When it comes to marketing, many businesses are so focused on actually attracting their customers that they forget about devising a plan for holding on to them. A good marketing plan will include a customer retention strategy that seeks to identify ways to entice customers to re-engage with the business through repeat purchases and / or referrals. An effective way to do this is through nurturing your relationships with your customers, which in marketing speak is referred to as relationship management.
What is relationship management?
Any relationship, whether it is business or personal, needs attention and consideration for it to thrive. Just like your spouse or partner will appreciate you remembering their interests or cooking their favourite meal, relationships with your customers will also benefit from a concerted and genuine effort to make them succeed.
Whether your business is product or service oriented will influence the type of relationship management techniques you use to engage your customers. In general, businesses that are service-oriented (eg. accountants, engineers, lawyers, health professionals etc) have a greater dependency on relationship management initiatives as their business is more focused on establishing long-term relationships with clients. However, product-based businesses can also successfully nurture relationships with their customers to boost sales.
Getting started
Depending on your level of familiarity with your customers, the types of relationship management techniques you use will vary significantly. Below are some simple techniques to get you started:
1. Assign a relationship manager to your key customers
Take a leaf out of your local bank’s books and assign a relationship manager to those customers that you know have the potential for continued engagement with your business. Set clear goals for the relationship manager and ensure that your customer is also aware of the benefits associated with being a ‘key customer’.
2. Devise a system for recording customer information
Whether it is an Excel spreadsheet or a fully integrated customer relationship management database, you need to have in place a system for keeping track of every interaction with your key customers (not just fees earned or sales made). Consider including information such as when the customer first engaged with your business, whether they should be receiving the company newsletter, their birthday, their partner’s name, any previous positions they have held and any associations they belong to. All of this information, plus anything else you feel is relevant, will not only help you to provide a much more tailored service to your customers, but will also assist you to focus your marketing activities according to your customers’ preferences and interests.
3. Involve your customers in the process
Relationship management is not something that should be hidden from your customers. Most of them should feel that they are highly valued if you have taken a genuine interest in their needs and in improving the level of service that you provide to their business. Make sure that you give your key customers the opportunity to provide you with feedback on all aspects of the relationship through conducting customer satisfaction research (see previous Savvy Express article), both formal and informal. As well as helping you to identify your business’s strengths and weaknesses, feedback gained from such research may also provide you with the insight to determine what the most suitable relationship management activities will be for particular clients.
Using relationship management techniques is an effective way to create meaningful and enduring relationships with your key customers. But a word of caution: relationship management can only be successful if it is undertaken in a genuine attempt to nurture the relationship rather than make an additional sale. Your customers will quickly spot the difference between a one-off invitation to dinner (right before they are due to decide whether to renew your company’s contract) and an ongoing effort to nurture the relationship through regular contact, regardless of whether there is any imminent business pending.
If you would like further information or help with establishing your customer relationship management program, please contact me on 07 3899 8335 or email megan@marketsavvvy.com.au .
Best wishes – Megan.