Tips for Transitioning Customer Acquisition Into Customer Retention
Let's start at the beginning: acquiring prospects and converting them to buyers. As you know, marketers spend a significant portion of their budgets on acquisition. They do it through search engine marketing, co-registration, list appends, banner ads, social networks, blogs, offline media and the list goes on.
No matter the channel, successfully converting prospects to customers directly correlates to recency and frequency. While optimizing the lifetime value of every customer is key to success in business, starting with the time they sign up, the truth is that Minute One is when they actually deliver the highest return on investment. Day One is when they deliver the most revenue. Month One is the most valuable 30-day period. That's why a clearly defined, perfectly executed transition marketing program is vital to optimizing conversions.
Once a prospect is acquired, transition marketing begins with a triggered email. This email is delivered immediately upon sign-up, and generally delivers twice the open rates and 10 times to 12 times the revenue of a standard email program.
The cascade doesn't stop there. This triggered email includes an initial campaign, plus specially designed follow-up campaigns targeted to new subscribers. These follow-up campaigns should take place 30 days to 60 days immediately following sign-up. They're all fully automated and scheduled, saving you time to focus on other tasks. Your new prospects are being treated to personalized and carefully timed emails without you having to push a single key.
New customers and prospects respond well to frequent contact. They want to know how your company works, learn about your products and customer service, and see a sampling of the types of promotions you offer. A welcome email series keeps them informed and engaged. Every contact is a chance for a new sale.
What you must have in place at this point is a set of reporting tools that can provide you with detailed monitoring of your campaigns, tracking results directly to the acquisition source so you can continually improve the overall ROI of your acquisition programs by weeding out nonperforming sources and expanding those that work best.
This process of taking new prospects through a carefully planned introduction to your company is called transition marketing. A well-executed transition marketing program increases the conversion rate of prospects to buyers 15 percent to 25 percent vs. programs that simply add new subscribers to a regularly scheduled email program.
So that's how it all starts. What happens in part two? This is the second milestone, the one in which you're converting buyers to frequent buyers. If you're using transition marketing, you're converting prospects to buyers at higher rates than ever before. That's a great start, but long-term profitability means you need to get first-time buyers to become frequent buyers.
First off, targeting helps. By segmenting lists according to customer preferences, then designing campaigns around those preferences, you can boost performance five percent or more. Great creative concepts and frequent testing also help. But the lift generated from this kind of optimization pales in comparison to what a website re-engagement tool can do.
The best website re-engagement tools specifically identify your opt-in email subscribers when they visit your website. If they don't make a purchase while visiting the site, after leaving they'll receive an email based on the specific pages they visited. This creates a second chance for those subscribers to go back to the site and make a purchase.
They don't even have to go to the shopping cart to get an email! The email can relate to any page on the site they visited. Why is this important? Because studies show that only about five percent of your site visitors ever get to the shopping cart.
Re-engagement campaigns reinforce current sales or events. When those events are about to end, these campaigns can generate added urgency to buy — without having to offer additional incentives that end up costing you margin.
Here's a couple of examples: "Remember, we're offering free shipping this week, but it ends Friday night!" or "We're giving our subscribers 15% off this week — use the discount code SB1007."
You'll see open rates for re-engagement campaigns of over 50 percent and revenue rates as much as 12 times the revenue generated from standard email campaigns. Website re-engagement is a home run when it comes to converting prospects to buyers and buyers to frequent buyers — and it completely transforms the way companies capitalize on daily web traffic.
Your viral acquisition programs should include social networks. Creating your own social media as a customer-centric community that lives within your own branding is essential to being able to be part of the conversations people are having about your product or service. This is where frequent buyers are converted to enthusiasts.
What are enthusiasts? They're frequent buyers who like your product or service so much that they become in essence salespeople for your company. They're customers who tell their friends and family all about your company and its great products and services, and encourage them to buy from you. Enthusiasts lower your acquisition costs and increase your revenue.
A good social media tool enables you to build a branded social community where your prospects and customers form their own personal discussion groups. They share content, files and photos, and unlike most social networks, your customers always stay within a branded community center that acts as a portal to your website. This community is a place where your company can post interactive topics to generate valuable ongoing feedback from customers and prospects.
As community members invite friends and family to join, your subscriber base grows virally at almost no cost. The enthusiasm is contagious as personal discussion groups and community memberships grow exponentially.
This is technology that marketers can get really excited about using — and technology that your in-house or outsourced agency can sink their teeth into, creating powerful campaigns that give your enthusiasts the chance to shine.