This article is by Kara Trivunovic and Andrew Osterday
Published on January 27, 2009
I thought it was insightful so I thought I would share it.
It’s probably no surprise that the process of acquiring new customers comes with one of the higher price tags of any of your marketing initiatives. The value of growing your customer base is obvious: the potential to sell more products or services. Moreover, increasing customer loyalty will reduce your marketing costs by providing you with a growing number of prospects and customers that can be easily and efficiently communicated with.
Accounting for the following five basic lifecycle tactics for the coming year will help identify areas of focus when laying out your strategy and setting goals.
1. Target and Acquire
It’s not only about a customer database with the most amounts of records. The key is to fine-tune your targeting tactics to grow your customer database with those individuals who have a true interest in your products or services. Adding 50 new and engaged customers or prospects can have a better positive net effect on your bottom line than adding 500 prospects who might not be as interested in what your organization has to offer.
Look to add to your email database with those potential customers who have the most relevant connection with your organization. In short, poor leads equal lackluster performance and added costs.
Targeted growth provides you with a database of motivated customers who are not only ready and willing to open your email messages but also less likely to opt out of communications and less prone to mark your communication as spam.
In an email world where your Email Sender Reputation is critical, avoiding increased complaint rates with ISPs means better in-box penetration. Those spam complaints not only harm your email reputation but also limit the number of messages that individual ISPs will actually deliver to your customers who want to receive your message.
2. Onboard the Correct Way
An onboarding program that reflects your brand, sets expectations, and confirms the appropriate customer information needs to follow industry best-practices as well.
Interested prospects and future customers who desire to be a part of your marketing program are willing to share information regarding their needs. This information can be used to help grow your relationship with your customers as well as increase the trust in your brand. Create clear and easy forms that allow your customer to quickly tell you the information that they are interested in.
The more you know about your customers (not just their email address) the better. Crafting email program enrollment forms that ask the information you need to execute the most relevant communications back to them is not merely desirable, it is a necessity.
Keep enrolment forms easy to complete and available on every page of your Web site, and follow industry best-practices using a double opt-in confirmation method and welcome message. These messages need to be timely and reinforce your brand.
Waiting too long to send an enrollment confirmation or your first message can be the difference between your prospect’s staying engaged or forgetting about you and moving on to your competition.
You should also take the use-it-or-lose-it approach with collecting information during the enrolment process. Collect only the information that you will use to help get the right message to the right recipient at the right time.
3. Deliver on the Promise and Serve up the Right Content
Your email marketing programs should have a clearly defined purpose that your future email recipients will easily recognize in communications that they have requested.
“Sign up for our monthly newsletter” means that the future recipient is expecting an electronic issue every month. Inform your recipients about when they can expect your communications—and show them examples. Providing a link to your most recent communications for them to peruse may limit the number of records that you add to your database in the short term, but as noted in the Target and Acquisition section, the value in growing your database is based on acquiring customers and prospects who are unquestionably interested in you communications.
Providing the right message, to the right person, at the right time does produce results. One study over a five-year period showed that when marketers provide relevant product and service offerings to engaged customer segments, they reported an annual profit growth of about 15% as opposed to 5% for those marketers that did not take into account engaged customers and relevant content.
4. Grow the Relationship
Learn more about your customers by analyzing purchase history and Web site traffic. Satisfied customers will most likely account for a larger portion of your sales. Being able to identify the attributes of your most-engaged customers will allow you to leverage those attributes on a growing customer database.
Your best customers shouldn’t necessarily be getting the same message that you are sending to your entire database. These individuals are more familiar with your brand, knowledgeable about your offerings, and amicable toward receiving targeted promotions and tailored marketing messages.
Say in tune with the marketing strategies of your competition as well. You are all vying for the attention of that same customer. Knowing what your completion has to offer allows you to tailor messages that that can compete. Timely offers, tested frequency, and clear product differentiation afford your customers the ability to make purchase decisions quickly.
Good customers make great advocates. You customers share common likes and interests with friends, family members, and colleagues. Relying on these advocates is often one of the easiest way to organically grow customers and subsequent sales.
Retaining a customer has a much smaller price tag than acquiring a new one. Growing customer loyalty by 1% can be the equivalent of a 10% cost reduction, according to Bain & Company. “Catch-and-release” marketing tactics may not provide that top-of-mind ability to keep your brand as your customer’s first choice when contemplating a future purpose.
Communicating with your customers using messages that go beyond marketing offers keeps them engaged with your brand. Take into account birthdays, anniversaries, or holiday greetings. You communicate with friends and family with these types of greetings, why not with your customers?
Complimentary products or services that enhance previous purchases or are aligned with customers’ previous purchasing history demonstrate that you understand them as customers and can identify what is important to them.
Providing tips and tricks to help your customer’s use your product or service in more efficient ways also helps to strengthen the relationship. Keep your customers up-to-date on new products, upgrades, and updates.
Reach out when your customers become unengaged. Test the way you communicate with those individuals who stop opening or interacting with your communications. Are you sending too many or too few messages? There could be many reasons that your once engaged customer acts less interested in your communications. Monitor your reporting for cues that a change may be needed. Test your theory, and apply your learnings.