An article by Christof Binder and Dominique M. Hanssens on Harvard Business Review provides further proof that Lovemarks are where it’s at when it comes to how and where to focus your business. They examined the value of brands and customer relationships – two key assets of any business – and found that over a decade, brand valuations declined by nearly half, while customer relationship values doubled.
This finding suggests a paradigm where businesses with strong customer relationships reign supreme over businesses with strong brands. The former comes with loyalty – often, beyond reason. It’s also helped by digital technologies that offer a direct link between businesses and customers, thereby improving efficiency and quality of interactions.
The lesson? I think we knew it all along. The lion’s share of effort for businesses should go towards reinforcing relationships in order to build a brand. Focus on the latter without integration with the former and you might end up with a strong brand, but it won’t necessarily keep your customers coming back.
- Build in layers – create a sense of belonging and connection through revelation, not explanation. Explore your brand to find resonances that your customers can uncover.
- Know what time it is – saying the right thing at the right time speaks volumes. Be there for your customers when they’re in need. Have a presence in their daily lives.
- Fan the flame – all relationships go through stages of familiarity. Communicate and reward your customers according to where they are in their relationship with you.
- Create strong ties – communities and urban tribes, online and offline, are an important part of modern life. Think of ways of how your brand can be inclusive to friends and family.
- Give to receive – successful relationships work both ways.