Chris Moerdyk
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Chris Moerdyk
Marketing Tips

Getting a good ROI from relationship marketing

Relationship marketing. That's the buzz these days. One on one. Eye to eye. Mano a mano. Get to know your customer, build a relationship, get some trust going and all will be hunky-dory and smell like roses.
Well, that's the theory anyway.

There are however, two hidden dangers that can make a relationship marketing exercise come back and smack you in the face with an intensity varying from wet fish to napalm.

The first is gathering information about a customer willy-nilly without giving any thought to respecting privacy. The second danger is not collecting enough information and heading into a relationship half cocked.

But first, the issue of respecting the value of privacy. An expert on the subject is American customer service guru Don Peppers whom I met when he visited South Africa a couple of years ago and who kindly keeps me up to date with latest trends via an e-mail newsletter. This is what he has to say:

"Be careful with your customers' private stuff. If you don't safeguard personal information - which is the foundation of a customer relationship - you will undermine your attempts to build loyalty.

"A recent survey reports that Americans are concerned about how their personal information is being used. Consumers, in short, are weighing the advantages of new interactive selling models with worries about how their personal information is being used.

"Consider these facts:
  • Four out of ten respondents, about 78 million Americans, believe they have been victims of consumer privacy invasions.
  • Eight in ten American adults (158 million) feel they have lost control over how companies collect and use their personal data.
"Yet at the same time, American consumers say they want customised service. A majority of customers surveyed said they want banks, credit card firms, retailers and telephone companies to inform them about products and services that might be of interest to them according to their profiles.

"Public approval rises to more than 80 percent if they are told how personal information will be used and given the chance to opt-out.

"Bottom line: one-to-one marketing is a two-way street, and consumers must be given some control in the relationship."

Now for that second danger. Not accumulating enough information.

For example, journalists are the target, or customers if you like, for hordes of PR people trying to get free publicity for their clients. Like other marketers they try to build up relationships and understand their customers' needs and wants. And often come horribly unstuck.

Like the invitation a journalist friend got a while back. In the envelope was a cigar and a request that I join a group of people for dinner in a new cigar club restaurant. Having very reluctantly given up smoking recently the last thing he needed was this kind of temptation.

Should the PR company concerned have made it their business to find out before sending out the invitation, whether he was a smoker or not? I believe it was imperative.

Imagine sending a present of a bottle of whisky to a recently rehabilitated alcoholic or giving a line of credit to an obsessive gambler ?

That's the problem with one-to-one marketing. If you don't know enough about your customer, he or she will pick up very quickly that all you are after is a quick sale and that you are making overtures at their wallets an absolutely nothing else. Which is both patronising and insulting.

Relationship marketing is incredibly powerful. Trouble is, like all powerful things it has the capacity to blow up in your face if you don't use it properly.

25 Aug 2009 13:28


About Chris Moerdyk

Apart from being a corporate marketing analyst, advisor and media commentator, Chris Moerdyk is a former chairman of Bizcommunity. He was head of strategic planning and public affairs for BMW South Africa and spent 16 years in the creative and client service departments of ad agencies, ending up as resident director of Lindsay Smithers-FCB in KwaZulu-Natal. Email Chris on moc.liamg@ckydreom and follow him on Twitter at @chrismoerdyk.