A Good Relationship Is Your Best Marketing
|by Richard K. Hendrie, March 2005
‘Happy-ever-aftering’ is a dream for most of us. Establishments who play to that yearning with a personal touch and a distinctive experience win the competition for guest patronage every time. In the counter-intuitive world of relationship marketing, these feelings can be leveraged into profit and life-long guest loyalty. Here, ‘the being’ part or ‘form’ and ‘the doing’ part or ‘function work in tandem.
What are you "Being" when you use relationship marketing as your primary tool to build sales?
Personal: - You know your guests; their names, their jobs and their families, for three. You acknowledge them for their patronage and reward their loyalty.What are you ‘Doing’ when you use relationship marketing?
Measuring: -You know how often guests come and how much they spend. You benchmark what they like and dislike and dig deep to understand what their hopes are that lie behind their expectations.Why does it matter? Because the old measures and tactics in the Service Economy do not work anymore. Measuring Guest satisfaction, for starters, does not prevent guests from defecting to the competition. According to Fredrick Reichheld in The Loyalty Effect, between 60 & 80% of all customers who indicated satisfaction, in fact, defected to a competitor. When a company put huge dollars and emphasis against improving guest satisfaction, the numbers dropped to only 40% who defected. 40%!! That’s no number I’m interested in achieving.
What about advertising? The numbers are as disturbing. According to Sam Hill in 60 Trends in 60 Minutes only 9% of the people who were shown a brand’s commercial were able to recall the brand’s name right after seeing it. Direct mail redemptions are down to where 1-2% is considered a homerun. Makes you all warm, right?
We’re now in the Experience Era. While we are here to feed and nourish our guests with superb food or offer the solace of true hospitality, our job is deeper, more difficult and more rewarding. The most successful brands offer a unique and customized experience based on an ongoing conversation with their guest. The customization works off of one of several templates, for sure, but it feels like a personalized "third place" for happy-ever-aftering each guest craves.
So what does this look like? The Guest Relationship Marketing Matrix outlines six inter-related areas of focus, some which directly generate increased traffic and sales and some which foster deeper, more personal, more competitively pre-emptive relationships. These produce increased sales and traffic, as well as, raving fans that cannot be stolen away by price, clever promotion or gimmicks.
They are broken into two groups:
1. Sales Generating:
|Also See:||Ask What Makes You Great; Questions for Hospitality to Ask Itself / Richard K. Hendrie / February 2005|
|Great Service Grows From Great Praise / Richard K. Hendrie / February 2005|
|Is it ROI, Return On Investment or ROL, Return on Loyalty / Richard K. Hendrie / January 2005|
|Brand Enhancement: Invite Surprise and Delight Into Your Operation / Rick Hendrie / November 2004|
|Your Experience Is The Brand; Good Hospitality, Food and Service Are Merely Entry Points into Being Competitive / Rick Hendrie / November 2004|