Customer Lifecycle Email Marketing – The Neglected Child of Web Marketing

IMHO one of the more exciting areas of Internet marketing is an area that is often neglected and rarely talked about within most small to medium sized companies. Much emphasis and water cooler talk in Internet marketing is often focussed on Search, Social Media and how to involve Facebook into the marketing strategy. All are good and great channels and mediums for the lead generation, acquisition, branding, market intelligence and immediate distribution of marketing messaging. So while these are all great for investing marketing budgets, why is it the 80/20 rule (80% of your business/revenue comes from 20% of customers) so often overlooked and neglected? For marketers its not as sexy as the latter as their campaign strategies are focussed primarily on acquisition marketing channels for new customers, and lack of accountability for showing revenue, profits, and sustainability from existing customers.

So how does this relate to online marketing? Whether 80/20 rule strategies are sought to increase revenue from the 20% of customers through up-sell, cross-sell or direct sell tactics, the 80/20 rule impacts all web marketing channels – including Search, and especially Email.

Search is often thought of as only an acquisition medium, when in fact it also supports an integral part in the full customer life cycle. Search is the initial stage pre and post entry to the website and supports the old age AIDA sales formula. Search aims to grab ‘A’ttention of the target audience, create ‘I’nterest and ‘D’esire and drive the ‘A’ction to click through on the Search results to enter the doorway of your online business. It also plays an pivotal role during the visitors experience on the website…which is another post.

The focus on this post is on the latter channel – Email marketing channel, and its role in driving ‘significant’ increase customer lift, revenue and why its the blood for any web-based customer life cycle (CLC) program.

Regardless of the type of online business model you currently operate, a customer lifecycle program exists for your business. Visitors and customers lifecycle focuses on the creation, and delivery, of lifetime value to the customer. For example, a customer lifecycle program will look at the products/services a customer or visitor NEEDs, through the time they spend involved or interacting with the business, product or services.

Customer lifecycle marketing is marketing oriented (rather than product oriented), and embodies the marketing concept. Just as Search is integral in the online space with marketers for driving new leads and customers, so are the other marketing channels the visitor / customer uses to interact or engage with the business, product or service. Therefore, a customer lifecycle can be summed up as a summary of key stages in a visitor’s or customer’s interaction and relationship with a business, whether your business is an eStore, brochure site, membership site, etc.

The customer lifecycle can be drawn out in many different forms, from the initial lead generation, moving along a bell curved graph where customer retention is defined at the peak, and attrition thereafter.
Re-inventing and engaging the customer at this peak in a customers lifecycle is critical as its the last attempt to retain a customer in your business. Obviously other programs are initiated before this peak around other events in the retention of a customer. Apple Inc. is a great example of this in the launch of the iPod, then re-inventing it with small sizes, more space, new features (video, touch, etc.), and then as the market saturates, re-invents its product line with the iPhone and iTV.

The customer lifecycle can typically be divided into 2 stages, with a third as the last attempt. It begins with lead engagement. Lead engagement utilizes various lead generation and acquisition tactics. It focussed on grabbing the target audience attention and initiate their interest. Along this stage it aims to develop and foster the lead, to the point of conversion. At the point of conversion (sign up, purchase, subscription, etc.) the visitor becomes the customer, and enters into the second stage of the customer lifecycle – customer engagement.

Customer engagement aims to attract adoption, value and advocate the customers experience. At the tipping point of this cycle is the most critical point in retention of the customer. Lack of retention – whether through loyalty, cross-sell, up-sell, etc., the customer becomes inactive and fades off the radar, resulting in loss of potential revenue on the table. Its far less costly and effortless to retain a customer versus acquiring, yet so many marketers still are caught in tunnel vision of solely acquisition focussed.

Attempts will be made in the 3rd phase – Customer inactivity, to win back the customer. This inactivity is also based on the specific businesses product and service lifecycle, as inactivity may be within 30 days, or 12 months or any time frame for that matter. Example, online membership may see inactivity within 30 days if the member does not return and sign into the website, whereas a seasonal business (ex. snowboards and skiing) may have a 9-12 month cycle and may create sustainability with its market through lateral off-season sports (ex. roller blading, biking or skate boarding).

Businesses who fail to retain customers by re-inventing, re-defining or improving the product or business to add value or create demand, will fall to the demise of market share loss and competition, along with costly effortless attempts to win-back customers.

At the various points in the customer lifecycle businesses can avoid or mitigate customer attrition by deploying and testing retention and loyalty programs. The beautiful thing about an online business and technology, are businesses are able to capture a full spectrum, over time, of customer data. Capturing this data – whether it be an anniversary, birthday, purchase history, content interest, etc., and the collective crunching of this data, can offer huge insight into the opportunities to engage the customer on a one-to-one basis…and yes, through email.

The email channel is more than just a mass direct marketing channel. Less is more and that’s what email customer lifecycle campaign programs aim to achieve. Targeted, timely and personalized campaigns can be realized easily using some of todays available technologies.
Auto-pilot personalized emails triggered on events to satisfy customers needs, wants, desires, experience, etc. can be established around numerous points in the customers lifecycle.

For example, it may be something as simple as a friendly ‘customer support 30 day product follow up’ email campaign to build customer experience, with subtle messaging to up-sell or cross-sell them to other related products customers are buying who purchased the same item.

The type of campaigns will vary across your customer lifecycle program and are defined around specific events unique to your business, product or service lifecycle. An email marketing customer lifecycle program defined around various events in the customers lifecycle may include:

– Anniversary or birthday communications
– Related products emails driving cross-sell and upsell messaging
– Warranty deadlines emails with sense of urgency
– Sales conversion emails sent 3, 7, 14 days after sign up to drive conversions
– Purchase history reward emails
– Loyalty reward emails based on historical and lifetime value of the customer
– 30 day customer service follow up

The types of campaigns are endless. Each campaign however should be tailored around your marketing programs, and have a reason of value to initiate the conversion or dialogue with the customer.

The challenge with customer lifecycles for both traditional and online, is that its unique to every product and business. Every visitor and customer will interact differently with businesses, therefore the customer lifecycle of that business is built around those unique events and interactions of the visitor and customer.

Defining those customer events and capturing their interactions, unique tailored messaging can be delivered to the individual visitor or customer through many different forms – banner ads, website contextual messaging, email messaging, web chat, etc. This is why email channel is considered to be one of the most integral internet marketing channels to drive and support a businesses customer lifecycle program and retention programs within. Once the program is defined, the email channel can virtually be set on auto-pilot, reducing necessary resources to support the programs. Additionally, customer lifecycle email programs all offer tangible metrics to benchmark upticks in sales, revenue, lift and overall customer lifetime value.

As you develop your customer lifecycle programs for your business, and integrate the Internet marketing channel of email to drive the programs success, also seek how this integration can evolve into the other areas of your web infrastructure. For example, how customer lifecycle campaigns via email can tie into web analytics to track post-click email performance and visitor / customer history. This can provided added insight into other products the visitor / customer has interest, and allow for re-marketing campaigns if non-conversion success is not achieved.

Lastly, beyond integration of email into the customer lifecycle program and other web channels, consider boosting the performance of these email campaigns by understanding other KPI (key performance indicators) that may impact the ‘initial’ success or failure of the campaign – such as email reputation.
Email reputation involves maximizing inbox reach for your campaigns. If your messaging is not reaching the intended recipient – which may be a high-value customer, the entire lifecycle program may die quickly. Conversely this is one of the first areas to consider to boost campaign performance and ROI. Get more ‘inbox’ reach with your targeted, intelligence direct email marketing efforts, and you’ll see increased increased ROI, lift and revenues.