A Study in Opposites: Transactional vs. Relationship Marketing
Upon walking into any store worth its salt, you're going to be greeted by an employee, probably asked by another employee if you need help, maybe be assisted to the register, and checked out while having a friendly chat with the cashier. By the time you've left the store you've potentially developed a relationship with several people. Similar scenarios can play out on social media or over the customer service phone line.
These sort of scenarios don't necessarily play out in the online world of shopping carts and credit card payment forms.
What is Transactional Marketing?
At its core transactional marketing is just that, transactional. Its total focus is on the point of sale (POS), the moment when a customer is actually charged for the item. In and out: Find the right product, click the purchase button, hand over payment info and be done with it.
In many ways, our fast-paced society appreciates a simple transaction. Not everyone has time for a two-way interaction. With more and more people purchasing products from their phones, the ease and fluidity of a one-click transaction is especially preferred.
The process by which we buy things is getting faster, more secure. Transactional marketing has dwindled down from a several-step checkout to just a few clicks. Many companies store information like address, payment options, even garment size or receipt preferences. For time-pressed consumers, the appeal of not having to re-enter all of this information for each purchase is gold.
But does all this speed come at a cost? After cutting out some of the lengthy relationship hoops, many transaction-based companies still look toward other ways to keep customers coming back to purchase additional products.
Personalized extras like thank you cards and checkout-reminder emails help keep customers coming back. This sort of correspondence can partially bridge the relationship gap by keeping a company top of mind with "Hey, you have still have a full shopping cart" reminders or feel-good thank-yous. Essentially, these methods make transactions not seem so transactional.
What is Relationship Marketing?
What's the key to any good relationship? Trust. To create the perfect pair for relationship marketing, it takes a level of personal commitment on the part of the salesperson, and a level of trust from the customer.
Customers enter into a marketing relationship because they expect to receive positive value from the participation. Relationships have the potential to provide customers with in-depth information about products and services, help finding the best fit, and assistance with scheduling, discounts and other issues that can't always be taken care of in an online checkout setting. But most of all, a good relationship helps customers feel confident about their purchasing decision - and a confident customer is more likely to return.
Loyalty varies by industry. The pinnacle of loyalty occurs when a customer resists the influence of other brands. Research indicates loyal customers are more profitable for a business in the long run; they are usually willing to pay more for brands of choice and they offer the most valuable kind of marketing: word-of-mouth.
Two to Tango
Transaction-only and relationship-only marketing both have their place for the right products or companies. For most of us, though, the key to a successful campaign is an equal blend of the two. Create lasting relationships with customers in person or on social media in a way that transforms them into loyal brand ambassadors. But at the same time, make sure all roads lead to the purchase button, and don't force a relationship on a customer who just wants to get in and get out. Making a transaction simple doesn't mean you lose loyalty, and making a transaction engaging doesn't mean you lose time.