Strategic Customer Relationship Marketing

In the past, a customer was defined by a transaction, simply put, they were what they bought.  Once they handed over their money in exchange for a good or service, our relationship as a company with that customer ended.   This type of marketing is known as transactional marketing, where the business focuses on maximizing its sales efficiency through increasing the volume of individual sales. 

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In the modern world, global competition has become much more intense and as a result of this increased competition, customers have gained significant buying power. Therefore, businesses have been forced to look for more sustainable sources of competitive advantage, better separating themselves from their competitors.  This has led to the introduction of relationship marketing. Relationship Marketing involves developing a deeper ongoing relationship with your customers post-transaction, where the business focuses on their customers’ loyalty.

There are various practices of relationship marketing that companies use in today’s society:   

• Loyalty Programs – Rewarding their consumers with points for every transaction that can be accumulated into cash value towards a purchase. i.e. Shoppers’ Optimal Points
•  Email Marketing – Sending out frequent emails notifying customers of promotions or store-offerings. i.e.  American Eagle’s All Access Membership
• Social Media Marketing – With the explosion of social media, it has made it easier for businesses to create a 2-way communication channel between its customers; i.e. blogs, Facebook, Twitter, mobile apps
• Information Technology/Databases – Although expensive and difficult to implement, companies can implement technology systems that track employees’ purchases; used to gain a better understanding of which operational components add value and which do not, making your company more efficient.

The objective of relationship marketing is to gain loyalty and trust from your current customers, the following video demonstrates the four behaviours of building brand loyalty.

There are various benefits associated with relationship marketing initiatives, both economical and reputational.  Companies can realize higher profit margins with long-term customers, in fact, according to surveys, the top 16% of the company’s customers account for 105% of its profits with the bottom 28% eroding profits by 22%[1].  Furthermore, these loyal customers provide stable cash flows and generate word-of-mouth referrals to other prospective customers.  For a more detailed explanation of the advantages that can come from implementing relationship marketing click here, this website provides statistical proof.

Hope this blog has provided you with a better understanding of Strategic Customer Relationship Marketing! 

Thanks for reading J

 Darcy Davis

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[1] www.google.ca/url?sa=t&rct=j&q=&esrc=s&source=web&cd=3&ved=0CDMQFjAC&url=http://www.kmworld.com/Articles/ReadArticle.aspx?ArticleID=9240&ei=StOVUOmeBOru2QXO_4DABA&usg=AFQjCNFWqknEM8ZDFqDNtPfm2dkL3aVIZg&sig2=YK3tj5_6C-C3Ir9_VzY6Gg

Branding on the Web

We as marketers know, (if you don’t, you should) that branding is a critical component in achieving success. We’re using the traditional approach of listening and providing the customer with a solution for his needs, but are constantly evolving and focusing a lot more on branding.

Branding is much more than just adding a recognizable logo, having a catchy slogan or standing out from the competition. Nowadays, this phenomenon is about creating a long-lasting relationship with someone who knows little or nothing about you, and transforming them into a loyal customer who trusts and loves your company.
 

The strength of a brand -also known as brand equity - will affect this. And because the internet is such an important part of our everyday lives, branding on the web is much more important. Our mission has become a lot easier due to the fact that the internet allows customers to have an increased level of brand awareness and makes them quicker to act than traditional mass-media. This doesn’t mean that the same marketing principles don’t apply anymore. On the contrary; a customer passes through the same stages – awareness, familiarity, trust, commitment- but a lot faster because of the internets advantage of being highly interactive, engaging and able to personalize communication. 

Creating an online brand

The resources and efforts required for a good branding campaign are quite high. That’s why there are guidelines that should be followed for a better end-result. The most important ones are:

• Emphasize the quality and mission of the company.  You will want to implement an image or reputation that stands out and is respected.

• Research your customer and engage him through the use of signage, advertising and online personality.

• Find the right balance between advertising-marketing and customer relationships.

•  Continuously manage and control available information about your products or company.

It is becoming clear that people are making choices and develop attitudes towards certain brands based on the material they find online. This issue can be handled in several ways. The first would be to create and spread your own relevant content, or by letting the users come up with the information - reviews, discussions or blog posts - and handle that content accordingly with the use of marketing tools such as search engine optimization.

As a conclusion, it is fair to say that branding is a highly complex process if it’s done right, but it is vital for any type of business because the targeted consumers are always changing and develop new needs that need to be addressed.