This is part two of a series on relationship marketing. Please check out the first post,  7 Biggest Mistakes in Digital Relationship Marketing, and make sure you’re not committing any of these before figuring out how to fix them. That post will also give you a bit more background on relationship marketing, but I’ll include a brief overview here as well.

[PS: If you're looking for more on my take of how relationship marketing and pharma fit together, then check out my white paper on "The Future of Digital Relationship Marketing in Pharma." It's the most downloaded white paper on Dose of Digital.]

Here’s our definition of relationship marketing (courtesy of our Chief Marketing Strategist, Bob Gilbreath):

“Relationship marketing is ongoing, direct, added-value communication.”

Ongoing: It’s a rhythm of regular, expected communication.

Direct: It doesn’t mean buying media, but owning it: You have permission to communicate, and it can be done in many forms.

Added Value: The marketing itself fills a need; usually, the greater the value to the customer, the greater the ROI.

That last one is important: “fills a need.” If you’re not doing that, then you’re probably just annoying your customers.

So, to ensure you’re not doing this, I’m going to share with you what I call the 7 Golden Rules of Digital Relationship Marketing. This is your list of “what to do.” Follow these seven rules and you’ll be well on your way to a very successful program.

One note, some people refer to relationship marketing as CRM, or customer relationship marketing (or management). For the purposes of this post, I’m saying they are the same thing.

So, here’s the list of what TO do:

7 Golden Rules in Digital Relationship Marketing

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1. Sharing, partnering, endorsing
2. Perfect pitch
3. Personalized and individualized
4. Keep it simple, stupid
5. Members only
6. Personal investment
7. It’s not about you

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1. Sharing, partnering, endorsing

If you are completely reliant on your own promotional efforts to increase enrollments in your program, then you’re missing a giant opportunity. At a bare minimum, you should include social sharing tools that make it easy for people to share your offers with others and encourage them to join your program. Incentive strategies, where you pay current members something for each new member they enroll, fit in here as well. Beyond social sharing, if your program is good enough, you can look towards industry groups and, in the case of healthcare, patient advocacy groups to grow your enrollment. If your program is valuable enough to their members, these groups will help you and will be your most effective enrollment tool. In the case of healthcare, physicians can become recruiters too if you show them how your program both benefits their patients and helps them to more easily manage these patients.

2. Perfect pitch

(Image from The Brand Builder Blog)

In order to keep people engaged over time, you have to communicate with them regularly (but not too regularly) and about things they care about at that moment. This is simple to achieve if you’re willing to do a little planning. Before building anything, plan out what you want to say and what channel you think is best to communicate it. From there figure out when it makes the most sense to communicate. For example, you probably should hold your stories about cold and flu until cold and flu season hits. Once you have these three pieces, then it’s simply a matter of laying it all out on a timeline.

Doing this accomplishes three things. First, it ensures that you’re covering your main points of communication and what your customers care about over a set time period. Second, it also serves as a commitment and motivation tool for you. Once you have it down in your timeline, you’re far more likely to actually do the work to launch the piece on time. It makes it far more tangible. Finally, having a quality timeline will help you make budget decisions should you receive more funding or (more likely) have some cut. You’ll be able to tell where you have additional capacity or where you can use some more.

3. Personalized and individualized

I’ve written about this before and spelled out what I think the difference is between these two terms (yes, there is a difference).

Personalization means adding some personally identifying information to your communications. This usually means putting someone’s name on the top of an email or direct mail piece. It’s remarkably simple to do with digital media and has become very simple (and cost effective) in print as well. Adding someone’s name to an email, for example, is much better than sending an email with “Dear Person” or “Dear Cancer Person.” I only joke because I have seen these before. I assume they were mistakes, but I saw them.

Individualization is something different. For our purposes, individualization means creating communications that are tailored for each and every individual person. The test to see if you’re sending out individualized messages is simple: does someone read what you sent and think, “Wow. They wrote this just for me.” If not, then it’s not individualized. This too can be really simple and more and more companies are embracing it. Here’s a great example that my colleague, Bob Gilbreath, wrote about on his Marketing with Meaning blog:

First, Delta included his name. Good. That’s personalization. However, then they go on and apologize for sticking him in a middle seat on his last flight and offer him some miles to say sorry. Interesting point to note, Bob didn’t ask for this or complain to Delta. They just did it. Delta knew the situation and sent an individualized response. Question: if Bob got this email and the 500 miles or another email that simply gave him 500 miles without the individualized touch, which would have more impact? Each results in the same value for him, 500 miles. But clearly the one that talks about his specific situation makes a lasting impression. So, you can’t just give away stuff and expect that to be enough. You have to make the extra effort to make it meaningful.

If you invest the time and effort to know what your customers are doing and what will be meaningful to them, then your communications will become more and more relevant to them. As they pass over hundreds of other emails they receive, but can’t remember why, yours will be the one that stands out.

4. Keep it simple, stupid

We marketers like to complicate stuff. One of these things I mentioned in the 7 Biggest Mistakes in Digital Relationship Marketing. It was number 4: Make it hard. Basically, if you make your enrollment process really difficult or make it a hugely daunting task to get any sort of individualized information, people just aren’t going to do it. So, you have to make it easy…simple, that is. Of course, our programs can be highly complex and necessitate a knowing a bunch of information in order to give good information back. That’s all right.

If your program requires a complex or lengthy process to yield the best information in return, you can’t just start with this. You need to start with a “light” version of your process to get people interested and engaged. Later on, you can add in something more complex once people are committed to your program and want to do even more with it.

For ConAgra Foods’ program Start Making Choices, our company (Bridge Worldwide), created two different ways to get individualized information. The first consists of just five questions on a simple slider bar design:

If people wanted the most individualized information (likely after seeing the quality information they received from the “light” survey) and their personal Balanced Life Index (BLI), then they are presented with a 23 question, multiple choice, survey. However, instead of making this question after question of text (or worse, 23 pages with one question each), we created an engaging design in which people swiftly entered all the relevant information. They did this because the questions were simple, but also the design kept them clicking and onto the next question, which kept dropout rates at a very low level.

5. Members only

Everyone likes being part of an exclusive club. They like the special perks that come along with membership and they like the prestige that comes with being a member. They like knowing that they’re getting something that everyone else can’t get. That’s just human nature. Do you belong to any clubs like this? Better question: do you wish you did?

Take Neiman Marcus’ InCircle program. On the surface, it’s basically a rewards program. Spend this much, we give you this much. However, because it’s Neiman Marcus, they are also dealing with people who are members of a lot exclusive programs and for whom a $100 gift card isn’t that meaningful. Neiman Marcus needs to provide them much more. So, when you get to the President’s Circle (just spend $75,000 or more in a year), you get special offers that others don’t such as exclusive off-hour shopping events.

Not every program is like InCircle, but the concept is the same. You need to reward your customers who are part of your programs lavishly and regularly. They are your best customers, the ones that spend the most, and who talk about your products to others. They’re the most engaged, as evidenced by them joining your program in the first place. Keeping them your customer is an important priority. One note of caution, simply giving people incentives without changing their underlying attitude is one of the 7 Biggest Mistakes in Digital Relationship Marketing (number 5, Dollars don’t change everything).

Giving gifts to people in the healthcare space is pretty much prohibited either by company or government policy in most countries, so this makes it a bit more challenging. You have to think beyond gifts and consider things like access. This could be access to industry experts like, say, the leading physician in lung cancer treatment. If your patients are fighting lung cancer, they want to hear what this person has to say. Limiting it to members provides a special reward to those who have given you something (their business and trust) and also makes it possible to do more. You can do more because instead of spending $5 on a hundred thousand people to give them some tiny gift, you can spend the same amount and conduct a series of powerful programs (and even travel to where patients are). That’s just one example, but the point is clear. You can provide member benefits in any industry regardless of the specific regulations.

6. Personal investment

If people aren’t personally invested in your program, it’ll be a failure. Their investment is almost always their time (but can also be financial in the case of membership fees). Time is very valuable to people especially people who are fighting a disease. They don’t have time to invest on every website about their disease. They have to focus on one or two for the long-term and everything else is likely to be ignored.

People must invest their own time in order to be engaged with your program over time . There is only one way to get people to invest their time: give them something of value in exchange for their time. This doesn’t mean offering them rewards for coming back to your site or buying things. It means that your program should become more valuable to them for each minute they invest. A great example of this is Patients Like Me.

The more information you provide about your disease (including tracking your progress and compliance with treatments everyday), the more you’ll learn about your disease. You’ll be able to track your progress against “the norm” and receive information on how to improve your situation. If you’re not willing to input this information up-front and over time, you won’t get much out of the site. However, if you are willing to do this, you receive a hugely valuable item in return: information on how to improve your health.

7. It’s not about you

This is a common sin committed by us marketers. I’ve talked about this before in the context of how to appropriately participate in social media. The same idea applies here. People inherently don’t care about your brand. Actually, they don’t care about your brand as much as you do. Because of this, creating a program that only features your brand is sure to be a failure. Instead, you need to balance your program with a mix of information about your brand and related information from which your customers are likely to get additional value.

P&G maintains one of the largest consumer databases in the world and is among the biggest users of relationship marketing. Our company works on Everyday Solutions, which is the central program for all of P&G’s products. It’s a single stop for brand offers and new product announcements, but there’s much more. There is also relevant content that matches with what each consumer has either said is an area or interest or whose behavior (pages visited, coupon offers redeemed, etc.) indicates that they are likely interested. In other words, people come to the site (or open emails or direct mail) not just for product offers and discounts, but also for other information. Those who initially come for offers see that there’s more to it than just a couple dollars off a certain purchase. This encourages them to return or to sign up for the program.

To be sure, the brands are prominently featured and are the focus of the program, but it’s not just one brand message after another. Every marketer wants to get in every core message at each customer “touch,” but that’s not necessarily a winning long-term strategy. There will be time for your messages if you can show people that your program is more than just a commercial.

Those are the 7 Golden Rules of Digital Relationship Marketing. Follow these and your program will be head and shoulders above nearly everything else out there. In case you missed them, be sure to check out the 7 Biggest Mistakes in Digital Relationship Marketing so you know what to avoid.

If you’d like a POWERPoint version of this, you’re in luck. You can download a copy of The 7 Golden Rules in Digital Relationship Marketing (811 downloads) right here. One request: if you do download it, how about sending out a tweet?

For those of you who have heard me talk about my company, Bridge Worldwide, you know that I always say that we’re a digital AND relationship marketing agency. We’ve always been the latter, going back to 1979 (and the former for almost that long). It’s an important distinction to me. Digital agencies make a lot of cool stuff, but many lack the fundamental skills that are required to build lasting relationships with customers.  Of course, we can make cool stuff too (and win the biggest awards in the process), but we pride ourselves on being able to deliver the relationship marketing piece.

So, with that, I thought I’d share what I know and have learned about relationship marketing from working with some super talented people over the past few years and from the experience we’ve gathered from managing programs that now have more than 30 million total members. I should pause for a minute and, of course, mention that we think relationship marketing is evolving to something better called Marketing with Meaning. However, the basics of what makes relationship marketing REALLY work is embedded into Marketing with Meaning.

PS: If you’re looking for more on my take of how relationship marketing and pharma fit together, then check out my white paper on “The Future of Digital Relationship Marketing in Pharma.” It’s the most downloaded white paper on Dose of Digital.

To get started, relationship marketing isn’t this:

Just because you ask someone’s permission before bombarding them with ads, doesn’t mean you’re not still bombarding them (of course, no one is asked to”opt in” in Minority Report, where the clip above comes from). That’s not real relationship marketing. Here’s our definition of relationship marketing (courtesy of our Chief Marketing Strategist, Bob Gilbreath):

“Relationship marketing is ongoing, direct, added-value communication.”

Ongoing: It’s a rhythm of regular, expected communication.

Direct: It doesn’t mean buying media, but owning it: You have permission to communicate, and it can be done in many forms.

Added Value: The marketing itself fills a need; usually, the greater the value to the customer, the greater the ROI.

That last one is important: “fills a need.” If you’re not doing that, then you’re probably just annoying your customers.

So, to ensure you’re not doing this, I’m going to share with you what I consider the 7 Biggest Mistakes in Digital Relationship Marketing. If you’re doing any of these, stop now. Seriously…now. In a later post, I’ll share my 7 Golden Rules in Digital Relationship Marketing. That’ll be the list of “what TO do.”

One note, some people refer to relationship marketing as CRM, or customer relationship marketing (or management). For the purposes of this post, I’m saying they are the same thing.

So, here’s the list of what NOT to do:

7 Biggest Mistakes in Digital Relationship Marketing

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1. No enrollment
2. Program lapses
3. Loss of interest
4. Make it hard
5. Dollars don’t solve everything
6. No customer ownership
7. All about the brand

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1.  No enrollment

If your metrics for your program look like this, well, you can imagine that your program isn’t likely to be a success. While having more enrollments in your program doesn’t mean that your program is better than one with less, low enrollment numbers (i.e., well below your target) does indicate a larger problem. This problem can be a number of things, but it usually points to a lack of commitment in the program by some function within the organization. Presumably, you set your targets based on solid estimates and extrapolations. Perhaps it was a certain percentage of people who visited your website. Well, if “corporate” pulls funding for all the traffic drivers to your website, then you aren’t going to hit your target for enrollments either in this example. If you have a bunch of enrollments followed by a bunch of opt-outs, then your program just might be bad (or commit a number of the sins below).

Figure out why and fix it.

2. Program lapses

Nothing annoys me more than this one. I enroll in your program and one of two things happen. Either you send me a welcome email or direct mail right away and then I don’t hear from you for months or you don’t send me anything initially and three months later send me the first correspondence. If you’re doing this, then don’t even bother continuing. Put yourself in your customers’ position. They probably get a lot of email that appears to be junk everyday. If an email for a program they signed up for three months ago and have long forgotten shows up, how do they react? <DELETE>. And that’s your best case. Worst case, they’ve literally completely forgotten about signing up for this program and think that your message is unsolicited spam. They report that spam to, say, Google (via their Gmail account) and before you know it, Google thinks you’re a spammer. Not good.

3. Loss of interest

This is somewhat related to number two above, but has an entire other component as well. If you never send me anything, I’m going to forget why I spent the time signing up in the first place. I’ve moved on. I probably signed up for your competitors’ programs too and if one of them is taking care of me and I’m using their products too.

And to illustrate why it’s so simple to lose interest in your program, I’d like to show you a random day from my Gmail inbox. I chose July 16 because right now I miss the summer. Here’s what it looked like:

Almost all of the emails I got that day were for programs I have signed up for at some point. You’ll also notice that I didn’t open a single one of the emails. That’s what I mean by “loss of interest.” Why did I lose interest? Simple: if your offers and correspondence are always the same, people forget why they signed up in the first place. Something interested them. Something sparked a touch of excitement. That’s long gone and they aren’t even opening your emails anymore.

4. Make it hard

There’s no better way to kill your program than to make the enrollment process a pain. Someone sent a screenshot to me of this form a while back (they can’t recall where they found it, so if it’s yours, speak up and I’ll give you the credit).

It’s a perfect example of what I like to call an “are you kidding me?” form (usually I put an expletive in there as well). An “are you kidding me?” form is one that a person takes one look at, says, “are you kidding me?” and clicks onto a different site. If your enrollment process makes someone say “are you kidding me?” then change it immediately. Keep in mind that you don’t need to know everything about the person at the beginning. Think about it as though it’s a first date. If you asked all the questions you ask on your “are you kidding me?” form, then you wouldn’t have many second dates. Instead, get the basics now and later on collect more information. Remind people that the more they tell you, the more tailored your offers will be (they will be tailored, right?). Then deliver this. The more the customer sees this, the more information they’ll share. And, by the way, you don’t get a pass by making your two thousand, initial profile questions “optional.” Just the sight of them or the thought that one day they’ll HAVE to answer them to get anything useful from this program, is enough to turn people off.

5. Dollars don’t change everything

Hold onto your hats, this one’s a bit technical. For those psychology experts out there, you’ll love this one. The main idea here is that simply “bribing” your customers via more and more offers or discounts over time isn’t likely to be a winning long-term strategy. The reason for this is simple. First, you have to keep increasing the offers to keep these people interested, which will eventually bankrupt you. If it doesn’t bankrupt you, it’s because you’ve withdrawn the best offers and likely lost a ton of very unhappy customers.

So, why, you might ask yourself, do people who previously have been given so much instantly desert me when I stop the offers? This is simple and, ironically, it turns out that those who are offered less, will likely be the ones who stay with you forever even when you take away their small offers. It’s a classic case of cognitive dissonance at work. In this case, your loss of customers is explained because you never changed their attitude towards your products. You only changed their behavior because of the money (or other offers) you gave them. When you take away the incentive, you’re left with the same attitude they’ve always had, which means they go back to the original behavior (i.e., not buying your products). This phenomenon is called the Point of Minimum Justification (which is explained really well in one of my favorite business books: Universal Principles of Design). It’s illustrated like this:

As you increase incentives, you change behavior (red line). This is the idea behind “everyone has their price.” That is, for the right amount of money, people will do almost anything. The blue line shows how attitude changes with increasing incentives. It too increases at first with increasing incentives, but eventually disappears. Attitude here is your attitude to the product or service (or situation). An increase in attitude on this chart symbolizes a positive change and you want people with a higher, positive attitude towards your product.

Why does this graph look like it does? Simple. When you give people a lot of money to do something, they justify doing it because of the money and NOT because they think what they are doing is a good or enjoyable thing. On the other hand, if you give people very little incentive to do something and they start doing it, they justify the reason for doing it because they believe that what they are doing is a good or enjoyable thing. It’s all because of cognitive dissonance. In the case of a product being marketed through relationship marketing, increasing your incentives will get people to use your product because they are simply taking advantage of your incentives. When the incentives are gone, so are they. On the other hand, having just the right incentives causes people to truly consider why they are using your product. They become more invested and perhaps learn more about what makes it so great and even become advocates. Since they aren’t justifying using your product because of incentives, they justify it in other ways.

The point at which you can provide the smallest incentive with the greatest change in behavior AND attitude is the point of minimum justification. It’s what you want to shoot for in your program. In the case of pharma, I see too many new adherence programs relying soley incentives to keep people on the drug. This isn’t a winning strategy. For people to truly want to continue their treatment, they need to understand why they are taking it and the risks and benefits. If they’re just taking it to collect your incentives, then they aren’t doing this. You’re not changing attitude, which won’t be effective over time.

For more on where this concept was born, check out the Wikipedia article explaining Festinger and Carlsmith’s classic experiment back in 1959.

6. No customer ownership

If I have nothing invested in your program, then I’m not going to continue with it. My investment is usually my time and if I haven’t given you this, then I’m not going to be a part of your program for long. However, be careful that you don’t create this investment while you commit sin #4, Make it hard. Don’t create work for people just so they waste their time. That’ll get them to quit your program really quickly. Instead, find ways to ensure people’s time investment yields them something of value. Consider the time people invest in tracking their runs via Nike+. It would be hard for another competitor to come along and steal away any regular user of this program simply because they have so much invested. They’d have to start from scratch and they’d lose all the “credit” for all the runs they’ve done, lose all connections to people they’ve challenged, plus having to learn a new system. Nike+, of course, gives great information back in exchange, so people feel that their time investment is worthwhile and at the same time, they make it harder and harder for themselves to leave the program each day.

Remember these things? They were everywhere for a long time. What made this so effective is that AOL realized the more free time they give, the more likely you are to stay with them when you run out of free time. Why? Simple. You’ve invested so much time into it by the time 1,000 hours (or 45 days) rolls around. You’ve got an email address you’ve shared with others, a profile that took a long time to get just right, friends who you IM…you’re not leaving all of that. AOL used this concept perfectly and became the largest ISP almost overnight. Of course, if your service stinks, then no amount of investment will keep people forever.

7. All about the brand

People don’t inherently care about your brand. The sooner you recognize that, the better. Certainly, this is true for most pharma brands. And, while some brands might have an almost cult following (Apple, Harley, etc.), most brands don’t have this luxury. Because of this, your program has to offer more than just a connection with your brand. There are already so many other programs out there connected to specific brands and stores that people lose track. Instead of getting overwhelmed, they just drop everyone. Does your stack of loyalty cards look like this?

Do you think any of these stand out from any other? Is it any wonder why people never have their card when the cashier asks?

To stand out, you program has to offer more. It has to be more than just the product. Nike+ isn’t all about Nike’s products. It comes with a valuable service that makes me (all right, makes other people) better runners and, in turn, healthier.

So, those are the 7 Biggest Mistakes in Digital Relationship Marketing. Steer clear from these and your program is already far ahead of most that are out there. Coming soon, I’ll share the 7 Golden Rules in Digital Relationship Marketing, which will highlight what you SHOULD be doing to make your program a success.

If you’d like a POWERPoint version of today’s post, you’re in luck. You can download a copy of The 7 Biggest Mistakes in Digital Relationship Marketing (783 downloads) right here. One request: if you do download it, how about sending out a tweet?