Posted on June 15, 2009 by Donna Price, Marketing Strategist & Business Consultant
Business is all about relationships. They are at the heart of marketing as well. Strategically using relationship marketing is about building strong, long term relationships with your current clients and companies. By having this type of focus you are increasing your business but not solely by seeking new clients or customers. Relationship marketing improves your exisiting relationships. You assess the needs of individual customers and meet those needs, in fact -over-deliver.
The components of an effective relationship marketing strategy include: marketing; special sales; customer care/appreciation; communication and special events. These approaches improve the relationship and increase its longevity. The client/customer realizes the value of the business relationship and they remain active and increase their loyalty. Relationship marketing focuses both on building a new relationship but also on retention.
Marketing research indicates that the cost of retaining an existing customer is ten percent of the cost of obtaining a new customer. This is why relationship marketing makes sense for business owners. As much as eighty five percent of profit may be attributable to customer retention according to another study. High costs are incurred when marketing to new customers and obtaining them as customers. If you are able to retain an adequate number of your current customers you decrease your need for new customers. This isn’t to say that you want to totally give up your marketing to new clients/customers.
When you gain customer trust, the chances of that customer moving to another company is significantly reduced.
Your costs are reduced in addition to your marketing dollars as the customers are already familiar with your processes. You don’t have to spend time teaching them as they have already learned. This reduces your staff time and improves their job satisfaction as well. Imagine, regular, friendly customers using your service or product over and over. Your staffs are familiar with them and they become familiar with your staff. It is in this process and exchange that good (great) customer service is provided. Customer service is a key in your relationship marketing strategy.
The goals of relationship marketing are to build long lasting relationships with your current and existing clients, increasing their commitment to you and your business. Additional benefits are achieved through your strategy and these further build the business.
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