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Running a business is never just about delivering a product people want. While fulfilling needs is important for a business to survive, building positive customer relationships is necessary for an enterprise to thrive and expand. It is the quality of human relationships and the customer’s affinity with your brand that influence their willingness to purchase and their satisfaction with what they bought after the fact.
Over 50% of customers say they experience buyer’s remorse or negative emotions such as guilt and regret after making a purchase. All this results in a rising rate of returns and customers reacting emotionally at the slightest deviation from expectations. These factors feed into growing chargeback claims, with 65% of merchants reporting a rise in chargebacks and growing instances of friendly fraud over the past three years.
So what’s the way out for sellers?
Building healthy customer relationships is an excellent way to differentiate a brand from competitors, earn customer loyalty and drive business growth. Strategic customer experience management has proven its mettle in boosting sales, reducing returns, and preventing chargebacks.
Why is building healthy customer relationships crucial?
Merchants should understand that customers are ultimately humans driven by unique desires, emotions, and existential needs. Some 88% of customers look for authenticity when making a purchase decision, while 46% of consumers say they would be willing to pay more for a brand they trust. Similarly, 66% of consumers think transparency, in where the brand sources its materials, how it treats employees, and what it cares about beyond the profit motive, is one of the most important qualities of a brand. Likewise, 77% of consumers buy from brands that share the same values as them.
So when you touch customers’ human side and foster a deep emotional connection, you unfold the chance to create a positive bias in their minds toward your business. Doing this has several advantages, including:
Brands that put experiences first
Starbucks: A focus on experience
Starbucks leverages its ambiance and atmosphere to get people to come back repeatedly. In addition to selling coffee, they offer a space for people to unwind, relax, and work without being hurried - tapping into people’s emotions. Moreover, they personalize experiences by calling out people's first names while handing out customer orders and creating a humane experience. A 2021 customer loyalty study revealed that 21% of Starbucks customers return to their favourite outlet within three days, highlighting the importance Starbucks gives to making their customers “feel at home.”
Patagonia: Building a positive reputation
Patagonia uses organic cotton and recycled materials to put sustainability at the top of its priority lists. With increasing awareness about the effects of fast fashion on the environment, customers can connect with them better because of the earth-friendly business practices. Yvon Chouinard, the founder of Patagonia, revealed to McKinsey that the self-imposed 1% earth tax might not solve all the environmental issues, but it is the best a company can do. Such honesty resonates with younger generations like Gen Z
Nordstrom: Connecting through personalization
Nordstrom isn’t popular just for apparel. They differentiate by helping people look and feel good. With their personal stylist program, people feel confident about how they’re looking. This extra element wins Nordstrom's massive customer trust, fosters relationships, and ensures more significant customer satisfaction.
Nordstrom CEO Erik Nordstrom revealed that customers who engage with stylists spend seven times more than others and experience higher satisfaction levels.
Challenges of building better experiences and the ways to resolve them
Getting this relationship-building game right takes consistent effort and time. Including, of course, obstacles:
Wrap up
Building strong customer relationships and loyalty is the mantra to thrive and grow in today’s competitive ecommerce marketplace. Getting it right starts with recognizing that every customer is a unique human and not just another statistic. With this understanding, you need to prove you’re not another faceless business to stand out. Leveraging emotions, empathizing with customers, and communicating promptly is the way to go. Then, as a business, you need to get creative and strive to use your team’s capacity to build the most lasting relationships.
When building customer relationships, dealing with issues like payment disputes and chargebacks can be time-consuming. Therefore, it makes better business sense to delegate tasks like these to experts to focus on what matters the most.
This content is provided by an external author without editing by Finextra. It expresses the views and opinions of the author.
Jelle Van Schaick Head of Marketing at Intergiro
07 October
Kuldeep Shrimali Consulting Partner at Tata Consultancy Services
Nikunj Gundaniya Product manager at Digipay.guru
Ryan O'Holleran Head of Sales, Enterprise, EMEA at Airwallex
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