get a little closer

Relationship marketing." Nope, sorry folks: The concept has nothing to do with a fantasized tryst with that new person in the public relations department. Rather, it refers to something that should command much more of your attention: Money.



Got your attention now? Thought so. Relationship marketing is also known as "customer profiling"—a helpful term.

Consider the following scenario: A potential customer walks into your store. He or she decides to buy something. In turn, you want the customer to come back. That's the rub, mate: How, exactly, do you do this?

There are numerous strategies being played out at various stores today, fueled by a growing breed of consultants who stress the necessity of fine-tuning your marketing program. In today's brutally competitive retail arena, it's a matter of survival. You simply can't sit back and expect sales to take off. You need to learn more about your customers, and give them a reason to keep coming back to your store.

"Customer profiling has become the marketing technique du jour," says Riley Kirby, president of Interactive Marketing and Research in Charlotte, N.C. The concept isn't new. Large computer companies like Dell and Gateway have been amassing huge databases that track the tastes and spending habits of their customers for years. These mammoth companies have perfected the art of fine-tuning their marketing strategies to core customers.

But recently, even the little guys have gotten into the game. And, as is the case with many things these days, the reason is computers, with their reams of information about consumers being amassed and zapped around the electronic ether.

Say you're an outdoor retailer in the Pacific Northwest. You want to sell climbing equipment to Seattle-area climbers. Instead of taking out an advertisement in the local newspaper, or blasting the city willy-nilly with a mass-mailer, you can contact a marketing specialist company like Claritas (www.claritas.com), which is in the business of collecting information about consumers, including their ages and incomes, hobbies and shopping habits, by region. Claritas then sells that information. After arming yourself with a list of prospective customers in a specific market, you then can send a mailer just to the people you want—a much more efficient use of your marketing dollars.

There are numerous types of database software on the market that allow you to collect and store information about your target customers, and then regularly stay in touch with them. You can get this information yourself by having first-time customers fill out forms, or you can ask them if it's OK to send them materials.

Think of a customer as someone with whom you want to develop a warm and fuzzy relationship, not just as someone whose money you want in your cash register.

"It's the stores that provide 'high-touch,' relationship-building stuff that keep customers close," says Georganne Bender, a marketing consultant based in Saint Charles, Ill. She and partner Rich Kizer provide professional training to retailers and service companies.

Bender points to studies that show it can cost five times as much to attract a new customer than it costs to keep existing customers returning to your store. You can keep them coming back by appealing to their specific interests and needs, says Bender. And with today's ever-advancing computers and point-of-sale systems, compiling detailed information about the people who shop in your store is easy.

For small retailers who don't want to shell out a lot of money to hire a marketing consultant or buy information from a company like Claritas, producing a newsletter and sending it out to regular customers is an excellent and relatively inexpensive way to strengthen the bond between store and customer.

"Every retailer should weigh the cost of engaging in customer profiling against whether they can afford it," says Kirby. "But compared to advertising in a newspaper, it's fairly inexpensive."

Bender recalled the time when she and Kizer were invited to an event at a local art gallery. The event specifically was held to target businesspeople with small office spaces. As Bender chatted with the guests, she said she was amazed to find that the entire crowd consisted of people with businesses about the same size as hers. And all the guests had purchased art at the gallery at least once during the past year.

Curious, Bender asked the gallery owner how he developed his marketing technique. He said he regularly holds special programs each targeted to his different customer segments. So that's what customer profiling is all about.

For a broad view of demographics in your trade area, Bender suggests getting information from the U.S. Census Bureau, most libraries, your local chamber of commerce and the Internet. Things you should be looking for include median income, disposable income, education, home values, and the number of renters vs. home owners.

"Demographic information is important to know, but these days it's not enough,'' says Bender. "Customers want to be important to you as individuals. Customer profiling lets you get to know them on a one-to-one basis, or, at least, makes it appear that way.''