The Rise of the Relationship Era

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Author photo: Morgan Norman

Morgan Norman

In 2017, subscription businesses grew 8x faster than the old guard of S&P 500 companies.

This latest generation of startups has harnessed the power of data enrichment, automation and AI, and used it to build customer relationships that are longer and stronger than any that have come before.

To succeed in this new Relationship Era, companies need to follow the example set by breakout companies like Zendesk, Airbnb, Virgin America (RIP) and Spotify, focusing their energy on a single guiding principle: great customer relationships are no longer a nice-to-have—they're essential to sustainable growth.

The Evolution of Customer Relationships

The biggest success stories of the 20th century were the companies that built the strongest brand relationships. The likes of Apple, Disney, Nike and Coca-Cola were expert brand builders, crafting emotive, often polarizing stories that became part and parcel of their customers' own identities. Instead of cultivating loyalty to a single product, their customers became loyal to the brand, buying products because they believed in the company's vision more than the products themselves.

But today's breakout companies have taken relationship building to a new level. Instead of connecting with their customers through the broad brushstrokes of brand marketing, companies like Box, Zendesk and Nest are using technology to build intimate, personal relationships with every customer. These relationships have fueled each company to new heights, disrupting entire industries virtually overnight.

At the heart of these success stories were three big shifts:

  • The subscription model creates a financial incentive for long-lasting customer relationships: the longer you maintain a relationship, the more revenue your company generates.
  • Automation and AI provide the tools necessary to manage one-on-one relationships at scale, stripping out manual data entry and wasted time.
  • Widespread competition3.17 startups are created each second and, in the face of so much competition, exceptional customer experiences are a major differentiator.

The Relationship Era

As a result of these shifts, every industry—whether B2B or B2C—is dominated by the handful of companies that have been able to build these intimate customer relationships:

  • Travel → Airbnb, HotelTonight, Starwood Hotels
  • Entertainment → Spotify, Netflix, Hulu
  • Services → Amazon, Whole Foods
  • Consumer Goods → Nike, Zappos
  • Transport → Tesla, Lyft, Peugeot
  • Tech → Zendesk, Clearbit, Square, Ring

These relationship companies have fundamentally changed the way companies relate to their customers. Now, we're living in a new Relationship Era, where intimate customer relationships and deeply personalized customer experiences are no longer a nice-to-have: they're the de facto way of doing business and the bare minimum required to meet customer expectations.

To succeed in the Relationship Era, companies need to learn lessons from the stellar success stories of the past decade and harness the four principles these breakout companies have used to drive their incredible growth trajectories.

1. Everyone is a Relationship Maker

The modern customer journey is longer and more complex than ever before, spanning blog posts, demos, free trials, sales conversations and support tickets. As a result, the customer relationship is no longer siloed to a single part of the company: everyone, from sellers to developers, has a direct influence on the customer relationship.

Video-platform Wistia understands the importance of real, human connection throughout the customer journey.

Wistia's sales team doesn't just limit their customer involvement to sales calls—they also share their insights through freely available blog posts and video resources.

Every member of their team directly contributes to the customer experience:

  • Cold emails are personalized with short video snippets, called “video voicemails.”
  • Sales, operations and support teams share their expertise through helpful blog posts and video resources.
  • Even the company's CEO shares honest, open accounts about the team's culture and beliefs.

Every interaction with the company, whether you're a brand-new prospect or a long-term customer, is guided by the helping hand of a real human, from Shannon the sales adviser to Chris the CEO.

The relationships Wistia builds extend deeper than the brand level: every customer is making a genuine, human connection at every stage of the sales process. That means that every purchase decision—from a first-time purchase to the tenth renewal—is motivated as much by trust and friendship as it is by price and functionality.

2. Modern Software Builds Stronger Relationships

The tools you use can either help or hinder your relationships. CRM software is a perfect example: the first iterations of CRM were designed for deal management and functioned as simple databases containing records of every sale.

evolution of crm timeline graph

The purpose of CRM has been evolving, from the order management tools of the 1980s, to today's relationship-centric CRMs.

Today, some CRM systems—like Salesforce—still toe this line. They're great for recording deal data but powerless to capture insights from the myriad other interactions that occur between the customer and the business: phone calls, face-to-face meetings, social media messages, live chat conversations, support requests, and so on.

The latest generation of sales tools is designed to fit seamlessly into these conversations, whether it's Copper for CRM, Intercom for live chat or Mention for social media monitoring. Instead of relying on a clunky, all-in-one suite, relationship-centric companies are building best-in-class toolstacks to capture every customer interaction—no matter where it happens.

When it comes time for a sales call, this extra insight is the difference between success and failure; between offering timely, contextual advice or sticking to the same tired sales script; between sharing a helpful, relevant sales deck or sending the same presentation that the prospect read a month ago.

3. Create Customer Experiences That Delight

In the Relationship Era, consumers have more choice than ever before and, thanks to the popularity of month-to-month contracts and free trials, there are no barriers to ditching a vendor that doesn't live up to expectations. In this new world, “good” customer experiences aren't good enough: every interaction with your business needs to delight.

This expectation spans your entire business. Many of today's business tools—think Slack and G Suite—have user interfaces that are simpler and more intuitive to use than most consumer products. Now, consumers expect their products and services to just work, without complex setup or configuration.

The same applies to customer support. Airbnb—one of the front-runners of the Relationship Era—monitors every communication channel at its disposal—email, support, social media—looking for opportunities to proactively solve its customers' problems.

Many of these conversations are between guests and property owners, with no need for Airbnb's support teams to get involved. This was the case when a property owner shared their difficulties sourcing a stroller for their upcoming guests; but instead of leaving the owner to their own devices, the company chose to intervene and deliver a stroller straight to their apartment.

There are hundreds of ways to book a holiday property—through hotels, lettings agencies or even Airbnb's competitors. Much of the experience at these companies is comparable: you pick a property, place a deposit and turn up. But by seeking out opportunities to proactively help owners and guests, Airbnb set itself apart from its rivals. Though it costs the company in manpower and cash, its efforts pay dividends in gratitude, long-term loyalty and future purchases.

4. Personalize Every Product Experience

Companies like Clearbit and Spotify are experts at personalizing the customer experience, from your first website visit to your hundredth app login. By collecting data from multiple sources, every interaction is geared towards your individual needs:

  • Data enrichment services automatically reveal detailed demographic data.
  • Behavioral analytics provide insights into how people interact with your website and products.
  • Customer surveys provide qualitative feedback on every product experience.

For example, Clearbit uses information about a customer's industry and job title to trigger personalized onboarding emails, steering users to the features they'll get the most value from.

A customer with a marketing-specific title—CMO or VP Marketing—gets sent a tailor-made email offering advice on integrations with popular marketing tools and providing quick links to get started with marketing-specific functionality, like adding data to a spreadsheet of email addresses.

clearbit welcome email

These features are unlikely to appeal to a developer, so customers with development experience—CTO or a Lead Developer—get fast-tracked to the company's API.

The more customer data a company has at its disposal, the easier it becomes to create these perfect product experiences. Every user can be fast-tracked to the features they'll benefit most from using while sidestepping complex or irrelevant functionality. It becomes quicker and easier for them to hit their goals, and every app login and website visit becomes a memorable product experience.

The Relationship Era Is Here

The Relationship Era has been ushered in by the likes of Zendesk and Airbnb, but it's here to stay. Today's customers have higher expectations of businesses than ever before and, to succeed in the new era, companies need to fundamentally change how they view their customer relationships.

But with this change in attitude comes a huge opportunity. We're right at the beginning of the Relationship Era and, by focusing all of their energy on deeply personalized, memorable customer experiences, every company has a chance to become a market leader.

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