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What Is Relationship Marketing?
March 30, 2023

Relationship marketing is a marketing strategy that focuses primarily on customer retention and loyalty, with the goal of creating long-term bonds with consumers. Relationship marketing prioritizes interactions with your existing customer base to keep them engaged with your brand. Think long-term nurturing versus short-term sales. Relationship marketing means giving your customers extra love and attention to cultivate a more valuable relationship. 

Advantages of Relationship Marketing

Marketers tend to get caught up in lead generation, focusing so much on bringing in new customers that they neglect the ones they already have. This misstep can cause companies to lose brand loyalists and the vast benefits that come along with them. Typically, an organization expects around 8% of its loyal customer base to generate half its revenue. It’s those returning customers that often spend more than the new ones. Plus, when customers are happy, they spend more money more frequently. “Retaining existing customers has been shown to increase profitability by 25% to an astounding 95%,” according to Think Impact. 

What are the benefits of relationship marketing? Outside of improved ROI, companies can expect

  1. Improved customer retention and increased revenue from brand loyalists. 
  2. Acquisition of new customers through customer referrals.
  3. Less expenditure of capital and resources spent on lead generation.  

Brand Loyalists are Your Friends

Brand loyalists will tout your benefits from the rooftops. They’ll advocate for you without any investment in advertising or marketing. Retaining customers cost 1/6 or 1/7 of the cost of lead generation while contributing more to revenue. “On average, word-of-mouth drives $6 trillion in annual global spending and is responsible for 13% of all sales,according to Semrush. While helping to increase brand awareness, customer referrals are also a trusted source of information. Andyou probably guessed where this is headed92% of customers trust referrals from people they know. Affordable and effective. 

Executing a Customer Relationship Marketing Strategy 

A good customer relationship marketing strategy focuses on showing appreciation for your customers and meeting them where they are. Here are a few ways to execute a relationship marketing strategy. 

  1. Listen to your customers to learn what they want.  
  2. Focus on personalized customer care and service.
  3. Consider loyalty or rewards programs. 
  4. Show you appreciate them with gifts of gratitude.
  5. Gather feedback and continually implement improvements. 

Listen to Your Customers 

It’s easy for marketers to get swept away in the sea of marketing tactics, pushing what they think people want to hear about products or services rather than seeing things from a customer perspective. But you gain an entirely new point of view if you truly listen to what your customers have to say. Check out social media, read reviews, or even implement a direct portal for customers to share their opinions. Let them know you hear them and take their feedback seriously. 

Personalized Customer Care

Sure, you can send an email that pulls someone’s first name into the body of the text, but that’s not really what great personalized customer care is all about. This kind of service puts your customer first and foremost. You have to dedicate the necessary resources it takes to understand a customer’s problems and resolve them quickly. Utilizing a CRM to track customer interactions is also beneficial, so you have a running record of all touchpoints

Kyle and Jonathan sitting in the lobby discussing a current project.

Loyalty or Rewards Programs 

Sneak peeks into products, exclusive access, additional discounts, and member rewards are all ways you can increase your customer loyalty. Relationship marketing means creating a more meaningful relationship, which means giving your brand loyalists a reason to keep returning 

Cashback and Rewards - loyalty program stock image.

Gifts of Gratitude 

Giving your customers a little thank-you gift doesn’t have to be huge or expensive. You can send a small sampling of a new product, throw in some customer swag, or organize a large-scale program. It will be warmly received as long as it’s personalized and authentic.  

Courtney Bills handing out personalized letterman jackets for employee Christmas gifts.

Gather Feedback and Implement Improvements 

Every successful business changes with the times. Let your customers tell you what they love and don’t love about what you’re doing. Implementing change can be one of the best ways to succeed with relationship marketing because you’re holding up your end of the relationship. 

Customer review satisfaction feedback survey stock image.

Relationship Marketing Examples

It’s easy to provide conceptual guidance, but here are some actual tried-and-true examples of companies winning at relationship marketing. 

Sephora Levels Up the Loyalty Program Game 

Loyalty programs can take many forms, but the bottom line: customers love being rewarded for their business. Take Sephora Beauty Insider, for example.  This program offers its members the ability to redeem points, get free samples, and access limited edition products, with additional options for its most loyal customers, such as further discounts and free shipping. Sephora certainly knows the ins and outs of relationship marketing. 

Starbucks Focuses on Personalized Customer Care 

The coffee business has its fair share of competition, but there is one name we all know: Starbucks. Starbucks takes personalized customer care to the next level by offering free goodies through its rewards programs. They even make suggestions of drinks and food based on your purchase history and use your first name for customer interactions. Everyone likes to feel seen. 

Starbucks drinks sitting on a black round table.

Invesque Sends Gifts of Gratitude 

Finding a little surprise tucked inside your inbox or mailbox is nice. Additional discount codes or offers of free shipping are lovely gestures. You could also ditch the digital and remind customers of your appreciation with a 3DDM kit. Fill a box with some goodies and include a thoughtful thank you note. Here’s an example of a gift we helped Invesque assemble as part of their relationship marketing strategy. 

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Domino’s Makes a Case for Listening to Customers 

When all else fails, listen to what your customers say and admit your mistake. Domino’s Pizza famously launched its Pizza Turnaround campaign, where they publicly shared negative reviews and vowed to be better. While this may seem like a huge misstep, customers were intrigued and encouraged by a company willing to own up to their shortcomings.

The campaign was a hit, and they earned a few brand loyalists in the process. Everyone makes mistakes, and we can appreciate it when companies don’t sweep them under the rug 

Take out boxes on a American pizza with Dominos Pizza logo with North America map background

Salesforce Regularly Gathers Feedback and Implements Improvements  

One of the monoliths in the technology world keeps its customers returning by keeping an open ear. Salesforce implemented a customer feedback platform in the form of the IdeaExchange, a place where customers, vendors, and others can submit ideas for improvements. Community members vote for their favorites, and Salesforce implements the feedback. Customer-generated and customer-approved.  

Relationship marketing is about nurturing long-term engagement with customers who already know you and like your product or service. Take advantage of your fans and show them some love! 

2022 Post Dreamforce Kit on a white background.

Are you looking to incorporate print + promo into your relationship marketing strategy? Our team of experts is ready to help. Give us a shout!