Relationship marketing means creating a two-way relationship with your customers, with mutual benefits that build customer loyalty and lifetime consumption. It represents a set of measures designed to keep your customers buying from you but at the same time creating a meaningful, two-way conversation between the brand and the customer. As a leader in the anti-aging products industry, Neora is an eight years success story that perfected the techniques of relationship marketing to offer real customer experience related to the products. Neora adopted an MLM business development strategy, using Independent Business partners to get closer to the clients, to secure their trust and loyalty and offer more personalized advice coming from one to one relationships. The strategy evolved into a relationships marketing approach where the client – sales rep relationship is placed at the center of their business. The benefits of this relationship strategy for developing a business are mutual to both clients and the company. Here are the top 5 relationship marketing benefits
1. Improve customer loyalty The purpose of any marketing strategy is to create a long-term relationship between the brand and the customers. The longer the customer stays with the brand, the more valuable it becomes. Statistics show that an excellent relational marketing strategy that can bring even a 1% increase in customer retention generate a 20% increase in annual revenue. Meaningful relations with the customers increase their loyalty and deliver value and plenty of benefits for both sides. 2. Increase customer referral Companies like Neora adopted a relationships marketing strategy to develop business due to this power of word of mouth. In the FMCG field, especially in the beauty industry, recommendations from friends and family act as the most trusted source of information when making a purchase, more powerful than any form of advertising. A one to one business approach and selling through Independent Brand Partners create a strong customer relationship for Neora which further led to a boost in satisfaction and loyalty making the customers more likely to recommend the products to their acquaintances. You can encourage referrals by creating special referral programs which include discounts or extra services. 3. Real-time feedback opportunities The consumer relationship marketing is a two-way communication path. The brand message reaches the consumers' mind and thoughts, but a real-time constructive or critique feedback comes in return. Customers expect you to listen to them in response to offering their trust. A base of happy and loyal customers represents a perfect opportunity to market test new products or services. Actively listening to the customers is a perfect way to gather feedback on your strengths, weaknesses, and areas for improvement. Also, happy customers give positive reviews which help get more customers. One step further, loyal and trustworthy customers, especially the ones you have a one to one relationship with like Neora’s business model, can even support innovation by identifying gaps in the market and suggesting ideas for the business. Acting on the customers' feedback proves to them that you are a caring company, worthy of their trust. 4. Decreased reluctance to change Changes such as price increases, product ingredients or recipe are hazardous and could lead to losing valuable customers. Solid relationship strategy can help make these transitions more smoothly and more effortless to be accepted. The loyal customers, who already have a special relationship with the brand and a long-term consumption habit are less likely to leave at the first sign of change. Also, loyal customers are less reluctant to try new products since a trust bridge have already been established. 5. Improved marketing efficiencyOne of the primary marketing rules says that it is three times cheaper to retain an existing customer than recruit a new one. It is easier to respond to their needs and to communicate the brand message since you already know their likes or dislikes and how to make them listen to you. Even a 1% increase in the customer retention rate can significantly decrease the customer acquisition budget. Existing customers are also less likely to put less strain on your customer support functions than a new prospect. Studies show that over two-thirds of the companies report a better return on investment when working on keeping previous customers rather than getting new ones. Although it may not be the right strategy for any business models, the relationship marketing strategy has significant benefits both for customers and for the company. Even if it may seem expensive at first, it is one of the most cost-effective strategies available so far. Focusing on the happiness of the customers, it creates a massive return on investment. Studies show that even a 5% increase in customer retention rates lead to a 25% up to 95% increase in profits. Loyal or returning customers spend a higher amount of money than a new one. Tactics for an efficient relationship marketing strategy vary from sending promotions to existing customers, to providing customer support, creative reward programs, email marketing or even a customer friendly return policy. They all have one sole purpose: keep the existing customers happy and increase the snowball effect coming from referrals and reviews.
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