Drive Your Buyer’s Lifecycle, Increase Revenue and Retention

The process of acquiring and sifting traffic into engaged, and ultimately people that buy from you is critical to your customer acquisition efforts. Managing your “audience” is often referred to as the early stages of the “Customer Journey.” In this column, we’ll focus on the core and most pivotal part of your relationship with the customer –when they buy your brand. Based on some years of experimentation and measurement, we can share a simplified and highly actionable approach that can make a difference in how you value and grow value among Customers. This is the Buyer Life Cycle.   Prospects: Before They Are Customers Prospects, of course, come from many places: word of mouth and direct visits to your website and to your retail stores. Advertising and search drives them to on- and off-line points of sale. Prospects can be those who simply signed up on that ever larger email signup popup on your homepage, or those who put items in a cart and “almost” purchased, but abandoned. But prospects can also be those who we leverage statistical intelligence to hand-pick not just look-alikes but the “buy alike” prospects with the highest potential value. See my prior column called  The Most Important CRM Metric You May Be Overlooking). All of these prospects have the same thing in common, they have not purchased, and a level of investment and communications will be required to drive them to the next step. This cannot be overlooked without consequence. Prospects, regardless of the level of engagement or targeting, have a massive, and in some cases, a predictable difference from the buyers you seek...

Customer Value: Narrowcasting vs. Broadcasting

Virtually every brand we’ve met with in the last few months is hungry for new customers, the war for the customer is on. For more on growing your customer base, consider reading “Bigger is Better, How to Scale Up Customer Acquisition Smarter” an article we published recently about how to grow your customer base. Many organizations are hooked on customer acquisition. That is, in order to hit sales plans for the organization, new customers will be required in large numbers. It’s about as easy to kick the ‘acquisition addiction’ as it is to kick any other for most brands. Try going without coffee suddenly, and see how your head feels. It’s not very different from reducing a business’s dependence on customer acquisition as a means to achieving revenue and profit targets. Organizations that need ever larger numbers of new customers to achieve growth goals eventually will find the cost of acquiring incremental net new customers can become prohibitive. Broadcast vs. Narrowcast The traditional model for advertising and customer acquisition has essentially been a broadcast approach, reaching a large audience that is generally descriptive of the customer a brand believes to be a fit. Contrast this with what is sometimes described as a “narrowcasting” strategy. Narrowcasting utilizes Customer Intelligence to understand a great number of discrete dimensions that a consumer possesses and can leverage statistical methods to validate the accuracy and predictiveness of targeting customers through these methods. The chart below, depicting the value of customers acquired through traditional broadcast capabilities upfront and over time, helps illustrate why “broadcast” strategies for customer acquisition alone aren’t enough. Broadcast Acquisition Strategies Lack...

The Most Important CRM Metric You Might Be Missing

Virtually every organization we have worked with in the past year is working on managing, improving, or optimizing their relationships with customers. This work falls under the umbrella term “Customer Relationship Management” or “CRM.” It is, of course, the oldest ‘new thing’ that marketers have focused on, en masse, for a long while. “CRM” as it is, is a term that means many things to many different organizations and to different individuals in those organizations. This has created some confusion and leads to missed expectations in organizations. Through meetings and executive interviews with brands, we have found that the majority of marketers will eventually describe the primary purpose of “CRM” initiatives is to grow the value of customers that do business with them. We say “eventually” because the initial responses to the question “what is the objective of your CRM initiative” gets quite a few answers including:   Know our customer better Improve communications with our customer Grow customer relationships (most common response, and also the least actionable) Decrease the usage of promotion Reduce the volume of emails sent   These are just a few of the ways the organizations we work with begin to define their CRM initiatives, but to really make a difference in the business CRM needs a clearly defined vision: Intelligently managed customer relationships grow customer value. It drives incremental profit by either reducing the cost of promotion, or driving incremental profitable revenue. CRM requires ongoing testing and learning which can strategically inform customer acquisition and in turn increases the quality of the business.   “Intelligently managed Customer Relationships grow customer value. It drives incremental...

Bigger is Better — How to Scale Up Customer Acquisition Smarter

While we’re all focused on delivering our holiday plan, every CMO I’ve spoken with in the last 3 months is focused on the same things. In 2016 “we need to achieve greater scale” –in other words, to get bigger. It would seem for sure, bigger is better. Bigger is the American way. Bigger sales, bigger profits, bigger staff and teams, bigger assortments, and bigger margins. Yes –bigger it seems is much better to CEO’s, CMO’s, and Board Members everywhere. “The Onceler” from Dr. Seuss’s The Lorax succinctly said:   “… I’m figgering on biggering” For marketers, New Customer Acquisition is the most effective way of to grow the organization “bigger.”  It’s the lifeblood of growing organizations, and is generally considered a sign of a business’s overall health. Yet customer acquisition can be resource and budget intensive, even if an solid value, and marketers require effective more intelligent approaches to achieve greater scale while maintaining budget guidance. So as you lay out plans for 2016 and how you’ll scale your business “bigger” –and hopefully better as well ― it likely makes sense to think through the most effective ways to drive scale. Leveraging Customer Data with ever increasing intelligence is the common thread from some of the best strategies I’ve worked with brands on successfully over time. Programmatic Advertising Advertising is being increasingly automated, and over time, it’s expanding across web, mobile, and now television and “over the top” television (think web based TV –where a programmatic buy may land your ads on Netflix one day soon). Programmatic display advertising is largely however a web based phenomenon. It adds data...

Marketing Machines — Possible or Pipedream?

True data-driven marketing is still “just a dream” for many marketers, rather than a reality. Under this vision, systems data mine autonomously, and present fresh actionable insights at your desktop in the morning. For about 99% of marketers, this may sound too good to be true –and in all candor it usually is. But it is important to know and recognize that the intelligent application of mathematics and statistics, and the creation of purpose specific algorithms, have been quietly creating value for years now. Yet the typical marketer still struggles to find enough time to get the mail out, or execute well thought website marketing experiments against a control. (see “Analytics Isn’t Reporting”) So there have never been more skeptics of the legitimate power of the intelligent application of data, even as the c-suite expectations of a data strategy that creates competitive advantage grows. Sound like your experience, industry, or career? Sure it does. But as investment continues to grind higher and competition grows, progress continues to be made. The “Amazon” of Data, is of course, Amazon. You may know that Amazon.com elected to release to the public some technology they use internally in making recommendations and determining what you’d be likely to buy and when. They took the same toolset they use and published it on Amazon Web Services. “Pretty neat” you might say…   Since we get so many questions about how Amazon does it, and how all this actually works, we’ll break down the AWS Machine Learning and Prediction toolset so that qualified organizations have an idea of what’s possible. For the purposes of this article...

Analytics Isn’t Reporting

Working with multi-channel retail organizations, we’ve experienced the frequent concern that online is competing with, or “cannibalizing” retail sales. It seems like a reasonable problem for those responsible for the P&L of the retail business to consider, same for the general managers responsible for the store level P&L. I like to do something that we “digital natives” (professionals whose career has only been digitally driven) miss all too often. We talk to retail people and customers in the stores, store managers, general managers, sales and service staff. Imagine that… left-brain dominant Data Athletes that want to talk to people! Actually, a true Data Athlete will always engage the stakeholders to inform their analysis with tacit knowledge. Every time we do this, we learn something about the customer that we quite frankly could not have gleaned from website analytics, transactional data, or third party data alone.  We learn about how different kinds of customers engage with the product and their experience in an environment that to this day is far more immersive than we can create online.  It’s nothing short of fascinating for the left-brainers. Moreover, access and connection with the field interaction does something powerful when we turn back to mining the data mass that grows daily. It creates context that inspires better analysis and greater performance. This best practice may seem obvious but is missed so often. It is just too easy to get “sucked into the data” first for a right brain dominant analyst. The same thing happens in an online only environment. I can’t count how many times I’ve sat with and coached truly brilliant web...