This is part four of a series on how to figure out what type of marketing your small business needs, focusing on five different dimensions: Demand, Trust, Relationships, Competition, and Sources. If you just subscribed, read the first edition here.
Do people typically buy from you once in their lifetime? Can they buy often? Somewhere in between?
Like with demand and trust, customer relationships exist on a spectrum.
Wedding venues, estate attorneys, moving companies, etc., rarely sell to the same person twice. Gyms, salons, landscapers, etc., rely on recurring sales.
Identifying where you are - or where you want to be - helps clarify many strategic questions.
For one: what should you spend on marketing?
If you’re offering a recurring service, the relationship can last much longer than the first transaction. A gym member at $60 a month for three years is worth more than $2,000. Even if you spend $120 to get a new member, their lifetime value greatly outweighs the upfront cost.
It also helps answer how much to focus on acquisition vs. retention.
Many businesses that could get repeat customers spend on advertising to acquire new customers, but don’t invest in basics like email marketing to keep people coming back.
On the flip side, lots of one-time businesses waste time on retention tactics, often just copying another business they like, not realizing they have a completely different relationship model.
Furthermore, viewing this relationship as a marketing dimension helps you think about important activities that aren’t typically defined as marketing.
For instance, the HVAC company whose technicians show up on time, looking professional, wearing shoe covers, being patient, not being pitchy, thoroughly cleaning afterward, then performing a courtesy follow-up. We call this customer service, but if it leads to a referral or review that gets another customer, it should be part of the marketing plan.
Even further, it can get you thinking creatively about ways to form a tighter bond with customers. Adding new products or services - custom merch, loyalty programs, etc. - can be a key to unlocking more lucrative relationships.
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