Building a business that works like an old relational exchange model is possible today at scale. The relational exchange model is where the seller really knows the customer. Think Nordstrom vs Walmart. Nordstrom does its best to manage relational exchange models at scale. They did it without the benefit of much technology. So does the local store you shop at all the time. They know you. Maybe.
A long time ago, relational exchanges allowed buyer to seller exchanges to work well. The baker knew what you would buy. They could ‘predict’ sales based on who you are and some idea of past purchase history. Over time, they would get better at predicting you. Certainly buying bread every week does not predict the fancy cake. Subtitle hints could indicate a chance to sell that cake. The big assumption is going way back to when this type of exchange mattered. Your favorite coffee shop barista might know you but the minute you go to a new city, the far-away coffee shop has no idea who you are – even if it is Starbucks, who has a CRM.
For most companies, the only data sources to understand customers today are overcooked ‘data of the past’ methods. It is rare to find look ahead data built into a CRM or marketing plan. For the most part, it’s like getting socks for every birthday because you opened the box last year.
When you market this way, you are doing “one way to many”. It is a transactional exchange with very limited outcomes. Buy a printer, they recommend ink, buy a camera, they recommend a lens cap. Instead of guessing, maybe they could find other things that predict you want to go to Paris.
Due to growing cost and limitations of digital marketing and the lack of consumption of traditional marketing, brands must look to other things, like CRM, to grow revenue. The really good news is 2018 holds promise to inject relational exchange models into a CRM and entire business at scale without costly media budgets.
The downside is you must do things differently, but that’s where we come on. Let’s see how we can help you.