The world as we know it has changed dramatically over the last 25-years. The internet was made public on August 6, 1991, less than 26 years ago. It has revolutionized the way business and marketing is done. Today, thousands of companies make use of the internet to market themselves, sell products and services and strengthen their brand.
As marketing is evolving rapidly in this technologically dependent world, marketing departments are finding it very hard to keep up with the change as well as finding it difficult to structure itself optimally to absorb these changes to make a meaningful impact; and hence questions on ROI on marketing efforts is making marketers uncomfortable.
We are in the age where customer is very slowly but surely becoming co-creators with the organisations/brands; today customer centric approach is the way many forward looking organisations are molding themselves into and consumer internet as well as online tech product companies are early adopters of this customer centric approach. Cross Channel Report suggests that businesses need to focus on a more direct and strategic marketing plan but for this plan to become successful requires companies of all sizes to rethink their existing marketing structure which can accommodate changing nature of marketing within the organisation which involves the use of what is now being referred to as the ‘3 Pillars of Marketing framework’.
This marketing framework involves focusing on the processes of acquiring, retaining and developing customers. The framework proposes that B2B and B2C companies channel their energy to building strategic marketing teams around these three key areas. In that way, resources operate with a laser-sharp focus and right metrics are measured.
Marketing Pillar #1 Acquiring customers
All marketing efforts start with the work done by the acquisition team. The acquisition team is responsible for getting the traction with the help of inside sales, and all tactical online marketing activities. The team also play a part in using offline advertising and media to support traction.
It comes as no surprise that 63% of marketers believe that new customer acquisition is the top priority for any company. This is why the majority of marketing money is spent in this part of marketing, at the expense of the retention and development teams.
Unfortunately what companies don’t seem to appreciate is just how important focusing and investing in the retention and development marketing teams is. For every lost customer a company loses up to $243 on average. To make matters whose, 61% of lost customers go and buy from the competitors. To put it another way, 6 out of every 10 lost customers will go to your competitors. If a company loses 6 customers a month, in a year that company may have lost an average $45,198 worth of revenue as suggested in the report published by KISSMetrics a leading online marketing analytics tool.
Customer acquisition is obviously important but all the efforts can be lost by poor customer service. In the US alone, poor customer service costs the country approximately $83 billion.
There should be a balance between all three marketing areas in order for harmony to exist. Remember that it will cost your company 7x more to get new customers than to retain the old ones. Keep this in mind.
Marketing Pillar #2 Retaining customers
90% of companies online are engaged in active online marketing efforts. The retaining team is expressly involved in improving online user experience, customer service and working on the company’s design and packaging needs. This team’s efforts can never be underestimated particularly online. It has been proved that people are more likely to buy from companies that have a solid online presence and where one can actually speak to a person before making a purchase or afterward if they need help with the product or service they bought.
Customers are reluctant to do business with companies whose online presence is almost non-existent. Failure to have an efficient retention team is what makes a lot of B2C companies fail and lose customers every day.
One of the biggest problems companies face today is trying to keep the customers they have acquired. In fact, in one of the reports from eConsultancy suggest, 70% of companies say it is much cheaper to retain customers than try to acquire new ones.
Customers are prone to change their loyalty because there are literally hundreds of companies to choose from. Competition among companies to retain their customers is fierce. Some marketing scientists argue that customer retention has received the short end of the stick for many years now, and it is only recently that people have started to realize the importance of setting up specialist teams that handle customer retention. This train of thinking has gained traction because the proof is now there that trying to acquire new customers is more expensive than focusing efforts to try and keep the ones already there.
Cross-Channels’s 2013 Marketing Report showed that 22% of companies that do not engage in any form of relationship marketing cited lack of resources as their biggest challenge. A further 19% said that lack of a clearly laid out strategy was to blame for the failure to retain customers. 13% of companies claimed they were technologically limited and hence were unable to develop any form of online customer retention strategies.
Marketing Pillar #3 Discuss Developing customers
The development team is the team that takes the data combined by the other two marketing teams and interprets it intelligently so that the other two teams know what to improve. The development team is responsible for understanding the data collected by other marketing teams; drawing up the company’s marketing analytics and giving valuable consumer insight. They are the brains behind loyalty points and promotional content.
Collecting data allows companies to monitor and track their customer’s online behavior. It can help interpret why people buy, when they buy, and what they like to buy. After the development team has interpreted the data they have collected online, they can then pass the information over to the retention team who then come up with strategies to keep customers coming back to buy online. The acquisition team can also draw useful insight from the data collected by the development team. In this way, all three teams are working hard on synergizing.
If you want your company to stay relevant in this ever-changing world, then you need to ensure that you keep your marketing teams ahead of the game. This 3 Pillar Marketing framework just may be what your company has been looking for to get it mojo back!!