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One Customer Relationship Style Does Not Fit All

One Customer Relationship Style Does Not Fit All

Price and satisfaction in the product still dominate the customer's view of the seller, but a third of them are seeking a greater connection. This third is why it is critical for businesses to refrain from defining their relationships in a monolithic fashion: Every customer views business relationships in individual terms. The business can't define it any longer -- if it could, we'd buy everything out of vending machines.

By Christopher J. Bucholtz CRM Buyer ECT News Network
03/01/12 5:00 AM PT

In this era of social media, the Dunbar Number has been the subject of considerable debate. For those of you who don't run in evolutionary anthropology circles, the Dunbar Number is a concept created by Robin Dunbar, the director of the Institute of Cognitive and Evolutionary Anthropology at Oxford University. Dunbar's theory is that there are only so many meaningful relationships we can manage -- the approximate number is 150.

"Meaningful" in Dunbar's parlance is defined as having a relationship that involves trust and obligation. There's some debate over whether social media can help increase the number from 150 by helping people automate aspects of having these kinds of relationships -- or whether any kind of automation negates aspects of deep relationships.

It's an interesting question -- and if you're a CRM practitioner, it should make you consider what the "R" in the acronym really means. How do you define relationships with your customers -- and do you have just a single definition of what a relationship really is?

Customers Want Connection

Mitch Lieberman, a noted blogger and vice president of marketing at Sword Ciboodle, has a mantra: "Customers do not want a relationship with your business. They want the benefits a relationship can offer to them."

I agree with Mitch on this, to a point: The vast majority of companies you do business with are valued purely on the results and qualities of transactions. Did the customer get what he wanted or needed, and was the process of getting that frictionless -- and, perhaps, a little enjoyable? If the answer to both questions is yes, then the "relationship" is a good one from the customer's perspective.

To bolster that point of view, Mitch presented the results of a 2010 study by the IBM Institute for Business Value that ranked customers' and businesses' perceptions of social media. The customers were asked the reasons they interacted with companies online, and businesses were asked why they thought customers followed them via social sites.

Customers said they followed businesses first for discounts and second for purchases. While these things topped the rankings for customers, they were at the very bottom of the perceived reasons for businesses, indicating a failure in perception from businesses about what most customers expected from their buyer-seller relationships.

However, the same study also included another interesting number: Thirty-three percent of the customers said they interacted with businesses online to feel connected.

Customer Relationship Segmentation

While price and satisfaction in the product still dominate the customer's view of the seller, a third of them are seeking a greater connection. This third is why it is critical for businesses to refrain from defining their relationships in a monolithic fashion: Every customer views business relationships in individual terms. The business can't define it any longer -- if that's the way it worked, we'd buy everything out of vending machines.

Instead, businesses need to realize that they are building different types of relationships with different sorts of customers. Each customer may be unique. However, it is possible to segment customers according to the relationships their behaviors indicate they desire -- and then attempt to craft communications and experiences that mesh with their expressed relationship style.

Marketers have been doing such segmentation for years, and the tools and concepts are already there. Now, the opportunity is there to develop strategies to meet the customers' relationship needs in more fully realized ways.

Hierarchy of Needs

Many want to buy and fly -- their relationship will be strictly business. Some will have a collaborative bent that you can foster for the benefit of both sides of the relationship. Some will be fans eager to see what you'll be doing next.

Customers' behavior will describe a hierarchy of relationship needs; how far up that hierarchy they travel will depend on what vision of the relationship they hold. In most cases, the farther up the hierarchy they move, the more valuable they will be as customers and influencers of other customers.

However, the foundation of that hierarchy -- the basic product satisfaction and value component -- must be met in order for you to capitalize on the desire of customers for a deeper relationship. Fail at that, and customers will redefine relationship once again -- by excluding you in favor of another seller.

The relationships that are higher on this hierarchy are unlikely to boost anyone's Dunbar Number, but they may end up boosting your bottom-line numbers -- if you avoid falling into the trap of thinking that all customer relationships are the same.


CRM Buyer columnist Chris Bucholtz blogs about CRM at the CRM Outsiders. He has been a technology journalist for 17 years and has immersed himself in the world of CRM since 2006. When he's not wearing his business and technology geek hat, he's wearing his airplane geek hat; he's written three books on World War II aviation.


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