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7 Common Misconceptions about Customer Relationships

Steve ManattAugust 11, 2014

You’re bursting at the seams with CRM data, you’ve invested in a killer CRM database, and you have a CRM manager who hails from a fancy, famous brand. You’re ready to go, right?!? Well, maybe. There are some common misconceptions that might be lurking around the corner, ready to thwart your efforts. Read on to make sure you’re keeping the “relationship” front and center in your CRM!

Misconception #1: Algorithms are smarter than people.

Algorithms are developed by people, so how could they be superior? At the end of the day, algorithms are written for one goal or another – and up to now, most marketing algorithms have been written based on economic data. This means many are not optimized to capture relationship data or signals to inform a marketing strategy. Result? Marketers might miss an important signal on how a customer or prospect wants to be treated – and may not have the opportunity to pick up that signal a second time.

Misconception #2: Customers all want the same things.

The recent article Unlock the Mysteries of your Customer Relationships highlighted many different types of relationships consumers can have with brands. Is your relationship a “secret affair,” is it more “love hate,” or are you “old friends?” Each relationship type has difference rules of engagement and it’s up to us marketers to know what they are. Technology has enabled one to one engagement so now it’s time make personalized marketing a reality!

Misconception #3: Marketing owns all aspects of the customer relationship.

When a customer reaches out to a call center for support, chances are a marketer doesn’t answer the phone! What if you offer a highly technical product with configurable product features and GUIs? Most likely marketing had some input, but certainly didn’t build the product. If relationships truly are a focus for a company, there must be training across the board to educate and instill those relationship-building considerations in everyone at the company. After all, we’re all client-facing in some form!

Misconception #4: The customer dictates all the rules of the relationship.

How one-sided would that be! Just like with people, customer/brand relationships change and evolve with time and experience. As a company, are there certain types of relationships we want to cultivate with our customers? If so, what actions do we need to take to make that happen? Likewise, as a consumer, how do we feel when brands don’t engage with us in a way we find valuable? (can you say “unsubscribe?”)

Misconception #5: Offering money to repair a broken relationship works wonders.

If we acknowledge that there are different types of customer/brand relationships, then it stands to reason that there are different goals for each of those. This means free product or a gift card isn’t always the answer. When there’s a problem, what caused it? Is there a process that needs to be fixed or an internal group that needs to be trained? Some customers will appreciate that much more than money back.

Misconception #6: Long-term, loyal customers are always the most profitable.

Premise: there’s no question that long-term, loyal customers are the lifeblood for many companies. There’s also no question that every company wants more of them! But let’s step back a moment –  when was the last time you let a friend go hungry at lunch because they forgot their wallet? Or you charged your best friend high interest on a loan? Every industry is unique and every company even more, so it’s important to understand when you can charge a premium, and what types of relationships are simply keeping the lights on. Loyal doesn’t always equal profitable.

Misconception #7: Brands really only need to focus on the positive relationships they have with customers.

Wrapping marketing’s arms around customer relationships means starting with your current customers to uncover the relationship profiles already present. Once you’ve done that, you might discover there are some customers who don’t love you as much as you’d like. (shocking!) Here’s the good news – that doesn’t mean you have to write off all opportunities with them. What actions can you take to move them in a more positive place? It can be done!

Now, fellow myth-buster, go unleash your intrepid CRM manager! These are the days that great relationships can be built and improved upon!