As a business owner, sooner or later you will run into this dilemma.

Should you grow as much as possible, and acquire as many new customers as possible…

…or focus on your existing customer base?

At first sight, these two objectives seem mutually exclusive. After all, if you’re focused on getting more paying customers, the way you treat your existing customer base must necessarily come second… right?

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No, not at all!

The idea of growing while taking care of your current customer base isn’t new. But nurturing your current customers to drive growth and get more people to buy your products and services is a relatively new concept called “relationship marketing”.

What is it? If we tried to define relationship marketing, it would go something like this:

“Relationship marketing is a form of marketing that emphasizes long-term connections with customers, as opposed to focusing on immediate sales. Its main objective is to give prospects the information that serves their needs, interests, and desires — and educates them into becoming paying customers.”

Let’s dig into what it really means, and how you can apply the paradigm of relationship marketing to your business.

Does relationship marketing really make sense?

Right now, an average customer is more informed and pickier than ever before. Many would argue that developing a long-term, practically useful relationship with them is the only shot at earning their trust and, eventually, their business.

What happens when you play the long game and invest in a strategic relationship with your customers? Lots of good things.

They buy more of your stuff (and more often) — sounds obvious, doesn’t it? Loyal customers buy more stuff, sun rises in the East, and the book is better than the movie. What else is new?

Loyal customers are less likely to switch — this is a funny one. You see, we find more and more evidence that brand loyalty doesn’t really exist.

That said, when your business is practically useful to your customers, and you’ve helped them on several occasions, they are much more likely to treat you differently.

And even if your competition is stronger and richer, they’ll stick with you.

Expanding and growth become easier — when focusing on your existing customers through relationship marketing, you will have an easier time growing. This is a counter-intuitive outcome of relationship marketing we should talk more about.

Here’s why it happens:

  • Word-of-mouth is the most persuasive marketing channel. People trust their friends’ opinions above all else.
  • As many marketers (including Seth Godin) observed, people can be reluctant to recommend products or services, because they don’t want to take responsibility for someone’s bad experience or be judged for what they love.
  • Relationship marketing removes that barrier. By becoming a company your customers love, you instill confidence that their social circle will love you, too.
  • Cue growth — and at a much lower cost per acquisition, too!

Top 3 relationship marketing channels

You can cultivate long-term relationships with your customers through a variety of channels, like social media, online and offline events, surveys, and basically any interaction you have with them…

…but not all channels are created equal. We’ve picked the three we consider the most effective: customer service, content, and email.

Below, you will find one actionable relationship marketing strategy for each of those channels.

1. Customer service

Customer service isn’t just a cost of doing business — it’s an investment in your growth. The more you delight your customers, the better.

So what’s the strategy? Implement company-wide support — if only as an experiment.

When everybody, from the IT person to the CEO, has a chance to interact with customers and make their lives better, it achieves two major outcomes.

First, it sends a powerful message to your customers; a message that says, “We care about you”. Many businesses still treat customer service as a necessary evil — this strategy positions your company squarely with the visionaries who recognise it as an invaluable marketing channel.

Second, it casts your entire business strategy in a different light. Put simply, nobody is better equipped to tell you how best to improve your products or services than your customers!

When your employees have first-hand experience with what customers love and hate, they make better decisions, and the company as a whole gains a competitive edge.

2. Content

On our blog, we’ve discussed content, and content marketing, a few times. But really, it all boils down to one simple directive…

Invest in free, high-quality content… and teach your customers to revere it.

The most prominent content marketers invest as much as $30,000 in high-quality content that they proceed to give away for free. Now, why would they do that?

Remarkable content is a tireless evangelist of your business. It can convert more paying customers for you than an entire team of full-time sales people. When you invest in something truly exceptional, the return on your investment is potentially unlimited.

But perhaps the most important part is teaching customers to value and revere what they get for free. You see, studies show that most consumers couldn’t care less about freebies… unlike something they’ve invested in.

To make sure that your content delivers results, and elicits the correct reactions from people, you need to explain to them why it’s valuable.

Maybe your team poured 100+ hours into creating a particular piece of content. Perhaps you paid thousands of dollars out of your own pocket to create something remarkable. What if applying your free advice could make your customers hundreds of thousands of dollars?

Tell them about it! That way, your content will escape the sad fate of gathering digital dust on someone’s hard drive. As Jay Abraham said, “Don’t just expect others to revere you, teach them to.” This applies to everything you produce, too!

3. Email

Email is still the most effective marketing channel. The humble inbox is the place to build lifelong relationships with your customers, because it’s so personal and distraction-free.

With email, the best relationship marketing advice is also the least helpful:

Maintain a balance between adding value for free and selling.

Most businesses gravitate to one of two extremes. They either never try to sell their email subscribers anything, and just send them “updates” about the company (nobody cares)…

…or they try to sell with every email they send.

Nothing teaches people to ignore your emails faster than selling all the time. And sending matter-of-fact “updates” is yet another sure-fire way to do the same.

When someone signs up to your email list, you need to build rapport with them. This means:

  • Sending occasional emails without any calls to action.
  • Asking them for their opinion.
  • Trying to teach them something.
  • Making occasional requests.
  • Emailing for fun, just because you want to share something.

When you’re friends with someone, and they only contact you when they need something, what do you do? You learn to ignore them. Email marketing works the same way. Treat it as a two-way street, and provide real value before you ask anything — whether practical, or purely entertainment.

Relationship marketing is a great investment that can help your business grow without constantly worrying about competitors, changes in demand, or growing costs of acquisition. It’s an asset any company should develop — and we hope these strategies help you lay a solid foundation for future business growth!

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