This marketing mix management approach has sales as the primary goal and while this may be useful for consumer goods, this approach now holds little relevance in the growing Business-to-Business (B2B) market and service industry.
These limitations resulted in a new approach to marketing based on the creation and maintenance of relationships. This whole process is called Customer Relationship Management (CRM) and our focus this week is to show you why you should adopt this approach if you hadn’t already.
Dump the quick sale mentality for long term, win-win relationships. The general marketing management sees sales as an end – the only end, what happens after that is irrelevant. Clearly this approach is not client or consumer focused but looks at the best interest of seller. However, today’s consumers are no longer “anonymous” but smarter and more demanding and keeping with this approach will lead to poor performance on the long term. Instead of focusing on the sale, shift your attention to fitness for purpose, quality and value for money. This is what the customer really wants so never ignore it.
Competition is always lurking to pounce on failed relationships
Companies that continue to use the zero-sum, adversarial, once-off sale marketing approach will lose out to companies that promote long-term win-win relationships. One way in which consumer can judge your focus (the sale or the relationship) is through your responsiveness. For example, when millions of BlackBerry customers across four continents went without email, messaging and browsing services for over a week, the company took it’s time to respond and a statement came out days after the crisis hit. Now customers don’t appreciate that. In many cases, businesses send out bills timeously and expect prompt payment but when it comes to customer concerns, they have all the time in the world, it seems.
The result of BlackBerry’s unresponsiveness was a slump in its stock value and a flood of customers away from its platform to Apple and Android supported platforms. There is talk of Research In Motion (company that owns BlackBerry) splitting due to that fiasco. We will see how that pans out but the lesson here is that value all aspects of your relationship with clients as much as your value the financial side.
Enhance Marketing Efficiency through better targeting
Agile customer relationship management will enable you to implement database or direct consumer marketing that enhances marketing efficiency through cost saving targeted marketing. The main advantage of this approach is that by directing the right products or services to the right people (based on database information), you significantly cut down the time cost to your marketing activities.
Unlike your sales driven competitors attempt to sell to anything that has breath, direct your attention on to those prospects that have the highest probability of the “the perfect fit” based on your database information. The hard part is creating a rich database that stretches far beyond a name and email address. This is only achieved consistent interaction with your client with the view of establishing long term relationships.
Maximise on the lifetime value of each client
If you hold on to the traditional view that client “previous and future transactions are irrelevant”, you miss out on potential sales revenue from that same client. Relational marketing makes every effort to not only retain the customer for future business, but to explore other opportunities to cross sell other products and services to that client.
Retaining a client through relationship will give you value in two ways. Firstly, there is a cost to acquiring each client and by retaining the ones you have, you save on the cost of acquiring a new “replacement” in the event that you lost them through a failed relationship. Secondly, up-sell and cross selling opportunities give you opportunities to get more from one client at minimum effort.
To conclude, the key is to always remember that unlike in past decades consumer were behaviour was relatively predictable and “homogenous”. Today’s market consists of highly individualistic consumers with different tastes, preferences and convictions. It is now important to build lasting relationships with segments that benefit most from what you have on offer.
Post published in: Business