IFTF: What is the Relationship Economy?
relationship economy, open, free, abundance, social, emergent, thrivable, The relationship economy is distinct from the information economy. The Relationship Economy — It's All About Valuing Customer Experiences . are a traditional behavior, engaged in throughout human history. Marketing revolution: the rise of the relationship economy. Differentiating brands today means focusing on social attributes, writes Coca-Cola's.
Incredibly, it is due to the pursuit of higher quality and ever better brand positioning that marketers themselves unintentionally created an environment where consumers wouldn't care if most brands disappeared. Just as unexpectedly, it is this dreary state of affairs that is now giving rise to the current revolution in marketing.
Marketers, eager to regain market share and loyalty, are lifting their gaze beyond functional and emotional attributes to the horizon of social attributes. Unlike functional attributes, social attributes are not about the product.
What is the Relationship Economy?
Nor are they — as with emotional attributes — about how the consumer feels when using the product. Social attributes are about relationships and relationships come in many varieties — some good, some bad.
When a relationship is good e. When it is bad e. It is this universality and consistency that has more and more marketers and manufacturers layering social attributes on top of existing products or using them as the foundation for new ones. These social attributes are drawing more and more companies into partnerships with NGOs and governments.
They are creating sharing-based business models, B Corps and the ever-expanding legions of social responsibility officers within established companies.
When a person decides to buy a product for its social attributes, they're making a statement about what they believe a good relationship is. These are values-based statements. And values are rock solid foundations upon which brand loyalty can reside for a long, long time.
Social attributes make declarations like: By themselves, the above statements are too general to be effective marketing tools. But when they're connected to a pair of shoes, a laundry detergent, a toothpaste or beverage that the buyer uses every day, they lift that product from a sea of banal sameness in which price is the primary differentiator to a place where meaning and values decrease the differentiating power of price.
This is a place where the buying decision feels more rewarding, more purposeful. It's a place where loyalty regains some of its strength because it is a new kind of loyalty — not loyalty to a brand, but the fealty one feels for those dedicated to the same higher purpose as they are.
Brands that share our dedication to a cause greater than ourselves and provide a mechanism for collective action will thrive. Because when we share a dedication to societal relationships based on moral principles, loyalty — the elusive quality all marketers seek — naturally follows. There is a powerful but seemingly counterintuitive marketing lesson in all of this — a lesson that is not easily grasped.
Viktor Frankl came close to expressing it when he said: For success, like happiness, cannot be pursued; it must ensue, and it only does so as the unintended side effect of one's personal dedication to a cause greater than oneself.
- Institute For The Future
- Marketing revolution: the rise of the relationship economy
Pursue profit and societal benefits will ensue. Pursue societal benefits and profit will ensue. If your boss doesn't go for it, it's okay. The Consumer Economy is in its death throes.
The media has exploded into countless channels that are two-way, not just one-way. People are buying less.
The Emergence of The Relationship Economy
Smart companies are building authentic relationships with their customers, no longer treating them as consumers. Smart governments are figuring out how to trust their citizens by opening their data and their budgeting processesamong other ways. Less enlightened incumbent companies, trying to keep their hold on markets and consumers, are using the old methods with greater force and accuracy. In the Relationship Economy trust is paramount.
The new physics can be confusing to incumbents.
The Emergence of The Relationship Economy
For example, the surge in openness and connectivity has created a world of abundance. Want to learn a bit about logistics?
Need to find a specialist in logistics? Most of their resumes are on LinkedIn. Nobody had to cajole them to enter their info, either. Generalizing from the Wikipedia example, many things that we thought required corporations to build are now being created collectively, at very low cost.