What is relationship marketing?
Relationship marketing is different from other forms of marketing, which often focus on a single transaction. Relationship marketing, on the other hand, is not usually tied to a product or offer. This means that a company that wants to focus on relationship marketing will refine the way they do business to maximize the value of the relationship with the customer.
Relationship marketing primarily involves the company improving its internal operations. Many customers stop shopping with a company not because they didn't like the product, but simply because they were Frustrated with customer service. If a company adapts its internal activities to satisfy all customers' service needs, customers will be happier even if they experience some kind of problem with their product.
What you need to be aware of
Technology in general plays a big role in the 21st century, and so technology also plays an important role in relationship marketing. The internet has made it easier for companies to track, store, analyze and then use vast amounts of data about their customers. Customers are exposed to personalized ads, special offers and fast service as a sign of appreciation for their loyalty.
Social media also allows businesses to engage their customers in an informal and continuous way. In the past, it would have been impossible to keep track of every customer, but technology makes it easy for companies to automate their marketing efforts.
Branding is the final ingredient in relationship marketing. A company can create a long-term relationship with a customer if the customer feels that the brand reflects who they are or who they want to be. Customers are less likely to switch to another brand if they believe that switching brands can be telling about their identity. For example, customers who buy organic free-range eggs may not immediately switch to scrambled eggs. Another example is that a company might not immediately want to switch from Deloitte to a smaller and more unknown auditing firm, as it could say something about the company's identity and quality.
The importance of relationship marketing
Acquiring new customers can be challenging and expensive. Relationship marketing helps retain customers for the long term, resulting in customer loyalty instead of customers buying something once or very rarely.
Relationship marketing is important for its ability to stay in close contact with customers. By understanding how customers use a brand's products and services and observing further unmet needs, brands can create new features and offers that meet those needs, further strengthening the relationship.