BENEFITS OF CREATING RELATIONSHIP MARKETING WITH CUSTOMERS (PART 1)
The essence of relationship or one-to-one marketing is building trust, satisfying customers, producing shared customer and company goals, communicating with customers, and making customers part of the team. Relationship marketing is also about providing a bundle of benefits that the customer sees as valuable In today’s Internet environment, where many products and services quickly become commodities (that is, price becomes the key differentiating factor), strong loyal, lifetime customer relationships can enable a company to break out of the commodity bracket.
Relationship marketing changes not just the company’s philosophy but the very way the company does business. Using interactive databases, companies can effectively focus on one customer at a time, with the goal of supplying as many individual needs as possible. However, one-on-one marketing is not just about collecting information from the customer. For example, merely asking customers when and how they bought a product doesn’t produce an answer to the question “How do customers want to buy a product?” It only reveals which of the available purchasing methods they chose. It doesn’t expose which purchasing method they would prefer. Relationship marketing is about carrying on a dialogue with the customer, over time, in a market niche the entrepreneur has created and defined.
Market share, per se, is no longer a major goal, because, in a market niche, there is the potential to serve 100 per cent of the market. The major concern is not getting a share of the larger market but, rather, attracting all the potential customers in that defined niche and making them loyal customers. Retaining loyal customers and selling more to them is more cost-effective than constantly striving for more and more customers in a much larger market. Once a new company has established itself in the niche, it is in a better position` to expand to new customer segments.
There is an added benefit to building relationships with customers. If a problem occurs, a customer who has a relationship with the company won’t automatically shift their loyalty to a competitor. Often their loyalty is actually strengthened when a problem-solving session with the company results in a satisfying conclusion. All too often, however, customers have had negative experiences with companies, where the problem has not been resolved satisfactorily. In those situations, the customer never forgets.
Today, customers have a multitude of platforms from which to publicize their grievances, and one problem aired on national television can cause a public relations nightmare from which the company may never recover. Perhaps the most important benefit of establishing lifelong relationships is that over time, the full value of customers is revealed. Customers no longer are viewed as a series of transactions but as bona fide, contributing members of the team who bring value to the bottom line. The more the company learns from its customers, the better the company becomes, and the more difficult it will be for a competitor to attract these customers.