marketing is an ideal strategy to be competitive, then the question becomes, “How do I do it?”

We’re not suggesting that your company becomes friends with its customers. That’s not realistic. But, when your customers feel a degree of affinity toward your company, all things being equal, they will choose you over the competition. They do this because over time you have delivered more value and this added value created relationship equity.

The value can be practical, it can be emotional, and it can be both. But if it’s delivered consistently, relationship equity is created and becomes competitive insulation. An effective customer relationship marketing strategy can make the difference between a company that performs with the market and one the out performs the market.

The following Relationship Marketing Principles are based on experience building relationship marketing programs in Europe and the US. Keep them in mind as you design your Relationship Marketing strategy.

1) Attract the right customers for the right reasons

Dr. Stephen Epley, the founder of Epley Market Research and Consulting, says that 90% of loyalty problems can be traced to the sales process. Be sure your strategy and tactics are designed to attract Heavy Category Users for the right reasons. Sell your value. Don’t coerce them with a bribe.

2) The most crucial time is the beginning

Buying your product or service does not mean they have a relationship with you. Are they open to it? Perhaps. Do you have to earn it? Absolutely. Their interest in your product is high, and they are willing to listen, but don’t be deceived, their interest in the category is also high. They are listening to what the competition is saying. Acknowledge them. Let them know, through words and deeds, that you value their business. Surprise them with value beyond your product’s functional benefits.

3) In established relationships continually reinforce the decision to buy

Once you have established a connection don’t abandon your efforts. The most important purchase isn’t the first, it’s the second. Reinforce how smart they are for buying your product. Give them every reason to buy from you again. But keep the plaid jacket at home. Talk to them like you have a relationship, not like some sales guy trying to make his numbers.

4) Good customers expect to be rewarded

This isn’t to suggest that every customer gets a prize. Understand who your best customers are, the 20% of your customers who generate 80% of your revenue, and reward them. Surprise them. Delight them. Make them customers for life. Make them so happy they tell friends and associates what a pleasure it is to do business with you. The ROI on these relatively small investments, especially compared to the cost of acquiring new customers, is huge.

5) The second most crucial time is when the relationship is at risk

Again, this isn’t for every customer, but for your best customers take the time to really understand what went wrong and then do something tangible to address their concern. Don’t take the relationship for granted. Whatever went wrong used up some relationship equity. You need to earn it back.

Source by James Hipkin

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