Customer demands are ever-changing, especially given the digitization of various touchpoints throughout the customer journey and the increase in competitive content on various marketing channels. Customers are demanding more personalized engagements and require businesses to adjust their customer-related activities to their experience preferences. By prioritizing relationships and engagements with your customers, you’re able to both grow your customer base through effective acquisition and retain existing customers through personalized experiences, simultaneously. After all, the customer’s experience is a competitive battleground and sets the foundation for sustainable business growth.
“If You don’t take care of your customer, your competitor will.” – Bob Hooey
In recent years, sales and marketing teams’ primary metric priorities have shifted from mass marketing tactics and increased sales, to increasing the overall experience and satisfaction of their customers – with the long-term goal of growing and retaining a strong customer base, that ultimately boosts sales and profit, naturally. This is due to the increase in competitive marketing-related content and products/services available for customers to choose from.
Given this competitive noise, customers are seeking to allocate their buying power to businesses that not only provide the products/services they require but experiences that are more personalized. The focus has thus shifted to relationship-building and creating experiences for customers that cater to their needs better than direct and indirect competitors ever can. This relationship starts with the very first touch-points within your Customer Acquisition Strategy (CAS) – your sales and marketing activities.
Given that the concept of Customers and Conversions is so broad, this topic has been split into two parts to give you a holistic overview of various customer-related strategies. This first part will predominantly focus on various Customer Acquisition Strategies (CAS) and will later expand on various Customer Retention Strategies (CRS).
OBJECTIVES:
PART 1: CUSTOMER ACQUISITION STRATEGY
PART 2: CUSTOMER RETENTION STRATEGY
The Role & Importance of “Smarketing”
Important Sales & Marketing Terminology
The Customer Acquisition Strategy (CAS)
The Customer Retention Strategy (CAS)
Sales & Marketing Terminology
When launching and growing a startup business, it’s essential that your sales and marketing teams work together to collectively grow the customer base and increase the revenue streams of the business. This collective effort to grow the business is called “smarketing” and primarily refers to the process of integrating the sales and marketing activities of the business. The primary goal of “smarketing” is to deploy an integrated approach that involves continuous and effective communication between the sales and marketing departments – no matter its size.
Subsequently, your sales and marketing teams have to understand each other’s language to ensure optimal performance. Although these teams might share a similar vocabulary, certain concepts are primarily linked to sales-specific processes and activities.
Sales Terminology
Lead Generation
Lead Generation (LG) is considered the stimulation, activation, and capturing of consumer interest within the Customer Journey Map – (CJM: Awareness – Decision Stages), or the initiation of some form of inquiry regarding the business and/or its products/services. Lead generation, typically synonymous with customer acquisition, is built through various marketing-related activities and enables a business to kick-start, as well as nurture relationships with these customers before they’re ready to make a purchase-related decision.
Lead Qualification
Lead Qualification (LQ) is the process of comparing customer behavior with predetermined sales and marketing goals, objectives, and Key Performance Indicators (KPIs). Based on these predetermined qualification criteria, the sales/marketing team categorizes customers by the degree/level of their intent, willingness, and readiness to complete a series of actions – including submitting an inquiry or making a purchase-related decision.
Typically, customers’ actions and progression through the Customer Journey Map (CJM) or sales/marketing funnel are monitored closely, more so on digital platforms, and distinguished between cold, warm, and hot qualified leads. This indicates how close the customer is to purchase the product/service.
Marketing Qualified Lead
A Marketing Qualified Lead (MQL), in the most basic terms, refers to a customer that is considered sales-ready, based on their behavior with marketing-related channels and content but is not entirely ready to receive personalized attention from the sales team. Generally, this customer is dubbed more likely to engage in either an initial or repeat purchase, compared to other customers/leads. Their engagement/interactions with various marketing-related channels and content are closely monitored to determine their qualification status.
Sales Qualified Lead
A Sales Qualified Lead (SQL), in the most basic terms, refers to a customer that is considered ready to receive personalized contact/follow-up from the sales team, based on various predetermined buying signals. This customer (1) has moved through the Customer Journey Map (CJM) or sales/marketing funnel, (2) has progressed through the lead qualification process, (3) is prioritized by the sales team for additional intervention, and (4) deemed ready to be contacted to convert the customer and close the sale.
BANT Formula
BANT is a sales acronym used primarily within the Lead Qualification process, is typically referred to as the qualification criteria/system of the sales team, and determines whether a customer should be prioritized for intervention:
GPCTBA/C&I
According to Cox and Smart Insights, the BANT formula was initially created by IBM decades ago and has since been replaced with the GPCTBA/C&I formula by most sales teams. This model includes the same criteria as the BANT formula but has been adjusted to accommodate the complexity of the Lead Qualification process.
Sales Conversion
A Sales Conversion (SC) or Conversion Rate (CR), typically aligned with your SMART sales/marketing goals and objectives, takes place when a prospective or current customer visits your traditional/digital marketplace and engages in / completes a predetermined sales action. This action could include (1) the completion of a form, (2) making a purchase, or (3) engaging in other predetermined purchase-related decisions.
The Conversion Rate (CR) is calculated as follows:
Conversion Path
The various activities a single customer must embark on throughout the Customer Journey Map (CJM) or sales/marketing funnel (Awareness to Purchase) are considered the conversion path. It assists sales/marketing teams with categorizing, capturing, and qualifying customers according to their buying intent and purchase behavior.
A basic form of a conversion path includes the following: (1) Enabling a call-to-action (CTA), typically in the shape of a button/form, (2) taking the customer to a landing page, after completing the CTA, (3) redirecting the customer to a thank you page / sending them an email / SMS to thank them for completing the CTA, and (4) giving them access to an additional and relevant CTA, related to their last action.
Once this conversion path has concluded, the customer is guided towards the next conversion path. Since each CJM, sales/marketing funnel, or buying/purchasing process is different, there could be multiple steps or fewer steps/conversion paths toward the ultimate conversion/purchase stage. However, less is more!
Cross-Selling
Cross-selling refers to the practice of promoting additional products/services to existing customers, typically within the same conversion path. When a customer clicks on a specific product, the business would typically promote additional products/services that could complement that purchase. This would include another conversion path, usually referred to as in-purchase recommendations – which are primarily driven by Artificial Intelligence (AI) and Machine Learning (ML) today.
Example: Suggesting the customer purchase a camera (primary product), with a memory card (complimentary).
Up-Selling
Up-selling is considered a vital sales technique when aiming to increase the revenue generated per customer and per customer purchase/ purchasing process. This process includes inviting the customer to purchase additional products/services that are more expensive than the originally selected product/service, which includes upgrades or add-ons concerning the product/service selected by the customer.
Example: Suggesting the customer purchase the latest version of the camera & a larger-sized memory card.
Buying Process/Cycle
This process, typically synonymous with the stages in the Customer Journey Map (CJM), refers to the steps/stages a prospective customer has to transition between before deciding to make a purchase-related decision. Although there are predominantly 9 stages within this process/cycle, usually aligned with the composition of your business model, these stages are universally boiled down to the following lifecycle stages: (1) Awareness, (2) Evaluation, and (3) Purchase.
Sales Funnel
The Sales Funnel (SF), used in conjunction with the Customer Journey Map (CJM) or Marketing Funnel (MF), serves as a visual representation of the customer journey – often referred to as the buyer or end-user journey. It is, essentially, a depiction of your customer interactions or engagements at each touch-point throughout the customer journey, and the subsequent customer purchase and sales pipeline actions throughout. Using the stages described within the Customer Journey Map (CJM) and sales/marketing funnel, let’s take a look at a few sales pipeline actions during each stage:
Marketing Terminology
Word of Mouth (WOM)
Word of Mouth (WOM) is considered an organic marketing tactic that refers to the voluntary exchange of information between current and prospective customers of a particular business. The content of these conversations is aided through various marketing-related materials, both digital and traditional, as well as a variety of customer experiences. Although this process is inexpensive, it’s certainly challenging to initiate these types of voluntary conversations about your business – typically, kick-started through severely negative and extremely positive customer experiences.
Closed-Loop Marketing
Closed-Loop Marketing (CLM) is considered the practice of executing, tracking, and displaying how marketing activities/efforts impact bottom-line business growth. This process entails tracking one customer from their first interaction/engagement with the business to the very last stage within the Customer Journey Map (CJM), Sales Funnel (SF), and Marketing Funnel (MF). Should this process be executed properly, you’ll be able to view how much of your marketing investment yielded business growth.
Clickthrough Rate (CTR)
The Clickthrough Rate (CTR) refers to the percentage of customers/audience that navigates between and within your marketing channels/ platforms through clicking on various conversion paths within your marketing campaign. To calculate your campaign’s Clickthrough Rate (CTR), you’ll divide the total number of clicks received by the number of CTR opportunities presented.
Content Friction
Content Friction (CF) refers to any element within your traditional or digital marketing-related content that causes the customer to experience negative emotions/feelings, such as confusion and stress. Examples of friction-causing content elements include (1) distracting typography/fonts, (2) dissonant colour combinations, (3) text / image overload, (4) navigational / button overload and so forth. This typically relates to User Experience (UX), which refers to the process of creating an excellent content/channel experience for customers.
There are so many other concepts and terms that I could share with you, as these that I’ve discussed simply scratch the service. However, this is much more than a simple glossary – each of these words, and all the other concepts out there, are loaded with strategic thinking and actions. Each term or concept holds a place within either your Customer Acquisition (CAS) or Customer Retention Strategy (CRS), as well as your overall Integrated Sales/Marketing Strategy (ISMS).
Customer Acquisition (CA) : Consideration Areas & Strategies
So, why did I want you to think about your feelings/emotions during these two experiences?
The customer experience stimulates certain customer emotions/feelings, and by these two working together, it results in various customer behaviors – either favorable or unfavorable towards your business. These emotions/feelings typically have a lasting effect, especially when negative, and can only be overrun with positive experiences when a business can implement a solid sales/marketing contingency plan – with the aim of retaining that customer and improving their overall experience.
The focus should thus not only be on their lifetime value but the emotional connection and relationship.
Customer Emotions
There are primarily seven categories of emotions that customers could experience within a specific scenario: (1) Happy, (2) Surprised, (3) Bad, (4) Sad, (5) Fearful, (6) Angry, and (7) Disgusted. Each of these categories results in micro-emotions, which provide the customer with the final opinion regarding their overall experience during the specific scenario – which could refer to a specific stage within the CJM or SF/MF.
The aim is to stimulate positive experiences and emotions/feelings throughout the Customer Journey (CJ), to ensure customer satisfaction and increase customer conversions throughout. Should the customer experience negative emotions during the stages of the Customer Journey Map (CJM), this could hinder the purchasing process and ultimately cause the customer to “back out” – irrespective of the stage they’re in. Customer experiences, emotions, and behaviors should thus be prioritized and analyzed throughout.
With this in mind, which Customer Acquisition (CA) tactics can you implement to ensure an overall positive experience for your customer and ultimately encourage them to make repeat purchases?
Let’s explore two categories of acquisition tactics that could possibly stimulate positive experiences and emotions within your customers.
Marketing Activities: Channels & Content
Your marketing channels serve as the primary vehicles to both gain and maintain awareness among prospective customers and to generate sufficient leads for your business. The channels you select, to distribute your marketing-related materials/content, should be selected carefully and done so by keeping both the traditional and digital locations of the customers in mind.
If customers can’t find you /the channels they’re looking for, this might stimulate negative experiences and emotions – causing the customer to consider competitive offerings. The key action words here are thus visibility and accessibility – typically aided through various marketing channels such as (1) Search Engine Optimization (SEO), (2) Pay Per Click (PPC), and (3) Social Media Marketing (SMM) / Advertising.
Once you’ve selected the appropriate marketing channels, and you’ve both created visibility and provided access to your channels, you need to ensure that your content strategy for those channels is optimized. You might be reaching your prospective customers through the right channels, but if your content isn’t valuable, desirable, and relevant, the consumption process could result in negative experiences and emotions/feelings. You thus need to focus on two keywords:
Let’s explore a few marketing and sales strategies that you could consider implementing to aid Customer Acquisition (CA).
Evergreen Content
Evergreen Content (EC) refers to content that continuously provides value to readers/customers no matter the period within which the content is accessed. This type of content is considered timeless, valuable, definitive and of high quality and can be referenced by the customer throughout the entire Customer Journey (CJ). This type of content is typically used within Search Engine Optimization (SEO) strategies, given the SEO ROI value provided.
Dynamic Content
Dynamic Content (DC) refers to various marketing messages transformed based on the information and insights gathered on a particular customer. Typically, this type of content is met with marketing automation software and various AI-based recommendation tools embedded within a website. This captures the navigation and engagement signals of the customer – enabling a
business to customize content/offerings based on those engagements in real-time. This is also often referred to as Smart Content (SC).
Snackable Content
Snackable Content refers to bite-size pieces of content that are easy and quick to consume, without making the customer feel overloaded. This is typically implemented on social media, where the attention of a follower/customer needs to be grabbed as quickly as possible.
Storyscaping
This refers to the process of creating a story in which your customer could resonate with or immerse themselves – typically related to fantastical narratives. The use of storyscaping usually depends on the nature of the business but has been shown to attract the attention of targeted customers who could resonate with the information provided – typically focusing on the emotions and personal experiences of the customers to generate them as leads.
User Generated Content
One great way to engage your customers and make them feel like they’re a vital part of your business is to repurpose the content they’ve created/provided about your business into your marketing campaigns. This includes showcasing customer testimonials/reviews, and other pieces of content such as works of art.
Referral Programs
Referral programs often serve as the basis of many customer acquisitions and conversion strategies – especially when you’re a startup business. You offer current customers incentives for spreading the word about your business and convincing those customers to make a purchase-related decision or engage in a predefined activity within your conversion path. These incentives could include various freebies and discounts, typically provided to both current and prospective customers. However, referral programs only work if the customer experience was positive.
Competitions & Giveaways
One of the most widely used customer acquisition and conversion tactics includes launching a competition/giveaway on your marketing channels. This process not only generates awareness for your business but encourages prospective customers to actively engage with your business and marketing-related content. This offers some customers the chance to experience your product/service and potentially engage in a self-initiated purchase in the future.
Email Marketing
Email Marketing (EM) refers to the practice of sending commercial content to specific target audiences/customer segments through emails. The typical messages included in email marketing campaigns include (1) Business News / Public Relations, (2) Promotions / Offers, and (3) information Requests. Typically, the business would only have a database of current customers or customers who’ve engaged in various activities within conversion paths. To acquire new email addresses, some businesses even go as far as purchasing another business’ database – after rigorous research, deemed a list of prequalified customers/leads.
Customer Support
Apart from excellent content strategies, the need for proper and adequate customer support goes without saying – it’s essential to aiding the customer in completing the purchasing process. Should your customer feel they’re supported, this will possibly remove any negative emotions, such as uncertainty/fear, stimulate positive emotions and set the foundation for a trusting relationship. This refers to both direct and indirect customer support tactics.
To provide adequate customer support, you need to ensure, at a minimum, that (1) you provide access to quality sales-related processes that don’t slow down the purchasing process, (2) that you provide access to optimal customer inquiry/feedback channels, (3) you qualify customers/ leads properly and provide the required/appropriate support/outreach/content where/when needed, (4) you provide your customer with sufficient information/education about your business, offering and sales-related processes, (5) you embed sound customer contingency plans should customers provide negative feedback, (6) you train your employees on optimal customer support tactics, and (7) embed sound / agile sales-related processes, systems and controls to optimize the entire sales process.
Relationship Management
The latter is typically accompanied by a Customer Relationship Management (CRM) strategy and various software/tools to support the activities pinned within this strategy. To optimize the entire customer support journey and enhance their experience, you could consider investing in CRM software. So, what is Customer Relationship Management (CRM)?
Customer Relationship Management (CRM) is the process of initiating and managing the engagements of current and prospective customers/leads at various touchpoints throughout the CJM / SF / MF. This process enables a business to view a single customer’s progression through the CJM and sales/marketing funnel and determine which sales and marketing-based activities are required within the conversion path to convince the customer to make a purchase. This provides a business with a 360-degree view of customer interactions/engagements at various touch-points and assistance the customers need to progress through the CJM and sales/marketing funnel.
Customer Retention (CR)
Customer Retention (CR) involves exceeding the expectations/needs of the customer and continuously stimulating feelings of satisfaction/delight/amazement when engaging with your business throughout the Customer Journey (CJ). The keywords to focus on when creating your Customer Retention Strategy (CRS) is thus satisfy, exceed, delight, and amaze.
The aim of this strategy is not only to meet the expectations of your customer or ensure the standard level of satisfaction to guarantee the initial purchase – leave that for your Customer Acquisition Strategy (CAS). The point is to continuously create positive experiences and provide customers with additional value/benefits from time-to-time – not only ensuring satisfaction but delight or amazement. There isn’t one universal feeling of customer satisfaction – it is a complex and multifaceted / multi-layered concept. Let’s explore these layers briefly:
Meet Expectations
This is the most basic level of satisfaction and requires you to meet your customers’ fundamental needs the majority of the time. To acquire customers, this is the minimum required level of satisfaction. However, meeting expectations doesn’t always lead to repeat purchases.
Example: Providing a product/service as requested/paid for.
Exceed Expectations
This level requires a business to surpass the customer’s basic needs /requirements and provide access to something extra that the customer will find valuable/useful – other than simply providing access to the product/service they requested/paid for.
Example: Providing exceptional after-purchase customer service.
This example might come as a surprise, but customer service is not always a priority for some businesses. So, when great customer service is experienced, it certainly exceeds expectations.
Delighting Customers
The next level of satisfaction is emotions/feelings of delight, which requires a business to go above-and-beyond for the customer in question and stir more than one feeling of happiness. Think The Feelings Wheel. This requires tactics that will keep the customer away from competitors and engage in repeat purchases.
Example: Providing the customer with various incentives, such as rewards /points, a valuable gift, and discount codes/vouchers.
Amazing Customers
In addition to delighting customers, amazing customers is probably the hardest emotion to achieve. This requires a business to provide access to something that takes the customer by complete surprise.
Example: Sending the customer a personalized thank you note and giving them free product/service samples to test.
Each of these layers could constitute a separate tactic within your Customer Retention Strategy (CRS). However, to understand how to meet/exceed expectations and delight / amaze your customers, you need to have a comprehensive understanding of their basic needs and what would constitute a more-than-satisfactory experience. Typically, delight and amaze-related CRSs are geared more toward loyal customers, which typically constitute 80% of your customer base and primary revenue streams.
You can’t delight or amaze every customer, as it becomes an expensive project. It would thus be wise to craft your strategies according to your Lead Qualification process and prioritize customers that provide the necessary initial and repeat buying signals throughout the Customer Journey Map and Sales / Marketing Funnel. In other words – don’t aim to amaze customers that don’t know you – they wouldn’t understand its value yet and would use what you’ve given them as a benchmark for future purchases. Like any relationship – take things slow and add value as the relationship progresses.
Customer Retention Programs
A Customer Retention Strategy (CRS) or program (CRP), involves a specific set of tactics/activities designed to increase the value customers receive and the likelihood of repeat purchases. This strategy/program is also designed to enhance the customer experience, as well as ultimately boost customer satisfaction (CSAT) and Customer Lifetime Value (CLV). The primary goal of this strategy/program is to keep customers as long as possible, by convincing them that the value they receive by engaging with your business and purchasing your products/services, is better than your competitors – ultimately reducing the rate of switchability.
Customer Onboarding Program
A Customer Onboarding Program (COP) is considered a customer success function that educates new customers as to how to use a specific idea, product, or service. Rather than embarking on a lengthy quest of research, the business aids the customer in finding the information required. This process involves personalized training, according to the needs of the customer, and enables the business to provide evidence as to how the product/service could fulfill the customer’s needs / wants. This is considered an effective retention tool, as it typically reduces customer effort and customer churn. These tactics usually include product/service trials and samples.
Customer Education Program
A Customer Education Program, similar to an onboarding program, serves to educate the customer to streamline the purchasing process. This program would typically include providing current and prospective customers with access to self-service tools, such as a knowledge base and/or community forum. This enables customers to easily access answers to their questions, without/before having to reach out to sales representatives.
Customer Support Strategy
Although customer onboarding and education programs are useful in quickly aiding customers with their queries and purchase-related decisions, the power of having access to customer support services shouldn’t be underestimated. This would typically include providing access to a customer inquiry/feedback system, which would include providing access (1) to important sales contact information, (2) an automated/manned chatbot on the website, (3) a customer inquiry/feedback form or survey, and so forth.
Customer Loyalty Program
Your customer acquisition and retention strategies are crucial to the success of your business, but you shouldn’t forget about your loyal customers who engage in repeat purchases. Today’s marketplace is severely competitive and switchability rates shouldn’t be underestimated – even among your loyal customers. These customers should thus be rewarded for continuously doing business with you and purchasing your products/services frequently.
The more these customers interact with your business and purchase your products/services, the more they should be rewarded. This not only increases customer satisfaction but enhances the overall experience of the customer, continuously. The top 10 – 20 % of your customer base spend x3 times more than the rest of your customer base, so ensuring they are continuously satisfied, and delighted on occasion, is crucial.
Social Responsibility Program
Most modern customers support businesses that promote and actively engage in socially responsible business practices – embedding eco-conscious efforts within their strategies and contributing to societal/environmental well-being. These types of customers focus on the authenticity of the business and consider the business’ core values as part of their engagement/purchase consideration set.
Irrespective of the nature of your business and the composition of your offering, you should prioritize eco-conscious activities throughout your business and embed contributing to the welfare of society in general within your core activities and values. These could include (1) transparent, sustainable, and ethical business practices, (2) recycling / upcycling and general waste management, (3) overall carbon footprint reduction, (4) supporting social causes through upliftment and donations, and so forth.
Given these expectations among modern customers/clients / end-users, entrepreneurs should embed a Social Responsibility Strategy into their start-up business plan and identify opportunities for shared value from the onset and throughout their entire business lifecycle. It will form a vital part of your Customer Retention Strategy (CRS) and support the journey to creating a loyal customer base.
It’s crucial that these socially / environmentally responsible activities not only be embedded throughout your business but that they are actively communicated throughout your Integrated Marketing Strategy (IMS) – to create awareness among modern customers and propel your business onto their evoked set.
To cap off this topic, I would like to say that irrespective of the nature of your business and the composition of your offering, your customers / end-users are at the core of your business. The advantage of starting a new business in the 4th Industrial Revolution is your ability to craft and deploy a customer journey catered to the needs of the modern customer. It’s all about personalization, it’s all about proactive engagement – spend some extra time and effort in designing your customer journeys and strategies, to provide your customers with an experience they’ll never forget. Just remember: if your customers enjoy the journey, so will you!
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