What Is Relationship Marketing?
Relationship marketing is a business strategy that builds and nurtures long-term personal connections between your brand and your existing customers, increasing engagement, satisfaction, and loyalty.
With increasingly expensive customer acquisition costs, customer retention is one of the most critical factors in a company’s success. According to Semrush, the probability of selling to an existing customer is between 60% and 70%, whereas the likelihood of selling products or services to a new customer is only between 5% to 20%.
Relationship marketing is a force multiplier. How? Quality customer experiences deepen the trust and devotion customers have for your brand. Many companies strive to offer a great customer experience but also, need to ramp up their customer retention strategies. Interacting with repeat customers through ongoing conversations creates bonds that competitors struggle to break. The result: Long-term customers who increase your customer lifetime value (CLV), customer retention rate, and even generate new leads.
Let’s dive in and showcase five businesses that are hitting it out of the park.
Here Are 5 Relationship Marketing Examples
Grab started out as a ride-hailing app but has since created a viable ecosystem in Southeast Asia covering transport, food, supermarket, and package delivery, offering plenty of available jobs to their partners. Grab gave opportunities for drivers to earn additional income via using its app platform. For example, Grab helps new drivers by giving them mobile phones with a payment plan, and the team reaches out to these drivers to explain its app, WhatsApp, and Google Maps services. This ensures their drivers are equipped with the knowledge that they need.
Customers are everything to Grab, and the company goes beyond to serve its customer needs and enhance its partners' experiences. Grab continuously cultivates its partner driver's relationship and enables drivers to earn additional revenue than the average taxi driver. Like-minded consumers are inspired to support a brand like Grab that concretely demonstrates its values.
Starbucks helped make getting a cup of coffee what it is today. Starbucks is a cultural icon as it is a business, showcasing its ubiquitous cups in social media posts on Instagram, Facebook, Twitter, and Pinterest. For example, Starbucks’ tagline on Pinterest reads, “Inspiring and nurturing the human spirit – one person, one cup, and one neighborhood at a time.”
Starbucks sends frequent emails to their customers, informing them of exclusive offers and new beverage launches. They also share customer content and interact with them on their social channels. Their tight-knit community often lines up before sunrise for the chance of obtaining their latest holiday-themed cup or specialty beverage.
General Electric (GE) is a multinational conglomerate whose tagline is “Building a world that works.” GE has set itself apart from traditional energy companies by positioning itself as an innovator, thought leader, and sustainable technology company. In addition, GE has focused on employee participation and compelling storytelling to craft an identity as a global content marketer.
Their GE Reports website is an excellent example of content marketing, including podcasts, articles, videos, and infographics that help build strong relationships with customers. They achieve their goal of informing and educating their shareholders and the public about relevant topics through curated content for segmented markets.
4. American Express
American Express (Amex) has successfully mastered the customer journey. Its strategic marketing campaign approach encompasses account applications, onboarding, engagement, cross-selling, and referrals, making it one of the most successful credit card businesses today.
Their account opening process is customer-friendly and straightforward, taking only 30 seconds to complete. New customers receive bonuses via direct mail, including discounts and travel perks. In addition, their multichannel “Share the Love” referral program (promoted online, on social media, and via email marketing) is strong, granting the referring party 15,000 bonus points.
To capture the elusive millennial market, Circles.Life disrupted the telco industry in Singapore and began offering consumers mobile services without long-term contracts. This approach (unorthodox for telecom carriers) proved wildly successful, improving customer satisfaction, engagement, and referral business.
Despite not having a brick-and-mortar store, Circles.Life leverages social media platforms to engage and convert customers. Their marketing team also relies on these channels for social listening and enhanced customer engagement such as actively gathering reviews and product feedback and launching new products based on the customer's valuable inputs.
In addition, Circles.Life's referral program has been the most effective channel for customer acquisition as over 40% of their transactions are due to referrals via word-of-mouth. Every Circles.Life customer has a unique referral code that can be shared with friends and family.
Benefits of Relationship Marketing
Now that you’ve seen the inspiring relationship marketing examples, let’s discuss some of their benefits.
Higher Customer Retention
Relationship marketing turns potential customers into happy, loyal customers who often buy products and services from companies. Studies show that fully engaged customers spend 23% more than unengaged customers. Cultivating loyalty with existing and new customers is key to your business's success.
Happy customers want their friends and families to get acquainted with their favorite brands too. 92% of consumers trust referrals from people they know, and customers referred by a friend are four times more likely to buy.
Even in this digital age, word of mouth is priceless, and you should treat any customer who refers their friends or family to your business with utmost satisfaction.
Return on investment is a key performance indicator (KPI) that often determines a marketing strategy's success or failure. Increased retention drives customer acquisition costs down, making more marketing dollars available for long-term relationship marketing efforts.
Increased Competitive Advantage
If you think everyone has realized the value of relationship marketing, think again. There are still vast opportunities to use this powerful tool to gain a foothold in a very competitive marketplace. Building quality relationships can help you stand apart in the sea of sameness, cementing long-term success. A proactive, personal approach to customer service goes a long way in terms of customer retention.
Enhanced Brand Reputation
Happy customers are your most important asset. Satisfied customers often use social media platforms to talk about their experiences with companies, both good and bad. Inspiring your customers to sing your praises enhances your brand reputation, leading to new customers and repeat sales.
Ready To Get Started With Relationship Marketing?
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