Relationship marketing – what is it and how can you use it?

Different kinds of marketing campaigns work in different ways and we can divide the field into a few distinct branches, like relationship marketing. What is relationship marketing? It focuses on personalised communication with each customer. It It aims to build, develop and maintain the relationship between the customer and the company - development which benefits each party.

Why is it worth using relationship marketing?

Your approach to customers has taken on greater significance. The reason for this is clear - it’s easier to keep a loyal customer than it is to gain a new one. A loyal customer typically returns to the same shop instead of going elsewhere. Additionally, that loyal customer can also recommend his preferred brand to friends since he obviously has a favorable opinion of it.

Relationship marketing reaches places where traditional marketing does not. This is primarily due to the fact that a one-size-fits-all marketing message cannot possibly appeal to the needs of all segments of the market.

Traditional marketing is a one-way transfer of information - without a return message from the customer, without feedback about his needs and point of view and without any information about his reaction and therefore without a clear idea of the effectiveness of the marketing message. Consumer tastes change over time and traditional marketing often moves too slowly to identify those changes and react to them.

 A change of perspective

Relationship marketing focuses on the needs and interests of the customer. As a result, communication centers on what is important from the point of view of the consumer, not the sender. The customer is always the most important!

More than ten years ago, Philip Kotler wrote about how trends had been reversed in a significant transformation:

• from marketing based on a product to marketing based on the customer
• from “produce and sell” marketing to “sense and react” marketing
• from focusing on market share to focusing on a share of the customer’s attention
• from an emphasis on getting new customers to an emphasis on retaining existing ones
• from gaining customers to keeping them
• from indirect marketing to direct marketing
• from marketing activities to a dialogue with the customer
• from marketing run by the marketing department to marketing run by everyone at a company

In other words, from transaction marketing to relationship marketing.

Relationship marketing in practice

Relationship marketing needs a specific path to reach customers. Among other channels, this can be email, which offers lots of personalisation possibilities, targeting specific groups of subscribers and delivering just the right text.

The following description of a marketing campaign is based on the marketing activities of a company active in the fashion industry.

The opportunity for the marketing team was a promotion based on discounts for various categories in a clothing store. They assumed that:

• they wanted to show discounts in separate mailings instead of all together
• they also wanted to personalize the message with an emphasis on long-time customers selected by standard RFM segmentation.

In order to present more discounts, they used an easy-to-understand graphical representation - playing cards correspond to the different categories of rebate. The text that was added helped to soften the image a bit by making it less like an advertisement and more like an announcement.

Frequent and occasional customers received different messages. There was more of an emphasis on the first group, which received messages everyday for more than a week, with the first message with the subject line:

The open rate of this message surpassed 30% and the CTR nearly hit 20%.

The content of the messages was:

The next message after that referred to the previous one and started with:

A very interesting effect was brought about by the last message in the series - the promise of a discount for anyone who opened all the messages sent during the week:

It turns out that tons of people went back and opened previous mails that they had not read, just to see what the bonus was. The campaign delivered open rates of nearly 100% and a CTR of almost 60%!

Relationship marketing in a nutshell

Marketing communication has evolved from impersonal messages related directly from companies informing potential clients about new products to personalised, individualized two-way communication creating a flow of information both from the company to the customer and back the other way. We encourage you to explore this subject more because the rewards to your business definitely make the effort worthwhile.