White paper - Reinventing the customer lifecycle


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This paper by Paul Kennedy at Callcredit explores how adopting a defined programme of ongoing customer communications - rather than taking a product-led, campaign-by-campaign approach - can drive better customer engagement, improve retention rates and increase revenue flows

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White paper - Reinventing the customer lifecycle

  1. 1. White PaperReinventingthe customer lifecycleThe case for a coordinated approachto customer communicationsBy Paul KennedyHead of Consulting at Callcredit Marketing Solutions plan acquire verify manage collect
  2. 2. // 01 // White Paper // www.callcredit.co.ukConsumers research online before headingto a store to make a purchase, but thereverse is equally likely
  3. 3. // www.callcredit.co.uk // White Paper // 02 Reinventing the customer lifecycle The case for a coordinated approach • he role of channels and points of T to customer communications interaction in the buying process are less fixed in the eyes of the consumer – By Paul Kennedy, many zig zag across the landscape as Head of Consulting at Callcredit they see fit. According to Econsultancy , The customer lifecycle concept is a consumers research online before familiar one for many marketers. But how heading to a store to make a purchase, many UK brands have a defined lifecycle but the reverse is equally likely. programme in place as opposed to just • eliance on direct brand presences R taking a campaign-by-campaign approach to get what consumers need being which is often product rather than gradually substituted by comparison customer segment led? What are the sites, deal affiliates, social benefits in taking an overall approach as networks, etc. opposed to tactical? Why should organisations look again at customer lifecycle approach to engaging? This paper makes the case for a Customer decision making has changed defined programme of ongoing fundamentally over the last few years – customer communications to drive not just because of the changing better customer engagement (and economic environment but also because therefore improved retention rates) of other factors such as: as well as incremental revenue flows. All of these stack up to a compelling business case. © 2012 Callcredit Information Group Ltd. All rights reserved
  4. 4. // 03 // White Paper // www.callcredit.co.uk Assumptions about consumer decisioning are wrong – the old model is brokenPrice led offers do not Consumers have less money to spend There must be something else, e.g. thenecessarily encourage than ever. The net impact of price inflation brand adapting itself to the customer byrepeat purchase, they (especially on categories such as asking what they like then building amerely achieve short term transport and fuel - the top two bespoke digital version of the brandsales uplift at the expenseof profitability. categories of household spending around each customer through according to ONS), lower wage rises and customised emails, profile pages, etc. increasing employment uncertainty Moreover, customers don’t just sit at means that many established buying home waiting for energy companies to decisions are being reviewed and changed. contact them about a better dual fuel This is one of the reasons leading to the deal or for their bank to offer an insuranceCustomers don’t just sit rapid expansion of value focused orat home waiting to be quotation. Rather, many consumers will discount brands such as Poundland,contacted. Many will make make the first move themselves in Greggs and Morrisons over the last 12the first move themselves. response to something happening in their months. Also in response to this lives like moving home or getting a new tightening, brands are wooing customers car. The old funnel model is no longer up in ever more sophisticated ways. Price led to the job and needs to be enhanced by offers do not necessarily encourage something better such as a lifecycle repeat purchase, they can merely achieve thinking. short term sales uplift at the expense of profitability. Main Actions / Intentions Recognise Personalise Up/cross sell Convert Influence Dialogue Retain Transact Touchpoints Connect Optimise Refer Web page - PC Web page - Mobile Email SMS Social Phone/voice Store/branch Printed Multiple touchpoints and multiple intentions lead to a complex web of interaction between your brand, your customer and external influences.
  5. 5. // www.callcredit.co.uk // White Paper // 04The funnel metaphor does not really help –it’s more like snakes and ladders – decisionmaking is not linear not least because ofcomparison sites and social networksA more sophisticated So, the marketing database needs to In some instances marketing databasesapproach is needed to evolve to include an overarching set of being used only as list managementdeliver above average rules to optimise the brand’s overall engines, with little regard for pastreturns. response to customer interactions. It’s communications, responsiveness etc, and more like snakes and ladders – decision data still being held in product, line of making isn’t necessarily linear not least business, maturity stage (e.g. acquisition, because of comparison sites and social single product, multi product, lapsed) or networks. The funnel is over simplified, channel silos. leading to naive marketing. A more Why does this matter and why bother sophisticated approach is needed to investing in putting infrastructure and deliver above average returns. business rules in place to raiseWithout this, customers Callcredit’s observation is that only a performance? Without this, customersmay be over-contacted minority of organisations have well may be over-contacted often with repeatoften with repeat attempts defined lifecycle programmes which guide attempts to sell the same thing in theto sell the same thing in thesame way. marketing activity – some are doing it for same way; in this context, content can be selected product lines and others are perceived by consumers as bland and reliant on rerunning a series of one off uninteresting, ending up in the spam box campaigns to generate results. or bin. © 2012 Callcredit Information Group Ltd. All rights reserved
  6. 6. // 05 07 // White Paper // www.callcredit.co.uk New customer enabling technologies have come on the scene – for consumers and marketersWhat brands know about Email marketing is long established and The proliferation of digital data that iscustomers offline should has been embraced by most organisations now being collected about individuals’be linked with what those but many of these communications still contact with the brand across web,same people do online. fail to take into account customers’ mobile and social gives access to a whole individual needs and interests leading to new view of their lives. Yes, a single low open rates (recipients know what to customer view is still needed to expect so don’t bother looking at the synchronise this data, but set it up message) and unsubscribe rates which correctly and it can also drive personalised are higher than they need be. and localised communications informed by overarching rules governing what is promoted to each member of the target audience. The rapid evolution of application and services oriented platforms of late means it is now simple to set up and operate real time multi- channel interaction platforms – they’re no longer just for those with large budgets to invest; setup is a matter of weeks or days not months. Then there’s data. What brands know about customers offline (such as where they live and in-store purchases) should be linked with what those same people do online (such as browsing behaviours). The answer lies in being able to create bridges between these two domains using Recent YouGov research everything from islands of data through to big data and everything in between, e.g. showed that 41% of the UK by combining a range of methods online population claim to be including channel data, cookies, web getting bored of social media. analyics, social APIs, etc.
  7. 7. // www.callcredit.co.uk // White Paper // 06 Therefore, the time is now right to rebuild your customer lifecycle programme Rather than just pushing out messages be getting bored of social media. Social is and products, how can customers be ideal for peer to peer engagement whilst pulled in? How can customers be treated digital marketing is best for selling. as active participants rather than just The business case is clear for a defined submissive targets? One commentator programme of ongoing customer recommends focusing on customer communications to drive better customer behaviour, putting the right technology in engagement as well as incremental place (data and platform) and revenue flows. experimenting with new benefits and analysing the impact on customer engagement. Social media is important but bear in mind that is not for everyone – recent YouGov research showed that 41% of the UK online population claim to © 2012 Callcredit Information Group Ltd. All rights reserved
  8. 8. // 07 // White Paper // www.callcredit.co.uk Cross sell Target Reengage AcquireCustomer engagement? Up sell Retain Customer Lifecycle Retention Welcome Welcome Acquire Target Cross sell Up sell Customer lifecycle? Consider a consumer’s interaction with brand over time. The lifecycle/engagement relationship has evolved from linear, to beyond cyclical. It’s about intelligently Behavioural and demographic insights built So, what does an evolved environment look merging customer service up over time can be used to inform customer like? It can be characterised by real time and selling. communications, messaging and content capture (e.g. email opens and clicks) and rather than just selecting customers use of data in communications, alongside tactically for specific product based purchase and demographic data. It may also campaigns. There are two opportunities to include socially generated data, e.g. drawn apply these insights: from Facebook via API. • utbound communications in batches O Creation of appropriate rules of engagement (e.g. email campaign or outbound is crucial: consider a consumer’s interaction telemarketing) as well as with the brand over time. Identify the most crucial customer interaction points Creation of the rules of • re-generated ‘lie in wait’ offers so that P engagement are crucial. and design a programme of content and when a consumer visits the brand and communications to ensure consumers are identifies themselves, there is a relevant engaged effectively when they choose to call to action. We can’t predict when make the move. customers are going to do this – few now sit at home waiting for that brochure or email to arrive. It’s about intelligently merging customer service and selling. It seems obvious to say it now but customers are for the most part empowered and have access to digital media. There are exceptions to this, e.g. the 10 million that are not online who may be more dependent on doorstep selling or traditional retail experiences.
  9. 9. // www.callcredit.co.uk // White Paper // 08 Consider these five key elements of a customer lifecycle programme Callcredit’s framework for setting up a customer lifecycle programme includes Moving from campaigns to lifecycles the following elements: means adopting new metrics which gauge success at each handoff point 1. Goals: and allow marketers to identify those Defined business objectives and targets customers who are likely to look most that can be mapped down to each and like good ones. every marketing activity. There can be little doubt that taking a 2. Products: customer lifecycle approach will deliver How they fit, what hierarchy, what needs better return on investment when being met, what natural affinities exist compared to ‘batch and blast’. between product areas and what are the most profitable combinations or bundles. Recent research backs this up, showing that those brands operating 3. Listening: lifecycle programmes, e.g. welcome Data gathering strategy – how can data and triggered communications, gathering and capture from customers be outperform those who do not. interesting and even fun? What tracking data can be picked up and how can it be matched back to other ‘offline’ data? 4. Scenarios: Business rules that determine the conditional sequence of actions and responses to cover all likely scenarios 5. Focus: Brands operating lifecycle Allocation of customers to defined modes of engagement – acquisition, welcome, programmes outperform those upsell, retention, regeneration, etc. who don’t. Different customers will travel through these at different speeds. Dynamic segmentation rules will help marketers think about different need groups and demographies. Predictive models will be needed to help rank customers, eg churn, cross sell, etc © 2012 Callcredit Information Group Ltd. All rights reserved
  10. 10. To find out more about Callcredit’s Marketing Solutionsemail info@callcreditmarketing.com call 0845 60 60 609or visit www.callcredit.co.ukCallcredit Information GroupEnabling Smarter DecisionsAbout Callcredit Information GroupCallcredit Information Group has a leading edge approach to using consumerinformation in credit referencing, marketing services, interactive solutions andconsultative analytics. This enables our clients to cost-effectively identify,engage and convert more new customers and optimise existing customer revenues.Callcredit offers intelligent solutions across the customer lifecycle as follows:• Plan• Acquire• Verify• Manage• CollectReferenceshttp://en.wikipedia.org/wiki/Customer_lifecycle_managementhttp://econsultancy.com/uk/blog/9152-the-high-street-is-central-to-multichannel-retail-strategyhttp://www.guardian.co.uk/business/2011/apr/18/discounters-take-over-uk-mallshttp://news.sky.com/home/business/article/16184632http://wallblog.co.uk/2012/03/05/research-says-40-of-britons-getting-bored-with-social-media-points-to-rise-of-nich-sites/http://blogs.hbr.org/cs/2012/03/how_top_brands_pull_customers.html?cm_mmc=npv-_-AWAREN-_-BONCHEK_POST-_-030512http://wallblog.co.uk/2012/03/05/research-says-40-of-britons-getting-bored-with-social-media-points-to-rise-of-nich-sites/http://econsultancy.com/uk/blog/9215-email-census-shows-link-between-email-best-practice-and-strong-roi © 2012 Callcredit Information Group Ltd. All rights reserved