Terry Vavra's Blog

The ‘Dawn’ of Relationship Marketing – Really?

Posted on 18. Apr, 2012 by tvavra in Customer Relationships

Earlier this year, in its January 2, 2012 issue, Advertising Age, the venerable “voice” of Madison Avenue proclaimed that we are now at the “dawn of the relationship era”.     The magazine reports that while chief marketing officers have for the past five years ‘talked the talk’ of consumers taking control, that it is now truly time to “say goodbye to positioning, preemption and the unique selling proposition”.  Quite a statement from the industry mouth-piece that has shown its relationship-naiveté by frequently suggesting that mass media advertising can be an effective relationship-building tool!

But more basically, I’m perplexed for two additional reasons.  First, mainstream marketing was impacted in the early 1990’s with several books on relationship marketing, including my own, Aftermarketing - first published in 1992.  Today there are over 2,000 books on relationship marketing.  This collection suggests relationship marketing is not only beyond its “dawn” – but quite likely in its “mid-day”!  Second, I’m a huge believer in the value of relationship marketing because it builds positive word of mouth and stimulates referrals.  But, I also see many product categories in which the importance of advertising, product positioning, promotions, etc. remains critically important.

Think about it.  How often do most people strike up a conversation about or ask someone for a recommendation regarding categories like the following:

Toothpaste                                       Laundry Detergent                       Orange Juice

Breakfast Cereal                             Life Insurance                                Frozen Vegetables

Magazines                                        Furniture                                         Gasoline

Not Quite Time to Bury Traditional Marketing Tools

There are hundreds of product categories, generating billions of dollars of sales each year, which are either too private, too insignificant in price, or simply just not considered meaningful enough to prompt recommendation-giving or searching for endorsements.  Add the thousands of new products being brought to market each year that need to reach a critical mass of loyal customers – before referrals can really get under way – and you begin to recognize that advertising, promotional support, signage, couponing and many other forms of traditional marketing won’t be going away anytime soon.

New Ways to Communicate

On the other hand, would you consider staying at a hotel, booking a dinner reservation, or buying a car, a computer, or a smart phone today without tapping into private or public word of mouth?  Probably not.  Understanding this, Ad Age does make a creative suggestion.  It suggests that the traditional center of distributing marketing messages – the ad agency media department – has to be redefined.  No longer are the traditional media (TV, radio, magazines, and newspapers) the only way to spread word about one’s brand.  In the world of relationship marketing, it’s virtually “everything one does and delivers that carries the brand’s message forward”.  The challenge for agency media departments will be to adapt to impacting content on the newer social media.  And this will be foreign territory.  There aren’t any rate cards; there aren’t specific ad formats.  Success will be measured in the ability to seed and stimulate personal discussions about clients’ products and services.

This is where true relationship marketing has to come in.  But, as Ad Age has editorially dismissed the traditional tools of brand marketing (positioning, preemption and the unique selling proposition), it has failed to offer a replacement set of tools.  In fact, one of the troubling aspects of the whole relationship marketing ‘movement’ has been its very obvious lack of universally shared strategies.  Most practitioners, myself included, appear to have some processes in mind, but the marketing community has yet to agree on a core set.  So, while I believe it’s historically incorrect to characterize today’s marketplace as the “dawn of relationship marketing”, a good case could be made for today as the starting point for the development and sharing of a universal set of tools for relationship marketing.  I’ll have more to say about that in the future.

Tags: Customer Recognition, Customer Relationships, private word of mouth, public word of mouth