June 13, 2024

Jeff Bezos, the founder and CEO of Amazon, the wealthiest person in the world, says: “The single most important thing is to focus on the customer obsessively.” We want to be the most customer-centric business on earth.

It’s less exciting or glamorous than sales or product development. Customer relations are essential to long-term business success.

What exactly is Customer Relations? Why is customer service so crucial to the success of your business? How can you do this well?

This article will teach you how to build better customer relationships. So buckle up!

What is Customer Relationship?

This is the process that a company uses to develop proactively positive relationships with its customers. This includes marketing, PR communication, sales, and customer services.

Customers must be delighted and engaged with the business.

The result is a positive outcome, such as Customer Retention and a higher Customer Lifetime Value. The degree of satisfaction with the customer throughout the entire buying cycle is a good indicator of success in customer relations.

Let’s put aside the jargon and focus on building a solid connection with your customers.

Larger companies hire specific people to manage how they communicate with and interact with customers.

Let’s be clear about one thing:

Customer Service vs. Customer Service

These two terms can be used interchangeably and often need to be understood.

They are related, but they have a significant difference.

Customer service is reactive.

Customer service is the process that delivers what the customer ordered. Customer service is about handling things that don’t go right and answering inquiries.

You have to keep your end of the bargain.

Jeff Bezos once said: “The best service for customers is when they don’t have to call or talk to you. It just works.”

Bezos said customer service involves responding directly to each customer via phone, email, or chat.

Customer relations, on the other hand, is proactive.

It is engaging with and interacting with customers and prospects to create a genuine connection and goodwill. This will lead to loyalty and, ultimately, a strong brand.

How does it help you grow your business, then?

Three Reasons Why Customer Relationships are so Powerful

Why should you prioritize customer relations now that you understand what it is and how it differs?

Do not underestimate the power of word of mouth

The opinions of people about your business are essential.

According to Nielsen, 92% of consumers trust recommendations from family and friends over any form of advertising.

Bezos stated in an article on Forbes that “it used to be if you were able to make a customer happy, they would tell their five friends.” With the Internet’s megaphone, online reviews, and social media, customers can now tell up to 5,000 people.

In today’s world, the word spreads quickly.

Bezos says: “If there is one reason why we’ve done better than other companies in the online space, it is that we’ve focused like a laser beam on customer experience. And this matters… in any business.” It is essential online, where word of mouth can be compelling.

United’s customer service hasn’t been doing too well lately. From the much-used Twitter hashtag “#UnitedAirlinesSucks” to the infamous viral videos showing officers forcibly dragging a doctor, screaming and bloody, from a Louisville-bound flight.

These videos and Tweets show a general dislike for the Company.

It’s not only about unhappy customers and bad publicity.

These incidents, feelings, and posts can severely affect a company’s bottom line. United Airlines’ market price dropped by $1.4 Billion following the incident.

There are many benefits to treating your customers with respect, care, and attention.

James Cash Penney was the founder of J.C. Penney. Stated that “courteous treatment makes a customer into a walking advertisement.”

Recognize Customer Retention as a Priority

As Hsieh mentioned, repeat customers can drive colossal growth.

Bain & Company conducted a study that found that a 5% improvement in customer retention could increase profits by 25%.

Repeat clients spend, on average, 67% more per customer than new customers. Plus, acquiring a new customer can cost between 5 and 25 times more than retaining existing ones.

Let’s look at a real-life example of how to use higher retention rates for your niche.

The higher your lifetime value of customers is, the longer you keep them.

This metric reveals the amount of profit each customer will contribute to an organization throughout their relationship.

You can now afford to spend more on acquiring new customers when you make more money per customer.

It’s awesome! And mainly if you use pay-per-click (PPC) ads on platforms such as YouTube, Facebook, Google, Instagram, etc.

PPC advertising is based on a system of bidding. The highest bidder will be awarded the opportunity to advertise.

This is the most incredible part…

You could purchase all their traffic if you bid more than your competitors.

Overall, good customer relationships increase your bottom line.

Customer relations is a remarkable differentiator

Zappos’ and Amazon’s success is partly attributed to their dedication to their customers.

They’re known for it.

When customer relations become more than just communication or service, they become the brand identity of a business.

Bezos defines branding as perfect: Your brand is what people say about you when you are absent.

Amazon is so trusted that many people sign up for an Amazon Key service. This service lets the delivery person enter your home and leave packages within.

Anthony Smith founded Insightly. He wrote in Forbes: “It’s ironic, but consumers are more likely to trust Amazon to enter their homes than their neighbors not to steal packages from their front porch.”

Here’s another example of the outdoor clothing and gear brand Patagonia.

Patagonia uses customer service to communicate its commitment to environmental sustainability consistently.

Patagonia launched an unlikely Cyber Monday advertising campaign. The full-page advertisement in The New York Times read: “Don’t Buy This Jacket.”

The advertisement explained that excessive consumption damaged our environment and overextended natural resources. It said, “We are doing the opposite of all other businesses today.” We ask that you buy less and think before buying this jacket or any other item.

This message resonated strongly with Patagonia’s target audience and helped them to differentiate themselves from their competitors.

How many businesses are more concerned with their core mission and less about sales?

Patagonia’s customers regard the Company as genuine, caring, and personable. Patagonia is now considered one of the most environmentally-conscious companies in the world, with revenues exceeding $209 million per year.

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