Is It a Marriage or a Fling? Determining the Right Customer-Relationship Model
by Nate Smith
posted on 08-09-2016
I recently reread a great article on customer relationships, written by Andrew O’Connell from Harvard Business Review. The article puts forth several customer relationship types and discusses how to determine the value of those various relationships, both positive and negative. It got me thinking about how most businesses approach the customer relationship — trying to turn every prospect into a premium-paying customer with a large lifetime-value calculation to boot — akin to a marriage partner. Any client who doesn’t seem ready and willing to have this kind of relationship is immediately devalued, even considered a waste of time. The relationships that brands have with their customers are much like real-life relationships. Some first dates launch into something serious — even permanent — while others go nowhere. Some flings taper off, some relationships grow into rock-solid marriages — and there are plenty that fall somewhere in between. Like any relationship, forging these connections is never a linear progression — and, no two are ever identical.
Before diving headfirst into the deep end and deciding your relationships’ need to be meaningful marriages, it’s essential to understand the circumstances that organically lend to each — and, beyond that, which make the most sense for your brand, your organization, your immediate goals, and the customers you serve. Brand/Customer marriages are great but not for everyone every time. Sometimes, a relationship is nothing more than a brief fling — and everyone still goes home happy.
So, Who Should Be Proposing?
Marriages — Adobe and its marketing solutions are great examples. Customers invest heavily in their relationships with us, and we do the same with them. We’re in the relationship business, and the vast majority of the customers we serve are just that — long-term, ongoing partners.
Marriages tend to work in specific business models. In this example, we’re focused on delivering high-quality, enterprise-level products to brands and businesses that will need these solutions forever. In the B2C space, this type of relationship usually revolves around products and services consumers need or want with some degree of repetition as well as ongoing service products.
If they’ll be repeatedly consuming the product or service, a proposal may be in your future. In these cases, the stronger the marriages the better. For example, Amazon, FreshDirect, and Expedia all thrive on customers returning to their platforms to buy, order, and book. The stronger the marriages — based on trust in the brand — the less they must work to ensure their consumers return repeatedly. Marketing costs drop, average order values rise, and brand advocacy skyrockets.
In these instances, it’s essential that you approach the consumer with a long-term relationship on the mind. Don’t assume it; instead, focus on relationship builders that truly mean something — customer service and support, training, loyalty programs, and special offers, for example. Our team never approaches customer relationships as flings. If we simply made sales and moved on, our divorce rate would be through the roof. Customers would buy products, everyone would feel good, and we’d all move on. Maybe some would return because they realized the value on their own — but many wouldn’t. The long-term commitment to mutual organizational success would not quite be there, and we’d lose the love and loyalty as a result. Likewise, customers would be less invested, leading to missed opportunities on both sides — not ideal for anyone.
And, Who’s More of a Fling?
It’s all well and good, though, if your business model veers more into the fling zone — or even one-night-stand waters. If your product or service is meant to be temporary or a one-time experience, then the marriage model isn’t for you. And, that’s okay. Maybe you’re a travel company that offers once-in-a-lifetime vacation packages — sell one, and you’ve satisfied both the organization’s and the consumer’s goals. But, from day one, everyone’s on the same page that this is a one-and-done scenario. Or, maybe you’re a funeral home — with respect, you only need that once, right? One deal, one purchase, and well, the relationship ends.
And, You Cannot Forget the Blind Dates!
These are the anonymous visitors who visit your site, and you must immediately determine what to make of them. It’s essential to understand what both sides want coming in — is this person here just to download a trial of Photoshop, or is he an Adobe Marketing Cloud candidate? That’s a huge difference — one that, if mistaken, we could definitely miss out on! Leading up to the date, it’s all about gathering data from multiple channels to understand what the customer likely wants — what his or her expectations are.
When the blind date takes place, each side brings few details to the table about the other. The customer has visited your site before, and you know she visits from San Francisco. The blind date allows you to become better acquainted, to learn a little more about one another. Maybe, she spends quite a bit of time on your site, enjoying her experience, which enables you to gain a bit more insight. You start putting the pieces together by tapping into Adobe Analytics and Adobe Audience Manager. You now understand channel preferences, behavioral patterns, and trends and end up with a good view of this person. And, most of that’s credited to the blind date — the opportunity to see her interact with you and with different surroundings, enabling you to determine what the relationship would evolve into, if anything. You understand her motivations — the why of it all — giving you confidence to either move forward with a second date, move on, or completely reevaluate your dating strategy.
Are You Prepared to Evolve With the Relationship?
Let’s not forget — relationships don’t just stay in stasis. They either progress or regress. As you learn new behaviors, motivations, and objectives surrounding your customers, you must not only take those into account, but also reassess the relationship as a whole quite often. More recent behaviors or traits will matter more than older ones — even if your entire love affair is built upon those historical transactions.
But, that doesn’t mean all hope is lost if things start to look a little different — or even dicey. If you sense a change in the relationship, you must act quickly. If a customer wants to progress from fling to marriage, that will change the investment you must make — a shift that must happen instantly. If, instead, you have a solid marriage and there hasn’t been an exchange or interaction in a few weeks, you could find yourself on the outs if you don’t hop in quickly.
Plenty of these progressions exist in virtually every industry. Banks, for example, have plenty of flings-to-marriages happening all the time. Let’s say, a customer opens a credit card account at an event; maybe he opened it just to obtain a free gift. The customer wasn’t particularly invested, but the transaction still happened. Fast forward a few months, and this new cardholder has had a very positive experience with the bank, and now he needs a car loan. So, he calls, and now he has a credit card and a car loan — all with the same bank. A relationship is blossoming, reinforced by a mortgage, checking account, and investments — and, just like that, he’s in love and most likely there to stay. If a bank can get a customer hooked on three or more products, their attrition is virtually nonexistent.
Which Relationship Is Right for You?
So, which should you steer customers toward: marriage or fling? It really depends on your business. Not everyone or every business is marriage material. Marriages are costlier but can yield more long-term value. Flings come with significant acquisition costs — but few ongoing investments. Ask yourself what kinds of relationships you have, what relationships you should have, and what relationships make sense for your brand and your customers. From there, watch for things to change. That blind date could wind up being the love of your life.
Products: Photoshop, Creative Cloud