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With most products and services competing in a largely parity landscape, the relationship your brand has with its customers is the only competitive insulation you can count on. Brands with a strong customer relationships are leading brands.
Let define our terms here. We’re not suggesting that the brand become the consumer’s friend. But, if consumers feels a degree of affinity toward the brand, all things being equal, they will choose the brand over the competition. Affinity, created over time, happens when the brand has relationship equity, when value beyond the functional benefits of the product has been created. The value can be practical, it can be emotional, and it can be both, but creating this additional value is key to creating relationship equity, it’s key to creating a brand from a product with a name.
Hip Shots
- Focus on Best Customers. There are typically the small percentage of your customers who contribute the majority of your volume and profit. They’re also the consumers who generate the majority of category volume. Understand who the heavy users are and what they need. It’s not what most need.
- It’s a commercial relationship. It is easy and often useful to associate the principles of personal relationships to relationship marketing. There is a key flaw in this thinking. There is a significant difference between personal relationships, the relationships you have with friends and families, and commercial relationships. Success can be found in understanding the differences.
- Build the relationship. Relationships don’t just happen, you have to work at them. Actively pursue the creation of relationship equity. This is the heart of branding and it’s often misunderstood and its importance underestimated. There are a lot of products with names out there masquerading as brands.
- Relationships are dynamic. A relationship goes through stages. This is obvious from your experience with personal relationships. Commercial relationships also go through stages, and each requires a different emphasis on contact frequency and content.
- Maintain the relationship. Once the relationship has been established maintaining it becomes vital. It isn’t hard but does require active involvement. One of the five relationship marketing principles is “Good customers expect to be rewarded.” Note, it’s “rewarded,” not bribed.
When value is created, either through additional information and/or services, or through exclusive access, or highly relevant sales offers, relationship equity is the result. With relationship equity you can maintain a profitable brand for a long time. Share your experiences in the comments. How have you created relationship equity for your brand?
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