Relationship Marketing is an important part of brand development, focused on the long-term benefit of customer retention. This strategy places an emphasis on building customer relationships. In the modern age, marketing has evolved to include many technology-based methods, including email, video, and social media. There are benefits and challenges to relationship marketing across these various means, although it could be argued that connecting with customers has never been easier than it is today.
Relationship marketing is of particular importance when there is a competitive market for customers. When faced with many choices for the product or service they desire, customers seek to make a connect with a brand or company. That connection will fuel their consumer decisions in the future, and is often built on unique features of a brand. Some customers may gravitate to popular, well-know brands; others may gravitate to local, niche brands.
Relationship marketing usually features a combination of customer retention and customer satisfaction. Customer retention focuses on repeated transactions between customers and companies, building long-term relationships. Repeat customers are often less price sensitive and less inclined to switch companies. Because long-term customers are familiar with goods and processes, these relationships are cheaper to maintain when compared with the cost of attracting new customers.
An added benefit of customer retention is the likelihood that long-term customers will bring additional revenue to companies by word of mouth. Ensuring customer satisfaction, by building customer relationships with many positive associations to a specific product or brand, gives a worthwhile return on investment. Knowing the specific interests and desires of customers is done by accessing names, addresses, demographic information, buying history, and many other variables available with today's analytic technology.
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