Relationship Marketing: Benefits & Challenges

Lesson Transcript
Instructor: Danielle Reed

Danielle works in digital marketing and advertising. She holds a bachelor's degree in English and an MBA.

Relationship marketing focuses on customer satisfaction to ensure long-term engagement and to build customer loyalty. Explore the benefits of relationship marketing and the challenges associated with it. Updated: 01/12/2022

Relationship Marketing

Think about branded clothes you wear. Think about brands you won't wear. Why do you make one decision versus another? Although you may not be consciously supporting a company, you show you are loyal with a brand name emblazoned across your chest.

Now think of this from the side of the business. How did it get you to wear its name? Relationship marketing is all about keeping your customers interested and buying from you. From the tone you use in your email communication to the implementation of rewards programs, relationship marketing is about building a business with and for your customers.

The definition of relationship marketing is the facet of customer relationship management that focuses on customer loyalty and long-term engagement rather than simple customer acquisition. Loyal customers come back again and again.

Relationship marketing is all about emotion. Customers should feel engaged with you, as if you are sharing your business story with them. You want to create an emotional connection with this customer. This boosts loyalty and makes it tougher for them to leave you for another brand.

Think about some of the emails you receive from your favorite companies. What do you like about them? Do their marketers seem to know you? Relationship marketing makes price changes easier to roll out. It makes hiccups in service easier to explain. Ultimately, it boosts your bottom line.

It's important to note that the opposite of relationship marketing is transactional marketing. This strategy focuses on a single transaction, or just making the sale. It's about the highest number of individuals purchasing rather than the people making those purchases.

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Relationship Marketing: Benefits

Whether you are a service or product-based business, relationship marketing brings you a number of benefits. These almost always include:

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