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How to Build Strong Customer Relationships

A customer retention expert reveals his surefire tips for success

April 29, 2008
Edited by: Ken Beaulieu in: Customer Retention Strategy

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Seth Godin is an infectious agent of change. With several books under his belt (most notably the best-sellers Permission Marketing and Purple Cow), a rigorous schedule of speaking engagements, and a shaman-esque wisdom about direct mail marketing and corporate innovation, he has been praised throughout the business world for spreading what some call the idea-virus. As the genius behind Yahoo!’s direct marketing, Godin says that being more strategic, more selective, and ultimately more polite in building customer relationships can save money and strengthen market position. FuelNet caught up with Godin to get his thoughts on how companies can secure success.

FuelNet: Where do you see most communication breakdowns occurring and what can companies do to build better customer relationships?

Godin: Relationships break down when companies get selfish, when they act as though they have a right to our attention, when they cut corners and when they break promises. Many companies imagine that they have a steady stream of new customers and an endless resource of non-customers just waiting to replace them. In fact, good customers are like oil reserves — we’re running out. Treasuring your customers — focusing on finding more things to do for them, instead of spending all your time looking for replacements — is a much smarter strategy. Every time a supermarket loses a single customer, for example, it loses $40,000 in lifetime revenue.

FuelNet: In your books, you often point to catalysts of conflict, between managers and employees, employees and customers. Please elaborate on the importance of civility and respect.

Godin: I think respect is the one thing that consumers want more than anything. Low prices are a distant second. Respect is what employees want too. Every poll I’ve ever seen places it right at the top. It seems to me that it would be cheap and easy to simply say please and I’m sorry and thank you more often and to assume that people [both the buying public and employees] are intelligent and honest. But too often, the opposite occurs. Retailers who do not operate by projecting respect are the norm, and some people will take abuse in exchange for low prices. In the future, when people with money realize the power they have, the marketers with respect will win.

FuelNet: Mass marketing transcends the commercial marketplace and has found its way into the nonprofit world. When a nonprofit comes to you, what do you tell them?

Godin: Direct marketing is broken. One major charity in New York spent 73 cents on every dollar raised through direct mail marketing. That’s lazy and wasteful and dishonest. The answer is to return to the old days, to market to people who want to be marketed to, to gain share of mind and share of wallet — not hitting up large numbers of people for a nickel.

Who wants to be marketed to? People who are obsessed or interested or in need, people who will benefit from your new product or service, people who feel good when they can tell their friends and colleagues about something new. These people are happy to volunteer and eager to pay attention.

FuelNet:  If there’s a single nugget of advice you’ve learned that all successful companies cannot live without, what is it?

Godin: Nobody cares about you. They don’t care about your marketing budget or your new products or your shareholders. They refuse to pay attention to your ads, no matter how often you run fancy commercials or send annoying spam. People have a choice, and more often than not, their choice is to ignore you. You can make something worth talking about or you can disappear.

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