The Ultimate Guide to Relationship Marketing

Did you know that customer retention has been found to be even more critical to your company's success than customer acquisition? Frederick Reichheld of Bain & Company found as little as a five percent increase in customer retention can result in an increase in company revenue by 25-95%.

In fact, no matter if you’re a team of one or leading a scaling enterprise, you can build customer relationships with your existing audience without the typical costs associated with acquiring new customers. The key is strategic relationship marketing.

What is relationship marketing?

Relationship marketing refers to the marketing strategy of cultivating more meaningful relationships with customers to ensure long-term satisfaction and brand loyalty. Relationship marketing isn't about short-term wins or sales transactions — instead, it focuses on delighting customers for the long haul.

Especially since, returning customers spend more than newer customers. Why? Because existing customers understand the value of your products and services and they're invested loyally in your brand. If a customer feels satisfied with their interaction with you, they’re more likely to turn to your business for their needs, again and again.

Some marketing strategies are solely about gaining traffic and conversions to get potential customers into the customer flywheel. From there, you’ll have even more marketing tactics that get that potential customer to make their first purchase like customer acquisition.

The perfect time to start a relationship marketing strategy is when the customer has made a purchase (or several). Your goal with relationship marketing is to get these new customers to become brand-loyal patrons of your business. To do that, you’ll want to take a personalized approach to client retention and become integrated into their lives in a way that feels natural and genuine.

The benefits of relationship marketing

Like many forms of white-hat marketing tactics, there are various benefits to leveraging relationship marketing strategies for your brand. But, when properly executed, the most impactful ways to improve your business through relational advertising include:

- Strengthening your customer loyalty and increasing your customer retention rates
- Generating greater brand awareness and equity through customer referrals
- Scaling up cross-selling and upselling opportunities to an audience who already values you

Next, let’s explore how you can create a strong relationship marketing strategy for your own business.

Relationship Marketing Strategy

1. Provide personalized, focused customer service.

When you're creating a relationship marketing strategy and engaging with your customers, your primary concern should never be focused on your product or service. Instead, your concerns should always revolve around the customer — So ask yourself:

- Would the customer want to see this ad?
- Would the customer be excited about this Instagram post?
- Does our new product delight the customer?

Additionally, you must create channels for direct support when your customers need help. Perhaps your retention strategies include implementing a Facebook Messaging Bot for service-related concerns.

Alternatively, maybe you answer your customer's questions via Instagram DM. By meeting your customers on platforms they use most, you're proving your willingness to help them wherever that takes you, a tenet of successful customer retention.

2. Engage with the customer where they are.

The reason Marriott's strategy works is not only because of the content they create — it's also where they post that content. Creating videos specifically for Snapchat is a great marketing strategy example because it enables Marriott to appeal to a younger demographic on a platform already popular with that audience.

Research which platforms are most popular for your ideal demographic. By reaching out to them through their preferred channels, you're demonstrating strategy examples that embody helpfulness and understanding. It’s this sentiment that will encourage users to interact with your brand.

3. Incorporate technology to work more effectively.

Technology might seem counterintuitive to building organic relationships that are personalized, but it can be the key to solving customer pain points. As your company grows, it’ll become increasingly more difficult to connect one-on-one with each customer and continue keeping customers satisfied.

Using an automated marketing system can ensure that every customer receives communication from your business and has the opportunity to engage. Tools like HubSpot’s Marketing Hub can automate workflows and email cadences so that you never miss a customer milestone.

4. Offer incentives and rewards for customer loyalty.

To cultivate a long-term relationship with your customers and create lasting brand loyalty, continue engaging with customers even after they've purchased a product. Consider what you can offer them once they've become customers — perhaps they can get a discount on additional products, or receive personalized recommendations based on their preferences.

By creating a loyalty rewards program, Panera’s customer relationship marketing continues to incentivize its customers to purchase additional products and slowly forms a more meaningful relationship by gathering information about each customer. They then use that information to offer unique suggestions depending on their individual food preferences.

5. Create valuable content that tells a compelling story.

If a customer has already purchased your product, they don't need to see additional product advertisements to become brand loyalists — instead, they need to feel your business offers value regardless of their purchase intent.

Firms that adopt a relationship marketing strategy attempt to continuously provide quality to their customers. Therefore, down the road, when that viewer is ready to book a hotel for an upcoming trip, they'll remember the compelling film they saw once and think of Marriott.

6. Collect feedback regularly.

A relationship works two ways — to truly develop a meaningful connection with your customers, then, you must ask for feedback:

- What do they want to see from your brand?
- What do they like about your product?
- What do they wish you wrote about on your blog?

This information improves your relationship marketing strategy so you best fit the needs of your specific audience.

7. Concentrate on building customer relationships for the long-term.

There will always be a time for marketing strategies like Pay Per Click ads that generate the instant sales gratification of proper product promotion– but this moment isn’t one of them.

In order to foster meaningful relationships that cause your customers to truly connect with your brand, you have to create purposeful content and deliver quality service to guide them throughout the relationship.

By doing so, you will establish brand trust, show your audience you're not just in it for a quick buck, and demonstrate your commitment to their success, not just your own.

Play the Long Game With Relationship Marketing

There’s a time and place for quicker marketing strategies wins and they’re paramount in hitting goals and KPIs each quarter. However, your marketing, sales, and service teams work much better together at playing the long game.

Relationship marketing won’t score you consistent quick wins that you can measure with hard numbers on a dashboard. But you’ll find that staying the course and nurturing the customer through relational advertising will yield happier and more loyal brand advocates for quarters to come.