Learn how to increase your customer lifetime value through compelling customer lifecycle marketing campaigns.
Create buyer’s delight, not buyer’s regret
Buying stuff conjures up many feelings within us; excitement at having something new; hope that we’ve made a good decision; anticipation of its arrival; concern that we’ve spent too much, or too little. These feelings vary wildly dependent on the size and importance of the purchase. I wouldn’t, for example, spend too much time worrying about the suitability of a purchase of water filters compared to taking the keys for a new car; but, regardless, some degree of these feelings will manifest during and after the purchase.
So, what can we as marketers do to capitalise on these feelings? Well, the absolute worst thing we can do is nothing at all.
For far too many brands, the communication stops at the sale (aside from perhaps the boring, default electronic receipts and despatch notifications that eCommerce platforms generate). The only message that this sends to the customer is that you have lost interest in them now they have handed over their hard-earned cash. This does nothing to appease their concerns about whether they have made a good decision; and it certainly won’t encourage them to buy from you again.
Customer Lifecycle Marketing
What we’re actually talking about here is post-conversion marketing. Also called post-purchase, transactional, or triggered marketing, it’s all really many sides of the same Customer Lifecycle Marketing coin.
Conversion simply means the completion of a desired action; and, as we discussed in the previous guide on lead nurturing, the desired action changes as the customer moves through our sales funnel, and through their own buying cycle. A successful conversion in the early awareness phase might be signing up to your newsletter or following you on social. In the consideration phase it could be downloading one of your resources, signing up for a webinar, or creating a wish list. However, for the purpose of this guide, we’re going to focus on the tactics you should consider implementing after the ultimate conversion – the sale.
After all, your business can only succeed if customers buy what you are selling. And that first sale feels great, doesn’t it? Especially if you’ve encouraged the customer towards the sale with a series of well-crafted lead nurturing tactics. It’s a real win – a pat-on-the-back moment. But it shouldn’t stop there. The first sale can merely be the tip of a very lucrative iceberg. When you implement customer lifecycle marketing tactics to pursue brand loyalty and further sales, you drive your business towards success.
Focus more on retention than acquisition
The first rule of business should be to retain customers and build a loyal and trusted relationship with them. It costs five times as much to acquire a new customer as it does to retain an existing one. Yet a staggering 44% of companies focus their resource towards acquisition vs. just 16% that have a retention focus (the remaining 40% splitting their resource equally). When you factor in that 76% of companies consider a customer’s lifetime value (CLV) to be an important measure of success, you start to wonder where the breakdown in focus stems from.
Let’s take a look at some more compelling statistics to see if I can’t convince you that post-conversion tactics are as, if not more, important than pre-conversion.
- 89% of companies think customer experience is a key factor to drive loyalty and retention (eConsultancy)
- The likelihood of selling to an existing customer is 60-70% vs. 5-20% for new customers (Slideshare)
- Existing customers are 50% more likely to try new products and will spend 31% more (Slideshare)
- The most used and effective tactic for customer retention is email marketing (eConsultancy)
- Increasing retention rates by 5% increases profits by up to 95% (hbswk.hbs.edu)
- 70% of respondents to a business survey agree that it’s cheaper to retain than to acquire (eConsultancy)
- Post-purchase email open rates are double that of generic mailings (Experian)
- Customer that have the best purchase experiences spend 140% more than customers that have the poorest (Harvard Business Review)
What are your post-conversion options?
I thought it would be handy at this point to offer some additional tips and stats on the different types of customer lifecycle marketing emails you can create. You’re welcome!
Thank you emails
If you want to be super engaging, segment your first time buyers from return buyers so that you can adapt the message.
Order Confirmations, Receipts and Delivery Notifications
The official communications that you generate regarding a purchase need not be boring. Maintain your brand’s style and tone throughout the entire process to reinforce the perception that the customer has of your company.
Onboarding and Tutorial emails
These have been proved to be especially helpful in reducing cancellations and returns – especially for big purchases, non-tangible goods, or orders with long lead times. You should also consider pointing customers towards your YouTube channel for added value in your cross-channel efforts.
Up-sell and Cross-sell emails
So many stats, so little word count! There are so many reasons to employ up-sell and cross-sell in your email marketing strategy that I can’t understand why so few brands do it. Here’s just a couple of extra convincers. Firstly, post-purchase emails that include cross-sell have a 20% higher transaction rate. Secondly, Amazon generates a staggering 35% of its revenue through product recommendations.
Loyalty reward emails
We’ve discussed previously in our ‘Age of the Customer’ series that loyalty is in short supply. However, as consumers, when we feel that we are showing loyalty to a brand, we want that loyalty to be rewarded. Who hasn’t felt irritation towards a telecoms or insurance supplier whose ‘special deals’ only apply to new customers? Studies show that retailers with loyalty programs are 88% more profitable than those without. Another method is to segment your ‘VIP’ customers so you can treat them to free postage or advance previews for sales, events or new products.
Have you seen the Amazon Dash Buttons? They are Wi-Fi-connected devices that you position around your home that will reorder your favourite products with the press of a button. I realise that we don’t all have the kinds of budgets that make joining the Internet of Things revolution a feasible option, but email definitely provides an appropriate alternative. Use your data to set up replenishment emails based on either the standard purchase cycle for a product, or the actual purchase cycle of a particular return customer. Just be sure to link your warehousing information; suggesting that a customer re-orders an item you don’t have in stock will not be well received.
Renewal and Anniversary emails
For those annual events, renewal and anniversary reminders generate five times the transaction rate of generic mailing. The anniversary email works particularly well in the travel industry – “it’s been a whole year since you went to……” is a common theme. Using customer lifecycle marketing to trigger memories of an enjoyable trip can coax the customer into considering where their next adventure will take them.
Hungry for more customer lifecycle marketing inspiration?
Today’s key takeaway
The customer’s journey with you shouldn’t end when they complete the checkout. They have picked you to give their money to, rather than the countless other suppliers they could have chosen. Don’t ignore that. Instead congratulate them on their great taste and decision making skills. Relish in their excitement. Reinforce that buying from you is something that they will not regret. Make them confident that they will experience the same pleasure if they purchase from you again in the future. Be personal. Be upbeat. Do this and you are far more likely to have a customer for life, rather than a one-sale wonder.