Exploring Relationship Marketing: Definition, Benefits, And Best Practices (2023)

Emotions, trust, loyalty. How can those elements impact customer retention over time? Stay with us to learn everything about relationship marketing and how it can contribute to your success as a business.

One of the reasons why we keep choosing certain brands, again and again, is that they’ve built a greater connection with us. They don’t just serve us with new products but aim to create trust through their value proposition and marketing campaigns.

This guide will show you how to build a relationship marketing strategy for your business to nurture long-term customers and secure a stable revenue stream. Learn its definition, assets, and ways to make a sustainable plan that will last over time!

What Is Relationship Marketing?

As relationship marketing in business, we define the conscious efforts to build long-lasting relationships with buyers and increase engagement. A successful relationship marketing strategy aims to develop emotional connections with consumers and convert them into loyal brand ambassadors.

In contrast to transactional marketing, which focuses solely on quick sales, relationship marketing treats every customer as a unique entity, aiming at understanding their individual needs.

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (1)

Source

Top Benefits Of Relationship Marketing For Your Business

But why should a business keep attracting long-term customers in more human-centric ways? Have a look at the top relationship marketing gains for your business:

Higher Customer Retention

According to research, customer acquisition costs five times more compared to retention. And this makes sense; it’s much easier to approach people who are way down the sales funnel and have already shown trust in your brand than attracting a new customer base. Thus, a high customer retention rate becomes the golden ticket to sustainable revenue growth.

Word-of-Mouth Marketing

Your customers can become your biggest cheerleaders and happily spread the word about your brand if you take good care of them. So, apart from offering great products and services, invest in personalized marketing to seal the deal and boost customer loyalty. Then, they will be ready to tell their friends and family everything about you.

Product/Services Aligned With Customer Needs

Building effective relationships with your loyal customers can work miracles for your product and services, too. The closer you are to them, the better you can determine the needs of your so-called buyer personas to upgrade your product accordingly. You can also improve your customer service based on the input you receive from your customers.

Most Common Relationship Marketing Types

OK, we got it; relationship marketing’s a big deal. But what are the most popular and effective channels to practice it? Let’s see:

Email Marketing

Email marketing is one of the most potent weapons marketers have to nurture their relationships with consumers. By creating segmented lists based on demographics, preferences, or other criteria, you can build personalized emails for your existing and future customers.

Here are the most common email types that can make your relationship with customers warmer:

(Video) I said JAI HIND in PAKISTAN 🤣

  • Welcome emails
  • Coupons/ Discounts
  • Birthday emails
  • Re-engagement emails
  • Newsletters

Look at this excellent example of a personalized email by Paravel:

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (2)

Source

Want to make a lovely email campaign for your customers? Here’s how to do it:

  • Write a compelling subject line that drives click-throughs.
  • Choose attractive design elements.
  • Write copy in a friendly and empathetic tone.
  • Create a clear CTA that ensures their action.

With Moosend, you can craft those campaigns in a flash. Use our drag-n-drop editor and ready-made templates, and track their progress with our reporting features!

Try it for free

Content Marketing

Through content marketing, businesses aim to deliver relevant and valuable resources to consumers for every step of their unique customer journey. Here are the most famous content types that are perfect for your buyers:

  • Blog posts
  • Webinars
  • Videos
  • Case studies
  • Infographics
  • Podcasts

To create great content for your target audience, you need to know them from the inside out. Analyze your customers’ most significant challenges and pain points to address them efficiently. This way, they will feel that they matter to you, as you aim to provide them with holistic solutions.

For instance, Press is an eCommerce store with plant-based products that has created a fantastic blog with health tips for its current and potential customers!

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (3)

Social Media Marketing

Of course, social media marketing couldn’t stay out of the relationship-building game! You can benefit from your social media profiles in various ways, based on your business type and the platforms you’ve chosen to showcase your brand.

So post your latest product/service updates and content and see how your followers interact with it. You can also utilize a social media listening tool, like Brand24, to understand your audience’s preferences and needs and track engagement metrics such as shares or retweets.

If you operate in B2B field, LinkedIn and Twitter are excellent choices to stay in touch with your customers. You can also use your Twitter account for customer service or support and reply to comments in real-time.

As for B2C, TikTok and Instagram are very popular among brands and followers. Here is an example by Warby Parker, celebrating moms on Mother’s Day:

(Video) What Happens To Your Body After You Die? | Human Biology | The Dr Binocs Show | Peekaboo Kidz

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (4)

You can also partner with influencers with a similar target audience to yours to boost authority and trust. Keep in mind that social media can turn into an excellent word-of-mouth marketing boost through user-generated content.

Relationship Marketing Strategy: Set Up For Success

Now that you have a better idea of what relationship marketing is, let’s find out how to build a relationship marketing plan for the first time:

Encourage a Customer-centric Culture

First off, if you want to put relationship marketing at the heart of your business strategy, create a customer-centric culture across departments. Everyone in the business should build, manage, or promote your product/service with your ideal customer in mind.

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (5)

Source

To ensure everyone is on the same page, you can create and distribute customer journey maps or organize training sessions to discuss your buyer personas’ needs and how to meet them successfully.

This mindset is even more vital for customer-facing roles, such as sales specialists, account managers, or support agents. They should actively respond to customer questions and give them the best solutions and services based on their needs. There is no one-size-fits-all here; treat every customer uniquely, and they will genuinely appreciate it.

Leverage Customer Data

To keep your customers happy and fulfilled, it’s best to manage all your contacts in one place. A Customer Relationship Management (CRM) system like Salesforce will help you track all data points that matter and follow up with your customers when needed.

Using other reporting tools such as Google Analytics will enable you to monitor different marketing activities and content efforts. For example, view your most visited content to understand your buyer’s preferences and needs.

Finally, you can also build dedicated customer surveys to receive direct feedback from buyers about your services and show them that their input is a priority for your business.

Build Personalized Experiences

The power of personalization is well-known among marketers. Look at these US stats: 63% of participants observed higher conversion rates due to personalization, and 31% stated increased e-commerce revenue as an outcome. Need more evidence?

As mentioned earlier, you can try list segmentation to deliver different emails or content to customers based on their preferences and previous activity. You can also include the recipient’s name on the subject line or email copy to make your messages more special for them.

And if you want to go the extra mile and deliver highly personalized digital experiences to customers and visitors, choose a Digital Experience Platform (DXP) like Sitecore and satisfy them to the max!

(Video) Hamilton Morris and Dr. Mark Plotkin — Exploring the History of Psychoactive Substances and More

Create Referral and Loyalty Programs

If you want to show your beloved customers that their brand loyalty is meaningful to you, introduce rewards programs to reinforce their preference for your business.

Let’s start with referrals; they can boost word-of-mouth marketing by offering incentives to customers who promote your brand to their loved ones. For instance, you can submit a discount for every referral a customer sends you and an incentive for new referred customers. Make them as intriguing as possible to reap the benefits of this initiative.

Here is an email informing shoppers about a referral program by MeUndies, with a clear subject line and a CTA you cannot leave unclicked:

Subject line: Spread the love (And Get Paid)

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (6)

Loyalty programs are also great for repeat customers, as they give them a solid motive for revisiting your eCommerce or brick-and-mortar shop. For instance, you can create a credit system so that frequent shoppers can earn discounts or presents based on their points.

Introduce an Omnichannel Marketing Approach

In omnichannel marketing, business owners use digital and traditional marketing channels to reach their target audience. But how can this technique benefit your relationships with customers?

That’s simply because you can find them exactly where they are. If your customers use social media to browse for new products, you got them covered. If they rely more on emails, you’re there for them, too. Plus, creating a consistent experience across channels nurtures a feeling of connectivity at all times, bringing engagement just around the corner.

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (7)

Source

Make sure to maintain unified messaging across channels that will enable customers to recognize your brand in a flash when they come across it for maximal results.

Build a Valued-Based Brand

Finally, strong emotions are triggered by meaningful things. That’s why 71% of consumers select brands that support the same values as them. So building a brand voice that expresses your company values is significant for your business.

To find the best statements, you can analyze your buyer personas and empathize with them. Then, once you spot your common values, make sure to sprinkle them throughout your website and communications with customers.

See Nike’s slogan “Just do it!” as a reference. It’s the perfect motivator for people who love fitness, promoting an active mindset and lifestyle most buyers can identify with. Plus, this simple but powerful statement is hard to forget!

(Video) The benefits of AI in drug development

Track your Success

Building a relationship marketing strategy has no meaning if you don’t evaluate and revisit it down the road. Here are some key customer retention metrics you can measure to ensure you are on the right track:

If any of the metrics start to decline, it’s time for reflection. On the other hand, if you figure out that your product and services remain top of the market based on customer feedback, try forming stronger relationships with shoppers using the methods we’ve discussed.

Real-life Relationship Marketing Examples To Inspire You

Here are three examples by well-known brands that have nailed their relationship marketing tactics:

1. Starbucks

When thinking about effective relationship building, the first example that comes to mind is Starbucks, a brand that puts the customer at the center of attention. All stores offer cozy space for clients to enjoy their coffee and beverages, giving room for other recreational activities, too.

Personalization starts with the customer’s name on the coffee cup, which is the brand’s trademark. Last but not least, it’s a brand that strives for social impact. They are leaders in sustainability that try to promote ethical sourcing and empower communities. These initiatives are significant for customers who back up businesses with greater goals.

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (8)

Source

2. Coca-Cola

A great example of how impactful emotions can be for customers is Coca-Cola. Nobody can forget their moving ads that talk straight to the heart. Have a look at this campaign that celebrates the New Normal and gives customers a pat on the back for what is yet to come:

In the same spirit, Coca-Cola also launched the “Share a Coke” campaign, which encouraged consumers to share their favorite drink with someone they loved. Labels had popular names to choose from and give to your family and friends!

3. Apple

And now, let’s move to Apple, which has built a brand with a great customer experience in mind. Everyone who enters an Apple Store can confirm this. The goal is not just to give customers high-tech products but a memorable experience.

Exploring Relationship Marketing: Definition, Benefits, And Best Practices (9)

Source

Apple’s relationship marketing success relies heavily on its CRM system. Apple’s team knows their target audience so well that they manage to address all their possible needs and create new products tailored to them. There is no doubt why they have been leaders in the tech scene for so long.

(Video) The best "Elevator Pitch" of the World?

Ready To Build Your Relationship Marketing Strategy?

Now that you know what relationship marketing is, get ready to find the right tools to build solid connections with your customers. Remember, your brand will flourish not only by providing them with excellent products/services but by creating meaningful experiences that bring value to them.

So create a free Moosend account today, and send your customers email campaigns that will put a smile on their faces! Good luck!

FAQs

What is relationship marketing and its benefits? ›

Relationship marketing is a distinct strategy for creating more meaningful customer relationships with the goal of ensuring satisfaction with your business and what you offer, and creating brand loyalty, retention, and a boost in customer lifetime value.

What is the best definition of relationship marketing? ›

Relationship Marketing is a strategy of Customer Relationship Management (CRM) that emphasizes customer retention, satisfaction, and lifetime customer value. Its purpose is to market to current customers versus new customer acquisition through sales and advertising.

What are the 3 benefits of relationship marketing? ›

Here's a quick look at some of the benefits of customer relationship marketing: It can enhance your customer experience. You can open two-way communication for valuable customer feedback. It becomes easier to generate more referrals to qualified leads.

What are the practices of relationship marketing? ›

Best Practices for Relationship Marketing
  • Focus on the needs of your customers.
  • Listen to your customers' feedback.
  • Be available on your customers' terms.
  • Be authentic and informative with your content and message.
  • Add a personal touch to your customer experience (i.e., personalized offers)
23 May 2022

What are the advantages and disadvantages of relationship marketing? ›

The primary advantage of relationship marketing is that it forces a brand and business to focus on long-term goals instead of short-term success. You are doing more than just getting someone to buy something. You're looking at ways to have that customer continue buying things because they see value in the brand.

What are the factors for successful relationship marketing? ›

3 critical components of successful relationship marketing
  • 1 – People Strategy. Make sure you have a clear relationship marketing strategy that reflects and supports your business strategy, and the right marketing team to deliver it. ...
  • 2 – Know Your Customer. ...
  • 3 – Communicate.

What is relationship marketing by Philip Kotler? ›

According to Philip Kotler and Gary Armstrong, "Relationship marketing is the process of creating, maintaining and enhancing strong, valued-laden relationship with customers and stakeholders." For the last some years, the companies have realized the importance of relationship marketing and are practicing it.

What are the benefits of customer relationship management strategy? ›

While the benefits vary by department or industry, six benefits of CRM platforms that affect every user include:
  • Trustworthy reporting.
  • Dashboards that visually showcase data.
  • Improved messaging with automation.
  • Proactive service.
  • Efficiency enhanced by automation.
  • Simplified collaboration.

Which of the following is the purpose of relationship marketing? ›

Relationship marketing was developed to foster consumer loyalty. Unlike customer acquisition that focuses on short-term goals and individual sales, relationship marketing is aimed at enhancing customer lifetime value and providing information directly suited to their needs and interests.

What are some specific elements of relationship marketing? ›

Basic Components of Relationship Marketing

Every relationship marketing needs to include these three basic components: customer service, customer feedback, and customer loyalty programs.

What are the 4 basic elements of relationship marketing? ›

The 4 components of customer relationship management are satisfaction, loyalty, profitability, and customer retention. Read on to learn more.

What is an example of relationship marketing? ›

Relationship marketing refers to the various strategies and processes of building long-term relationships with customers. Examples of relationship marketing include providing related goods, sending out customer satisfaction surveys, and providing services related to the product.

What are the three types of relationship marketing? ›

Here are 3 levels of relationship marketing examples, based on where the customer is in their journey:
  • Level 1: Customizing to the customer. ...
  • Level 2: Rewarding customer loyalty. ...
  • Level 3: Connecting with high value customers on a personal level.

Why are relationships important in business? ›

Forming a relationship with your clients builds trust and can help grow your referral business and retain clients for future transactions. By doing this you're forging long-term business relationships that can lead to brand advocates and successful outcomes.

What are the 5 most important things in a relationship between? ›

5 essentials for a healthy relationship
  • 1: Open communication. One hallmark of a healthy relationship is the ability to communicate openly. ...
  • 2: Listening and feeling heard. Having someone listen to us and feeling heard is important. ...
  • 3: Working through disagreements. ...
  • 4: Mutual intimacy. ...
  • 5: Trust.

What are the six basic characteristics of professional relationship? ›

A good work relationship requires trust, respect, self-awareness, inclusion, and open communication. Let's explore each of these characteristics.

What is the nature of relationship marketing? ›

Relationship marketing is about the more general concept of “loyalty”, not to be confused with the simple gain of loyal customers: in its relational nature, relationship marketing is a business strategy that must allow a brand to increase the value of its relationship with people and customers.

What is the most basic level of customer relationship marketing? ›

The most basic level of customer relationship marketing is to deal with customers directly, or we can say do direct sales.

What are the relationship marketing challenges? ›

The challenges of relationship marketing are no quick profits, higher costs per individual customer, and the expectations of returning customers.

Why is it important to have a good relationship with customers? ›

Building a working relationship with customers is key to the long-term success of a business. Having a strong connection based on trust and communication helps customers feel more secure and connected with a brand, and it can also lead to growing customer retention and your repeat purchase rate.

What are four advantages of having good business relationships with customers? ›

Building customer relationships is important because they increase sales, reduce customer attrition, deliver invaluable marketing, boost employee morale and turn customers into your R&D department.

How does relationship marketing impact today's businesses? ›

It helps you gain a competitive edge

This prompts the consumer to trust the business and promotes the consumer's loyalty, and can help businesses gain an edge over their competition. It can also help a business better its reputation by promoting word-of-mouth from its consumers.

Who introduced relationship marketing? ›

The technique was first proposed by American marketing scholars Berry (1983) and Jackson (1985). Berry (1983) argued in a conference about the field of service marketing that relationship marketing is a marketing activity for enterprises to obtain, maintain and promote effective relationships with customers.

How do you build relationship marketing? ›

4 relationship marketing strategies
  1. Strategy 1: Train and promote effective sales support. ...
  2. Strategy 2: Keep your lines of communication open. ...
  3. Strategy 3: Invest in the right ERP and CRM technology. ...
  4. Strategy 4: Boost your loyalty and customer referral programs. ...
  5. Attain and retain with relationship marketing.

Who created relationship marketing? ›

Relationship Marketing was first mentioned in the 1980s by the American marketing professor Leonard L. Berry and the American marketing guru Barbara Bund Jackson. According to Berry, Relationship Marketing is a marketing activity that generates, retains, and promotes effective customer relationships for companies.

What are the advantages and disadvantages of relationship marketing? ›

Any business strategy has benefits and challenges. Relationship marketing yields high-value free referrals but also takes time to pay off, for example. Relationship marketing focuses on overall experience with the brand rather than sales alone. Pro: Returning customers purchase more than first-time customers.

What are the benefits of personal selling in relationship marketing? ›

Advantages of Personal Selling
  • It is two-way communication. ...
  • Since it is an interactive form of selling, it helps build trust with the customer. ...
  • It also is a more persuasive form of marketing. ...
  • Finally, direct selling helps reach the audience that we cannot reach in any other form.

What benefits does relationship marketing offer to banks? ›

helping banks in reducing operating cost and attracting new customers. basis that customers vary in their needs, preferences, buying behavior and price sensitivity. Besides, relationship marketing also helps to increase market share, profitability and reduce cost. emphasis on customer retention rather than attraction.

What are the relationship marketing challenges? ›

The challenges of relationship marketing are no quick profits, higher costs per individual customer, and the expectations of returning customers.

What are the benefits of customer relationship management strategy? ›

While the benefits vary by department or industry, six benefits of CRM platforms that affect every user include:
  • Trustworthy reporting.
  • Dashboards that visually showcase data.
  • Improved messaging with automation.
  • Proactive service.
  • Efficiency enhanced by automation.
  • Simplified collaboration.

Why is it important to have a good relationship with customers? ›

Building a working relationship with customers is key to the long-term success of a business. Having a strong connection based on trust and communication helps customers feel more secure and connected with a brand, and it can also lead to growing customer retention and your repeat purchase rate.

What are functional benefits in marketing? ›

Functional benefits are based on a product attribute that provides the customer with functional utility. The goal is to select functional benefits that have the greatest impact with customers and support a strong position relative to competitors.

What are some relationship development strategies? ›

Here are seven relationship-building strategies that will help you transform your company into a valuable resource:
  • Communicate frequently. ...
  • Offer customer rewards. ...
  • Hold special events. ...
  • Build two-way communication. ...
  • Enhance your customer service. ...
  • Launch multicultural programs. ...
  • Visit the trenches.
5 Jan 2004

What is a key brand benefit? ›

Brand benefits are the value that your customers experience as a result of using your product or service. There are two types of benefits: rational and emotional. Rational (or functional) benefits: Simply put, these benefits answer the question, What does your product do?

What are some specific elements of relationship marketing? ›

Basic Components of Relationship Marketing

Every relationship marketing needs to include these three basic components: customer service, customer feedback, and customer loyalty programs.

What are the advantages and disadvantages of public relations? ›

Public relations (PR) can help raise your business' profile and improve your reputation. If done well, it can be a cost-effective way to get your message to a large audience. However, it can be tricky to guarantee success. Consider the benefits and challenges to make the most of PR in your business.

What have you learned about relationship marketing? ›

Relationship marketing is the process of developing long-term customer relationships with the goal of increasing customer loyalty and, as a result, profitability. It involves creating a process of communication with customers that is designed to build trust and create value over time.

What is relationship banking and why is it important? ›

Relationship banking is a strategy in which banks analyze their customers' needs, then cross-sell them different products and services. Relationship banking helps a bank increase customer loyalty, reduce expenses related to gathering information, and foster long-term profits.

Videos

1. First person vs. Second person vs. Third person - Rebekah Bergman
(TED-Ed)
2. Why Maslow's Hierarchy Of Needs Matters
(The School of Life)
3. Digital Marketing In 5 Minutes | What Is Digital Marketing? | Learn Digital Marketing | Simplilearn
(Simplilearn)
4. The transformative power of classical music | Benjamin Zander
(TED)
5. How 800 Million Pounds of Himalayan Salt Are Mined Each Year | Big Business | Business Insider
(Business Insider)
6. 4 reasons to learn a new language | John McWhorter
(TED)
Top Articles
Latest Posts
Article information

Author: Clemencia Bogisich Ret

Last Updated: 11/16/2022

Views: 6199

Rating: 5 / 5 (80 voted)

Reviews: 87% of readers found this page helpful

Author information

Name: Clemencia Bogisich Ret

Birthday: 2001-07-17

Address: Suite 794 53887 Geri Spring, West Cristentown, KY 54855

Phone: +5934435460663

Job: Central Hospitality Director

Hobby: Yoga, Electronics, Rafting, Lockpicking, Inline skating, Puzzles, scrapbook

Introduction: My name is Clemencia Bogisich Ret, I am a super, outstanding, graceful, friendly, vast, comfortable, agreeable person who loves writing and wants to share my knowledge and understanding with you.