relationship marketing

Contributor(s): Dennis Shaio, Laura Aberle

Relationship marketing is a facet of customer relationship management (CRM) that focuses on customer loyalty and long-term customer engagement rather than shorter-term goals like customer acquisition and individual sales. The goal of relationship marketing (or customer relationship marketing) is to create strong, even emotional, customer connections to a brand that can lead to ongoing business, free word-of-mouth promotion and information from customers that can generate leads.

Relationship marketing stands in contrast to the more traditional transactional marketing approach, which focuses on increasing the number of individual sales. In the transactional model, the return on customer acquisition cost may be insufficient. A customer may be convinced to select that brand one time, but without a strong relationship marketing strategy, the customer may not come back to that brand in the future. While organizations combine elements of both relationship and transactional marketing, customer relationship marketing is starting to play a more important role for many companies.

relationship marketing elements
Effective relationship marketing involves a variety of overlapping strategies and technologies that help foster a deeper, long-term relationship with current and prospective customers.

Importance of relationship marketing

Acquiring new customers can be challenging and costly. Relationship marketing helps retain customers over the long term, which results in customer loyalty rather than customers purchase once or infrequently.

Relationship marketing is important for its ability to stay in close contact with customers. By understanding how customers use a brand’s products and services and observing additional unmet needs, brands can create new features and offerings to meet those needs, further strengthening the relationship.

Implementing a relationship marketing strategy

Relationship marketing is based on the tenets of customer experience management (CEM), which focuses on improving customer interactions to foster better brand loyalty. While these interactions can still occur in person or over the phone, much of relationship marketing and CEM has taken to the Web.

With the abundance of information on the Web and flourishing use of social media, most consumers expect to have easy, tailored access to details about a brand and even expect the opportunity to influence products and services via social media posts and online reviews. Today, relationship marketing involves creating easy two-way communication between customers and the business, tracking customer activities and providing tailored information to customers based on those activities.

For example, an e-commerce site might track a customer's activity by allowing them to create a user profile so that their information is conveniently saved for future visits, and so that the site can push more tailored information to them next time. Site visitors might also be able to sign in through Facebook or another social media channel, allowing them a simpler user experience and automatically connecting them to the brand's social media presence.

This is where CRM and marketing automation software can support a relationship marketing strategy by making it easier to record, track and act on customer information. Social CRM tools go further by helping to extend relationship marketing into the social media sphere, allowing companies to more easily monitor and respond to customer issues on social media channels, which in turn helps maintain a better brand image.

Benefits of relationship marketing

Benefits of relationship marketing include:

  • Higher customer lifetime value (CLV). Relationship marketing creates loyal customers, which leads to repeat purchases and a higher CLV. In addition, loyal customers are likely to become brand advocates or ambassadors, recommending products and services to friends, family and business associates.
  • Reduction in marketing and advertising spend. Spending on marketing and advertising to acquire new customers can be expensive. Relationship marketing causes customers to do the marketing for a brand, in what’s called buzz marketing. Customers tell others about a brand’s products and services, which can drive sales. Brands with exceptional relationship marketing programs spend little to no money on marketing or advertising.
  • Stronger organizational alignment around the customer. Organizations that emphasize relationship marketing have a stronger organizational alignment around an exceptional customer experience. The teams work together to create satisfied and happy customers over the long term.

Examples of relationship marketing

There are several types of activities brands can use to facilitate relationship marketing, including:

  • Provide exceptional customer service, as customers who are consistently impressed by a brand’s customer service are more likely to remain loyal to the brand.
  • Thank customers through a social media post or with a surprise gift card.
  • Solicit customer feedback through surveys, polls and phone calls, which can create a positive impression that customer opinions are valued and help to create better products and services.
  • Launch a loyalty program that rewards customers for their continued patronage.
  • Hold customer events to connect with customers and build a community.
  • Create customer advocacy or brand advocacy programs to reward customers who provide word-of-mouth advertising on a brand’s behalf.
  • Offer discounts or bonuses to long-time or repeat customers.
This was last updated in July 2019

Next Steps

How to use CRM as part of your customer engagement strategy

Continue Reading About relationship marketing

Dig Deeper on Customer loyalty and retention

Join the conversation


Send me notifications when other members comment.

Please create a username to comment.

Relationship marketing is a great example.. for marketing concept..
I think there's no doubt that relationship marketing is the way of the future - building sustained engagement is going to be more beneficial in the long run than going from sale to sale. There are plenty of statistics out there to show that it's much more expensive to obtain a new customer than to retain an existing one. 
What's more important today: relationship marketing or transactional marketing?
Absolutely Relationship Marketing. Transactions are a one-time deal. Relationships can last forever. Focusing on the long-term customer relationship will drive lasting loyalty.
I'll believe that transactional marketing is losing importance when Black Friday/ Cyber Monday sales are a distant memory. Relationship-building in the form of content marketing and improved customer service is gaining importance in industries once ruled by price and promotion alone, but transactional marketing is still of primary importance for plenty of apps and old school retailers alike. 
Like the others who responded here, I lean heavily, maybe totally, toward relationship marketing. One-ups are always nice, but they're not the heart of any business. Business growth depends on repeat customers, on relationships. Skip focusing on relationship marketing and your business is forced to start over again every day, one transaction at a time.
Build the relationship and the transactions will follow. It's not Einstein who said it, but it might as well have been. This formula works, so follow it.
Just like someone said, transactional marketing is one off thing. But it takes relationship to make the customer wants to keep doing transaction with you and that in its on way defines the LIFE TIME VALUE of a customer.
Relationship-marketing has been key to our Hyper Local marketing campaigns with the use of community liaisons, as an internet service provider to rural markets we have to build relationships with the market we serve. Without local presence of a store to sell our services we can build key relationships and market to those that are in need of our service with a relationship with the market. 
thumbs up for relationship marketing.due to intense competition in the business world of today ,customers are to be treated with due care and the passport to win their loyalty and trust is to engage in relationships with them.
No doubt in my mind that relationship marketing is the future. You will want to build relationships with your client and get payments on a recurring basis. In transactional marketing, it's more about ROI, which is also important but since it's a one time thing, not a viable model.
Hi Margaret, 
Well it depends on the type of customer base and the type of business services they require. If the customer wants a one-time touch-and-go type solution as a temporary fix, then transactional marketing is the way to go. But I think relationship marketing plays a better role not just fulfilling the exact need of the customer but also knows what the customer expect in the future by making predictive analysis and tracking customer service activities. So yeah, relationship marketing is the preferred approach to buttress that bond.
Relationship marketing is the wave of the future.  With the social media experience, people can sell anything, but a story and relatable content buys more lives.  Tell your story, engage, embrace, retain.

Weslie Joe is my name, i quickly want to let the entire world know how i became a millionaire with the help of Illuminati. I was born into a very poor family that we had to eat just once per day at a time i did street hawking just to survive it continued like that until i grew up to 20 years old. it continued and then i started selling drugs it happened that i delivered a parcel to a very wealthy man who uses Royce Rolls i was so surprised when he said i should give him a call later in the evening that he have a thing to discuss with me. i did called him and he invited me to his office at Adams Street in Texas when i went to his office in the evening he asked me if i really want to enjoy this life i said yes then he said i should go home and meet him up in 5 days time we took some drinks together before i left. when i got home i was restless because of the question he asked me if 'i want to enjoy this life' i went back to him on the 5ft day as agreed then he said i shouldn't tell anyone that he wants me to join them in the Illuminati so that i can become very rich and wealthy. i was initially afraid to join because i thought it was for the Elites but he made me understand that even the poor can join and i was very amazed. so i was introduced, initiated online and i was given a benefit funds of $2,000,000.00 a car of my choice and also a house in Boston. Brothers and sisters, today i am made, today i am a millionaire and today i have my protection. please application form is open now and i want all of you to take this medium to become a member and become a millionaire and enjoy your life the way you want it. To become a member, you can email the initiation center directly on you can also call/text the initiation center on +1(917) 791-0923 if you uses WhatsApp, you can WhatsApp the initiation center on +1(617) 663-8926. PLEASE NOTE THAT IT IS TOTALLY FREE OF CHARGE TO JOIN AS NO ONE WILL ASK YOU FOR A PENNY TO BECOME A MEMBER. You are all welcomed.
Brother Weslie Joe
Membership number IGF/66689162