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Brand equity, loyalty, or affinity are really just terms used interchangeably to describe trust. While all brands strive to build trust with their customers, trust is earned, not given.
According to a recent study by Nobleman88% of respondents stated that trust was an important factor in purchasing decisions, one percentage point less than the financial value of the products.
To build trust with customers, brands must demonstrate value and foster interpersonal relationships with their customers. That’s why marketers should prioritize relationship marketing strategies that focus on retention as much as they do acquisition, and I’ll show you how.
Related: Connecting with your customer is the driving force behind relationship marketing
What is relationship marketing and what are the benefits?
Relationship marketing is a strategy designed to build strong relationships that foster greater brand trust over time.
Relationship marketing can differ from most traditional push marketing strategies that prioritize one-off sales and customer acquisition. However, most marketers today are prioritizing relationship marketing as an integral part of both acquiring and retaining customers as it saves them costs and increases profits over time.
While the old rule of thumb that acquiring customers costs five times more then storing it may not be quite correct, Research has shown that a 5% increase in customer retention can add up to 25% in profit over time.
The traditional Pareto principle states that the majority of your revenue comes from a small minority of customers who are most loyal to your brand.
Fostering loyal relationships not only increases sales from a single customer – without additional advertising costs, but also leads to additional opportunities, such as increased word of mouth and upselling opportunities.
Nevertheless, the data clearly shows that customers demand more trust from brands. Therefore, relationship marketing should be considered as part of any push or pull marketing strategy.
Overall, relationship marketing offers a host of benefits, including:
Of course, if you want to do relationship marketing well, you need to know how to influence and win over your customers.
Related: 3 Best Practices for Building Lasting Customer Relationships
5 ways to improve relationship marketing
1. Build your buyer persona
The first stage of any relationship is getting to know each other; this is no different for brands and customers.
Conduct detailed demographic and psychographic research to build a buyer persona of your ideal customer. For example, if you sell SaaS products, your ideal avatar might be people with a manager-level job title, a high salary, or an occupation in a tech-related field.
I’ve found that tools like Meta’s Audience Insights and keyword research tools like Ahrefs, SEMrush, and Google Keyword Planner help me the most when building a customer avatar.
2. Develop a brand image
Understanding your customers is the first step towards a healthy relationship. Now you need to find ways to make your brand indispensable in their lives.
Cultivating a brand image isn’t just about meeting your customers’ demands through a valuable product; it’s also about creating an emotional impact with them. While many people don’t need dozens of pairs of Nike shoes or Gucci purses, these brands conjure up an image that is essential to the personality and lifestyle of their customers.
There are several ways brands can have a deep emotional impact on their customers, such as:
- Interdependence: “I can’t live without makeup brand ‘X’.”
- Nostalgia: “These shoes remind me of my childhood.”
- Loyalty: “I am a Nike fan and will not buy any other shoes.”
Projecting a global brand image relies on cultivating a unified brand image seamlessly through your marketing and distribution process. Here are some tips to consider:
- Make products exclusive or expensive to project luxury
- Use specific influencers aligned with your brand to promote its image
- Use content and stories to promote the brand’s mission (ex social responsibility or sustainability initiatives)
Related: Why Relationship Building Is The Marketing Secret No One Is Talking About
3. Find creative ways to engage customers
Every brand has a social media account and its own discount programs, but there are ways to get a head start with these creative ideas:
- Organize local events or fundraisers for charity
- Sponsor local organizations that promote charities
- Join the digital economy by offering redeemable online tokens or points of sale for purchases
- Use blockchain for online purchases and in supply chains for greater security, transparency and less risk of fraud or counterfeiting
- Offer an exclusive store credit card or loyalty program with discount and coupon offers
- Invest in digital assets such as virtual storefronts, NFTs or live events through Metaverse platforms
4. Perfect customer service
Most importantly, if you want to maintain strong relationships, you need to improve one-on-one relationships with customers. Here are a few quick tips to improve your customer service:
- Never outsource customer service requests and never use ATMs
- Respond quickly to complaints via social media or review platforms
- Offer amicable solutions to bad reviews and experiences
- Use chatbots on websites to help customers
- Host forums where customers can ask questions about products or services (if applicable)
- Use tutorials to help customers solve problems without the help of a person
- Offer consulting or installation services for physical tasks that are difficult to solve over the phone
Related: 5 Creative and Fun Relationship Marketing Ideas to Increase Sales Without Selling
5. Be authentic
Finally, your brand must be authentic if you want to build trust with customers.
To be authentic, your brand must:
- Be transparent
- Understand your customers
- Call on their pain points
To promote these qualities, you need to invest in brand stories that show the real people behind your company and its mission. Market and tactfully market any corporate social responsibility initiatives your brand undertakes.
Building customer relationships isn’t difficult, but it does require your brand to think outside the box. Gimmicky sales promotions and using the same old marketing strategies as everyone else will ensure that your brand is nothing but forgettable in a sea of endless choices.