Customer relationship marketing: The acquisition and retention strategy that keeps on giving

Customer relationship marketing relies upon building deep, meaningful connections with prospects and customers over time, favoring customer lifetime value (LTV) over short-term acquisition gains. It stems from a desire to provide real solutions to customers’ pain points until they achieve “peak customer” and move into brand ambassador territory.

From a revenue perspective, this approach to marketing and improving a customer’s experience is a direct response to the ever-changing statistic that it costs anywhere from five to 25 times more to acquire versus retain a customer. From a people perspective, customer relationship marketing is an approach with a high emphasis on integrity, empathy, and providing genuine value to the end user.

Customer relationship management (CRM), on the other hand, is a strategy for understanding the customers’ needs in order to optimize comms, often leveraging technology in the form of a CRM system. In other words, CRM is what empowers sales and marketing teams to deliver high-impact customer relationship marketing at scale.

Developing deep relationships with prospects and customers results in measurable benefits beyond initial sales revenue, such as:

1. More efficient resource allocation. By implementing customer relationship marketing, companies use data to identify high-value prospects and existing customers. They focus their marketing efforts on those who will be least costly in terms of relationship management as well as those who have untapped potential in terms of revenue expansion.
2. Reduced churn. Developing high-touch relationships with your customers and continually providing them with the best resources and opportunities to grow their businesses or improve their lives will endear them to your brand, making it less likely they’ll churn.
3. Improved product/service over time. Encouraging two-way communication by way of customer relationship marketing gives you insight into your customers’ pain points and how future products or services might address them. Not only that, you’ll also gain valuable feedback about your current offerings and how to improve them to better meet the needs of your target market, which is beneficial for brand loyalty.

As consumers become more savvy, more skeptical and have access to more options, brands will need to master customer relationship marketing and management in order to survive, let alone thrive. This means hyper-personalization, better sales and marketing alignment and organizational customer centricity.

Hyper-personalization

According to LinkedIn’s The State of Sales 2018 report, “decision makers are more likely to consider a brand’s products or services when the experience is personalized.”

This includes a clear understanding of the customer’s business needs and role, personalized communications and targeting the right person at the company for initial discussion.

Remember Michael Scott’s color-coded rolodex for his current customers? He kept detailed notes on all his customers to ensure that every conversation he had was personalized and relevant: “I color code all my info… Green means go. So I know to go ahead and shut up about it. Orange means orange you glad you didn't bring it up.”

This same individualized approach for strong customer relationships, combined with machine learning and tools to improve collaboration, productivity and overall efficiency is what we can expect to see more of in the future.

Companies like Spotify and Starbucks are already using predictive personalization with the help of machine learning, but most brands have a long way to go.

This is echoed by Evergage CEO Karl Wirth, who says the next evolutionary step in personalization is “using machine-learning-based algorithms and predictive analytics to present the most relevant experience to each and every visitor.”

Better sales and marketing alignment

Customer relationship marketing spans several departments including marketing, sales and customer success. Often, however, silos exist between marketing and sales, resulting in poor lead quality, customer churn and messaging inconsistency, including with current customers.

The same LinkedIn report mentioned above states “only 20% of sales professionals say they see significant overlap in the data used by marketing and sales to target prospects.”

This lack of overlap explains why only 22% of sales professionals say leads from marketing are ‘Excellent’ and 42% say they’re ‘Good’. Companies that lessen the divide—in particular, the data divide—between marketing and sales will come out on top.

Organizational customer centricity

At the heart of your business is your customer—they’re the reason your business exists. And yet many businesses these days aren’t operating as if they are.

According to research by the CMO Council, “only 14 percent of marketers say that customer centricity is a hallmark of their companies, and only 11 percent believe their customers would agree with that characterization.”

With such a small percentage of companies already doing this throughout marketing campaigns, there’s a huge opportunity to differentiate yourself from your competitors. Not only that, by shifting your company’s culture to be customer-centric, you’ll always be dialed in to your customers’ wants and needs—a surefire way to stay alive in a competitive economy.

1. Be consistent in your messaging.

Because marketing and sales are often siloed, it’s not uncommon for messaging to be inconsistent between the two when it comes to customer interaction. In fact, of 1,009 survey respondents, nearly half (48%) reported often or always experiencing different messaging from sales and marketing teams.

This misalignment impacts brand perception, which is another huge decision-making factor for buyers. Content marketing platform ClearVoice insists that in order for a brand to succeed, “every interaction customers have with your brand should embody the brand promises and values dependably and understandably.”

To ensure consistency with customer interaction:

• Create brand guidelines, which outline logo use, fonts, colors and more.
• Communicate brand values early and often internally—that means in your employee onboarding materials, at company-wide meetings and even in company swag.
• Create shared assets, which employees can easily access, such as logos, social media banners and slide deck and other document templates.
• Craft key messaging documentation about the company at large, as well as any major products, features and services your team typically mentions on sales calls or in marketing collateral. This should be done with any future releases as well.
• Define your brand’s personality in a style guide, and apply it to all channels, including outbound emails, social media updates and blog posts.
• Meet regularly with peripheral teams and keep the communication flowing.

2. Build trust.

Whether we’re talking about a marriage or a business relationship with a new customer, the same thing can be said: A healthy and fruitful relationship is rooted in trust. This information about relationship building is supported in the 2018 LinkedIn report, which cites that 51% of decision-makers rank trust as the most important factor they desire in a salesperson.

To build trust and create strong relationships with your prospects and customers:

• Be transparent about pricing, cancellation and return policies, additional fees and anything else that might make a prospect feel betrayed if kept secret.
• Provide social proof in the form of testimonials and detailed case studies.
• Follow through with promises and—whenever possible—exceed them.

3. Share your knowledge freely.

It’s easy to forget that you are an expert when it comes to your company’s offerings, so don’t undersell the value of your knowledge with loyal customers. Package your expertise up in the form of webinars, white papers, ebooks, courses, blog posts and more—and share it with your contacts.

But remember: Only share your knowledge when using a marketing strategy, if and when it’s relevant. According to MDG Advertising “nearly three-quarters (74%) of web users say they’re frustrated with sites that aren’t tailored to their needs and 72% of consumers say they don’t like generic marketing.”

4. Make communication easy.

There are few things more frustrating than poor customer communication—being put on hold for 10, 20, 30 minutes; being treated like gold by a salesperson only to become chopped liver once you’ve officially become a customer; never hearing back from that support ticket you submitted last week.

Offer customers multiple ways to communicate with you, including phone, email, social media and live chat. And be available to your contacts and potential loyal customers, no matter which stage of the funnel they’re in.

5. Empathize with your customers and prospects.

Truly understanding your customers’ wants and needs, pain points and problems gives you a solid foundation for all your marketing efforts—from top of funnel all the way through to customer retention.

To better empathize with your customers, gather feedback whenever possible—this can be in the form of on-site surveys, product beta programs, customer support NPS, emails and more. Appoint someone to be the “voice of the customer,” and make it their responsibility to make the feedback easily accessible and digestible for the other members of your team.

6. Incentivize return visits and purchases, referrals and engagement.

With the many options available to them, customers don’t inherently have reasons to come back to, refer or engage with your brand… so you need to give them some to help form a strong relationship.

Offer discounts to repeat customers, develop a loyalty program to brag about, run social media contests—these are just a few ideas on how to re-engage past customers, or even attract new customers. (More customer loyalty tips here.)

Building solid customer relationships using a marketing strategy is not a simple four-step process. It takes empathy, consistency, customer feedback and often a lot of time. You can learn more about how to do that here.

A robust CRM system can help reduce the effort associated with long-term relationship building by sending you follow-up reminders and giving you better visibility into where each customer is in the pipeline.

The long-term benefits of taking your time with a prospect or customer during a marketing campaign are both measurable and immeasurable. Increased LTV, decreased churn and — who knows — you might even make a friend.