Relationship Marketing or Social Media?

I met a woman recently who’s a relationship marketing expert. Her expertise lies with big, household name companies–she uses different tactics, but most of them are various flavors of "frequent flyer" programs that reward ongoing customer relationships.

She says that she gets the question all the time, "We only have budget for one thing this year–should we do relationship marketing or social media?"

She works with giant companies and I work with small organizations, but this question drives us equally nuts. So here’s the answer.

You do both.

Most forms of social media are great for attracting attention
A YouTube video, a Squidoo lens, a Facebook app, a Digg or Del.icio.us or Stumble strategy–all of these do one thing particularly well. They capture attention.

The proliferation of advertising messages is starting to approach something out of a Philip K. Dick novel. The thicker the stream of messages, the better we get at tuning them out. In marketing jargon, this is known as "clutter" and it’s a serious problem if you’re trying to get the word out about what you do.

Social media is particularly handy at "flipping the funnel" to cut through information clutter. It works by convincing people who like you (a lot) to tell their friends about you.

The idea is, advertising messages are basically wallpaper, especially for the "most desirable" demographics (young people & rich people). Traditional advertising is invisible to the people it most wants to convince. But recommendations from friends are inherently relevant and interesting. So when you convince your customers to talk about you, you can capture the attention of potential new customers in a very quick and very vivid way.

There’s one downside: capturing attention for attention’s sake gets annoying in a hurry. Once you have someone’s attention, you need to build on that and start creating a relationship.

Some forms of social media are great for building relationships
Blogs and customer forums will help your company create a relationship with the people you attract. Rather than bungee-ing in and out based on price or where you’re ranking on Google today, your customers get to hang out and form tribes based on what you have to offer.

These tribal relationships can create a powerful bond, but they’re also demanding. As the "social object" at the center of that particular tribe, you need to participate in that messy, complicated conversation in order to keep your own credibility.

Forums and interactive spaces give customers a handy platform to talk you up. Of course, you may have figured out the scary part already–the same platform is just as handy to knock you down.

But if you’re good (and you have to be good to survive any more, there are too many businesses and services and products and organizations that are scary good), your fans are going to douse any flames started by your detractors. An army of rabid fans is the best crisis plan there is. When you can convince someone who isn’t you to defend you from the slings & arrows, you’ve officially moved your game to a whole new level.

There are plenty of relationship tactics that don’t involve social media (you can find some of those described in my relationship marketing series). There are hundreds of ways to create better connection with your customers, and lots of them fit into a more traditional marketing & communication framework.

So there’s your answer. If your culture can adapt to it (you’re highly flexible, comfortable with radical transparency, and willing to be insanely responsive), social media can be extremely effective. But don’t bother "doing social media" unless you have some solid ideas about how to build on the relationships you start.

You can have the cleverest YouTube video ever shot, but if you have no way to create a relationship based on the attraction you create, that cleverness will evaporate when the next motorcycle-riding monkey comes along.