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Relationship Marketing As One Of The Best Ways To Increase Sales

By Ryan Pell

Relationship Marketing As One Of The Best Ways To Increase Sales
In e-commerce, dropshipping is slowly becoming one of the most effective supplies chain management methods. 

According to the stats by 3dcart
-    A large portion of e-commerce orders is fulfilled via dropshipping. For instance, in 2017, around 23% of e-commerce orders were fulfilled via dropshipping, which amounted in about $85 billion
-     Dropshipping is used by around 33% of online stores
-    As a supply chain management method, dropshipping is projected to grow by 17% every year

There are many marketing techniques that can be applied to dropshipping in e-commerce to boost sales. However, the best methodical approach that focuses not only on increasing sales but also on the effective communication between a retailer, a manufacturer, and a customer is relationship marketing. 
 

A Brief Intro to Relationship Marketing

Relationship marketing is a part of customer relationship management (known as CRM in the marketing world) that introduces techniques, aimed at developing customer loyalty and enlarging long-term customer engagement. 

Simply put, relationship marketing strategies work on creating a strong lasting relationship between a brand and a customer. 

Relationship marketing is an encompassing term that includes 3 main strategies (which you probably are already familiar with):
●    Referral marketing - encouraging loyal customers and brand advocates to refer people to your brand in a word-of-mouth manner. 
●    Affiliate marketing - inviting third-party brand advocates, through which a brand receives new customers (in exchange for commission). 
●    Influencer marketing - focuses on influencers with a lot of followers instead of small affiliates or existing customers. The main aim is reaching a bigger number of people, loyal to one influencer. 

All the above-mentioned strategies aim at improving the brand-customer relationship but have also proven to be effective when it comes to increasing sales.
 

Impact of Relationship Marketing on Sales

Relationship marketing strategies can be used also to strengthen relationships and improve cooperation between a retailer, a manufacturer, and a customer. These relationships greatly impact on the qualitative characteristics of this cooperation, here’s how:
●    A good connection between a retailer and a manufacturer influences the quality of the order/product. 
●    A strong relationship between a retailer and a manufacturer influences how well the order is fulfilled. 
●    As a result, a strong connection and good communication between a retailer and a manufacturer influence customer satisfaction, having a direct impact on sales. 

Martin Ferguson, a marketing manager at Flatfy, says that the impact of relationship marketing on dropshipping and sales is more visible if you present it in the form of a loop:

            

When the retailer-manufacturer relationship is optimized, it has a positive effect on customer satisfaction, which what relationship marketing deals in the first place. The better customer satisfaction is, the higher are the sales, as a result. 

Now, let’s take a look at some relationship marketing techniques that you can use to increase sales. 
 

1.    Customer Loyalty Programs

Customers respond very well to brands offering them customer loyalty programs. A survey, posted in the European Journal of Business and Management, covered restaurant customers, who were offered participation in loyalty programs. The majority of surveyed customers (over 80%) responded positively to this offer. 

The authors of the research suggested that these results aren’t necessarily exclusive to restaurants, and other B2C spheres can benefit from these programs, too. 

In marketing, it’s a well-known fact that a returning customer will pay more than a new customer. Customer loyalty programs contribute to customer retention, thus having a direct impact on sales. 

Thus, an effective customer loyalty program benefits both retailers and drop
 

2.    User-Generated Content 

Among the relationship marketing techniques to boost your sales, user-generated content (UGC) is definitely the most creative one. 

UGC should not be confused with a referral program (which is also one of the relationship marketing strategies), as you simply ask your loyal customers to provide you with content. In return, brands usually credit these customers and offer some kind of reward.

Integrating UGC positively influences customer loyalty, thus, helping you achieve one of the goals of relationship marketing. 

The best example of using UGC is NYX’s FACE Awards unboxing challenge. The winners of the challenge were flown to LA to attend FACE Awards and collect the prize. 

                                                               (Image credit: NYX )

As a result, NYX largely benefited from integrating UGC, experiencing an engagement boost and a substantial boost in sales. 
 

3.    Automating Retailer-Dropshipper Communication

You’d be surprised, but the most effective way to improve the retailer-dropshipper relationship is by automating their communication. 

The main issue that often occurs in this communication is that a retailer does not receive any on inventory and order status. Using dropshipping automation software allows you to eliminate human error and make sure that all the orders are processed correctly and delivered on time. 

When both you as a retailer and dropshippers have to deal with large numbers of orders, the possibility of making a mistake sufficiently increases.  By introducing dropshipping automation software, you make sure that you keep your customers happy as well as preserve a good relationship with your suppliers. 
 

In Conclusion

Relationship marketing is, without a doubt, one of the most effective strategies, as it focuses on building your e-commerce brand by strengthening the retailer-dropshipper-customer relationships, and, as a result, largely contributed to increasing sales. 
Hopefully, the above-mentioned tips helped you better understand, why and how you should use relationship marketing strategies to manage your communication with dropshippers, increase customer loyalty, and increase sales as a result. 

 


About the author

Ryan Pell

Ryan Pell is a passionate writer who likes sharing his thoughts and experience with the readers. Currently, he works as a sales manager, you can check his website here. He likes everything related to traveling and new countries.