12/10/18

Relationship Marketing

Relationship marketing is all about creating long term customer loyalty through a variety of different methods.

Do you agree or disagree with these points:

• Customer expectations are often higher online than they are offline. – Agree: People always expect to see the best prices online and they expect the best customer service and a simple, speedy process to buy. More stock available online. Being able to see other peoples feedback on a product/seller is very useful.
• If you contact a company online you expect a response almost immediately. – Partly Agree: If you are emailing the company then I would expect a response within 24 hours but if it’s live chat then I would expect an immediate response.
• Satisfying a customer in a single transaction isn’t enough to keep their loyalty. – Agree: Personally I would’t decide that one site is the site for me after just one transaction, would probably take 2-3 transactions. Follow up emails are a good way to create customer loyalty.
• Something as simple as receiving an email that is irrelevant from a company can be damaging for them. – Disagree. I wouldn’t feel like one irrelevant email would put me off completely, however, if there were multiple emails then it would start to put me off.
• Customers are visiting fewer sites but spending longer on them. – Disagree. Depends who you are and what you’re buying. If you are buying a specialist item then you are unlikely to surf the web but if you are buying something like clothes then you will check all the websites like Boohoo and Asos to find the best deal. 90% of consumers buy from a result on the first page of Google.

Building Customer Relationships

Hochman (2008) states that customer relationships are the only thing that cannot be replicated by a competitor. It’s easy for a competitor to copy a product or a marketing campaign, but there is no way to recreate the history that consumers have with the original brand.

How can you build a customer relationship?

• Through social media
• Creating a positive website experience
• Analytics
• Apps

But these are just tools. How can you actually use them to create a positive customer relationship?

• Social Media – Responding to any messages that come through efficiently. You can monitor the number of likes and shares on posts to see what you followers like so you can create similar posts.
• Analytics – You can monitor the pages, time spent on pages, clicks, and demographics from your visitors to target certain areas of your site. On google analytics you can view what visitors are interested in which means you can target people that like a certain thing with emails and blog posts.
• Apps – Creating a good app means that consumers always have access to your site at the fingertips. Amazon has a great mobile app which perfectly replicates their online website.

Monitoring your customers means that you can react to their actions and steer your marketing accordingly.

TOP 10 SOCIAL MEDIA DISASTERS (NOT CLICKBAIT)

• Chick-fil-A – Gay people shouldn’t get married. They lost their toy partnership. Tried to cover it up with a fake account (ALLEGEDLY)
• American Apparel and The Gap – They used a hurricane to sell more stock by using a sale.
• Kenneth Cole – Sent out a tweet making fun of a political riot by saying it was because of their new collection.
• KitchenAid – Posted an offensive tweet about Obamas grandmother.
• Epicurious – Tweeted insensitive tweets on the day after the Boston bombings
• Kmart – Posted a tweet with an insensitive hashtag promoting the toys they sell after Sandy Hook shootings.
• The Onion – Posted a tweet calling a young actress a c*nt.
• Home Depot – Posted a racist tweet with 2 black people and one dressed as a monkey.
• DiGiorno – posted an insensitive tweet about domestic abuse.
• Progressive – Tried to why they didn’t pay out on a tragic case that they should have over twitter.

The problems with all of these tweets is that they were all very insensitive cases created by careless thinking around sensitive topics. Don’t try to capitalise off of tragic events. Have some common sense. Don’t alienate any people, even if they aren’t your primary target audience. Do the research about hashtags and trends on social media.

Customer Service

Negative customer experiences should not be ignored. They can be used as an opportunity.

One really good example of customer service i’ve seen was on eBay. I bought a game from a seller that had a good reputation. However, the product never arrived which led to me complaining. eBay dealt really well with my requests and gave me a full refund. Although the seller turned out to be bad it reinforced my trust with eBay as I know that it is easy to get a refund.

One bad experience my friends had was from Dominos, they ordered a pizza and it took 6 hours to get to them. They kept phoning up to ask where it was and they were always met with it’s on it’s way. Despite the fact that it clearly wasn’t. They never even got a refund.

Permission Marketing

One area that is seen as crucial in building a customer relationship is permission marketing.

It is important to receive permission from your audience to market to them as it ensures that you target people that are actually interested in your business. If you were sending emails to people that hadn’t given permission then it is more likely that people will complain about you on social media/ to their friends. There is no point wasting time and money creating campaigns targeted at people that aren’t interested in your business. As a consumer, when you sign up to receive marketing from companies it shows that you are in fact interested in what they have to offer as opposed to it being forced upon you.

• Offer Opt-in options e.g. Some people may not want a weekly email though may welcome information about new products. Options could include: Content, Frequency, Channel of communication.
• You need to consider what kind of information you want to collect for your database e.g. email address is essential but postcode is also useful for geodemographics. Age and Gender are also useful tools to find out who your average audience is.

GDPR (General Data Protection Regulation) was introduce in May 2018. GDPR applies to a company if it has an establishment in the EU or Provides good and services to EU residents. Protected personal data includes Name, Photo, Email address, Social media posts, IP address, Bank details, and Medical information. Data breaches must be notified to affected individuals without “undue delay” and data protection authorities within 72 hours. Organistation can be fined up to 4% of annual global turnover or €20 depending on which is higher. Even somebody contacts a company that company legally has to tell them what data they have on the individual.

• Offer a range of opt in incentives –  competition giveaways, free trials, extract from a book, discount codes.
• Don’t make opt out too easy! – Opt out or unsubscribe is a legal requirement! Use the step before the unsubscribe is complete to try to stop them from leaving, give people discounts.
• Monitoring activity using analytics can avoid intrusive questions and allow more targeted communications. You can monitor clickthrough to different content and email engagement, Send follow up reminders if emails aren’t opened and you can monitor times when a customer is most receptive.
• Develop a contact strategy: Frequency/interval, Content and offers, Links between online and offline communications and a way of managing this strategy.

Customer Lifecycle

Explain the different stages of the customer lifecycle

Reach: Trying to get the attention of the target audience we want to reach. This can be done via social media posting. e.g. Digital Freelance posting on Twitter and Facebook with links to blogs on our website.
Acquire: Attracting the people that we have reached on social media to connect with you. This can even just include liking a post. e.g. Somebody visits our the blog post from the tweet and then checks around our website more, maybe signs up to be on our email list.
Convert: When the people we have acquired decide to purchase something and become an official client. e.g. The potential clients on our list decide to have an initial consultation with us after receiving nurture emails and then decide that they would like us to help them with their marketing.
Retain: Trying to keep the customers we have and encouraging them to buy more. e.g. After the initial 3 months is up we try to keep them on retainer by offering them a lower price to maintain their marketing.
Loyalty: A customer turning into an advocate or partner. e.g. Once we have delivered the results and a client has been with us for a long time we ask them to leave a review/testimonial for us to use on our website. Or even become a partner with us. These advocates will then hopefully start to promote (reach) out to new customers.

Using Facebook

Many companies now use Facebook as a way of building a relationship between the brand and the customer.

They do this by:

• Allowing Public comments on the brand or company page.
• Recommendations based on likes by friends.
• Allowing Private Messaging to company pages.
• Chat bot interactions – often a way to deal with frequently asked questions.

Case Study

MuscleFood uses Facebook to increase customer engagement very effectively. In their about section it says that they take about a day to reply to private messages on average. This is ok but you would really want it to be much faster, preferably a couple of hours.

They are always posting about current events and keeping up with hashtags but also relating it back to themselves at the same time. For example World Mental Health Day was yesterday and they posted a video explaining how certain exercises can help with mental health.

They also post recipes for healthy meals on their page constantly and sometimes they only give out the recipe if you comment on the post.

As you can see in this example they use the post to entice consumers into wanting these supposedly healthy donuts. However they only allow them to have the recipe if they comment below. Another thing that they to in order to get more interactions on their Facebook page is giveaways.

They often do giveaways similar to this one where they give large bundles of meals/meats away for free to people that tag a friend in the comments of the post. This is so easy to enter which makes consumers think “why not enter it?”

Conclusion

 

• Relationship marketing and customer lifecycle marketing are based on the principle of exchange of value.
• Customers should be able to ‘opt-in’ when they want to interact with brands.
• It is important to come up with strategies for communicating across different channels to encourage the customer to engage and purchase/use the service.
• It requires a view of the customer that is not just short term but as someone with a ‘lifetime value’.
• The key principles in this relationship are permission, trust, listening and responding.
• This is the key to long term success.

Potential Exam Questions:

• Define what is meant by relationship marketing.
• Explain the benefits, limits and constraints of relationship marketing.
• Explain the importance to a business of new leads, existing customers and repeat customers.