The marketing landscape is dramatically different to six months ago.
Budgets are frozen. Events are cancelled. Consumer behaviour has changed.
In fact, 86% of consumers say they’ve changed their behaviour as a direct result of Covid-19.
This may cause marketers to panic and throw their limited budgets at paid digital marketing channels like pay-per-click (PPC) advertising.
But these channels are set to aggressively rebound in cost and deliver fewer returns.
Instead, marketers should turn to their existing customers.
A strategy for success: customer-led growth
By putting customer engagement at the forefront of their marketing strategies, brands can turn one-off transactions into happy lifetime customers. These customers shop often, spend more and recommend your brand to others – driving down acquisition costs and significantly increasing long-term revenue.
We call this approach customer-led growth.
While traditional loyalty programmes incentivise customers who are already loyal, customer-led growth goes beyond these constraints to build loyalty into the full customer lifecycle.
Customers want brands that they relate to. Brands that actively share their values and interact with them as real people. Brands that, for example, seek their feedback and visibly act on it. Not brands that send out email blasts encouraging them to buy shoes sold out in their size.
Understanding your customers
There are three elements to consider when getting to know your customers: priorities, pains and gains.
Priorities can be practical, such as a regular online shopper ordering groceries so there’s one less task on the to-do list. Or they can be emotional, like a pensioner in lockdown buying online for the first time and feeling a sense of achievement.
Next up, their pains.
What challenges do your customers face during their brand experience?
Examples of these can be receiving too many emails; having to wait for slow delivery; finding the online process confusing or frustrating. Identifying the pains your customers face is the first step to solving them.
Lastly, their gains.
Does buying online from your brand make customers feel good and excited to return? Do they feel like your brand really gets them?
Segment your customers based on factors like demographic, frequency and average order value, then apply the above concepts to understand how best to engage with them.
Marketing goals and tactics
Once you understand your different customers’ needs and desires, it’s time to talk tactics.
We break down marketing goals and tactics into five categories:
- Goal: Increase frequency
Tactics: showing another range, offering click and collect, giving referral rewards
- Goal: Increase average order value (AOV)
Tactics: promote product bundles, segment by AOV, reduce reliance on discounts
- Goal: Increase loyalty
Tactics: run a VIP programme, use ‘feel-good’ messaging, request NPS feedback
- Goal: Increase advocacy
Tactics: segment by NPS, experiment with referral rewards, tap into feeling of discovery
- Goal: Reactivate customers
Tactics: share product recommendations, encourage user-generated content, promote brand values
For the best results, brands should use a mix of tactics based on their business priorities.
Let’s look at some examples.
Crafting brand LoveCrafts saw a surge in online orders during lockdown, as people took up new hobbies to while away the days at home.
To encourage first-time shoppers to buy again, LoveCrafts shows video tutorials presenting how they could develop their skills while showcasing other products.
LoveCrafts' video tutorial message
Other messages include NPS surveys and inviting shoppers to join the LoveCrafts community.LoveCrafts asks customers to score their experienceLoveCrafts invites customers to join its community
Testing these messages with different customer segments built brand affinity and increased repeat purchase rate. All without offering a single discount.
allplants is another brand that tailors its messaging to customers’ needs.
Following the UK government's lockdown announcement, there was a significant surge in demand for food delivery services. allplants tapped into this by updating its referral message to reflect how it could help customers stay healthy and support their friends.
allplants' referral message
It subsequently saw a sharp increase in new customers acquired via referral.
(You can read more on this in our blog on how referral drives sales for allplants during Covid-19.)
Building a base of valuable lifetime customers
For too long, brands have chased the next quick sale at the expense of their long-term strategies. The pandemic has forced marketers to rethink this approach.
Despite a challenging landscape, opportunity remains. More people are transacting online than ever before, including older demographics that previously overlooked ecommerce.
Businesses that focus on engaging with these new and existing customers will reap the rewards. Use customer retention solutions (like Mention Me Retain), and you can fuel sustainable growth for your business, now and in the times ahead.