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How Relationship Marketing can help your business during bad economic times

Can a bad economy put a dent in your sales? Sara, a colleague of mine, thought so as she watched her sales decline during the last six months. Like most of us, Sara has heard the news reports suggesting that we are in a recession. She wondered if the reason her sales are down is the bad economy. I asked if she had recently cut back on her advertising and marketing.

"Yes, I am pulling in the purse strings and limiting my expenses," Sara replied.

I asked if she was meeting new people and developing relationships.

"No," she admitted.

This could be part of the problem. History has shown us that businesses often reduce—or completely stop—the dollars spent on marketing and advertising during economic slowdowns.

The economy may have something to do with fewer people spending money, but there is nothing we can do about the plight of the economy. What we can do is practice relationship marketing with people in our sphere of influence to increase our own business sales.

Joe Girard was listed in The Guinness Book of World Records as the "World's Greatest Retail Salesman" for twelve consecutive years. Joe was not born with a silver spoon in his mouth. Joe was abused by his father as a child, lost jobs as an adult, and then went bankrupt. He finally landed a job at a Chevrolet dealership. Joe did very well, personally selling more cars than most dealerships! In fact, people stood in line to buy a car from Joe. What was his secret?

Joe practiced relationship marketing. Here's how he did it. He sent 13 handwritten cards to each of his clients and prospects every year: one card a month and one on Christmas. These cards were cards of appreciation, tips, and giveaways—never about special sales, discounts, or promotions. During his 15 years, Joe sent 13,000 handwritten cards! Every one of his recipients began to anticipate a card from Joe every month and he was the first person on their mind when they were ready to buy a car.

What can we learn from this story and how can we expand upon it? Here are a few strategic objectives we can put in place now, so our businesses can better withstand the impact of economic downswings.

Develop strong relationships.

People do business with people they know, like and trust. It's our job to make this connection happen. To do that, we must go beyond the superficial and become genuinely interested in our customers and prospects. For instance, we can meet clients at a coffee shop and get to know them personally, without the usual business discussions. I often do that. I make mental notes on what is going on in their lives, so I can refer to it the next time we connect. Then I nurture my relationships by consistently staying in touch.

Consistency is the key.

We can stay connected with our contacts by sending heartfelt cards like Joe did, or by phone calls, emails or newsletters. We lose 10% of our influence every month we do not have contact with our clients. And just a 5% increase in customer loyalty could add 20-80% to your bottom line. A disappointing statistic shows that 91% of all real estate agents are forgotten by clients within one or two years after they close or represent a buyer on a home because they did not stay in touch with them.

Form a strategic objective to stay in touch.

Here are a few ideas. Try one on for size. Set up campaign postcards to go out once a month. Find or develop a system for remembering birthdays. For those in real estate, record closing dates and send anniversary cards. Veterinarians can record the birthdays of client's pets and send birthday cards.

I personally use an on-line service that has a phenomenal system for managing my contacts, as well as printing and mailing postcards and greeting cards. I customize and personalize the cards with my own handwriting font, signature and photos. I have found that a simple and sincere card can make a huge impression on someone, especially if they are having a bad day. Sometimes I include a gift card or small gift of teas or sweets with a thank you card.

Understand and use the Law of Attraction.

When we express appreciation, recognition or encouragement, we are focused on giving and abundance, not scarcity. Every human being wants to feel acknowledged, loved and appreciated. When we send love and thanks out into the world, we get it back tenfold. What we focus on expands, so if we are focused on our lack of money, we will continue to have a lack of money. This is the Law of Attraction. We can inspire ourselves by feeling and visualizing what we now want in our lives. It helps to begin the day by meditating, listening to beautiful music, taking a walk, or calling someone with whom we have had good business results. The popular book and independent grassroots movie, The Secret, shows how to apply this law to achieve anything we want in our personal and business lives.

Kody Bateman, a mentor and colleague of mine said, "Appreciation wins over self promotion every time." That sums it up beautifully.

Use the Rule of 250 to build a referral network.

As small business owners and entrepreneurs, we each know at least 250 people. Some of us know many more than that. Each one of those 250 knows another 250, and so on. See where this is going? When we make a commitment to stay in touch with people we know—and remember they each have hundreds of contacts—we have the potential to reach thousands. Additionally, we can build our networks by joining local and online business networking groups. Referred customers are usually already sold on us through the testimonial of the person who referred us. Did you know that in occupations such as real estate, as much as 90% of the business comes from relationships or referrals?

When we build strong networks and nurture meaningful relationships with the people we serve, we will garner unlimited referrals and be less affected by economic down cycles. Start making relationship marketing part of your business today and watch your business grow.

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