senior marketers champion CLC marketing
revenue growth for companies embracing CLC
marketing leaders have mastered CLC management
As customer relationship management becomes increasingly important for businesses, mapping and aligning with the customer life cycle (CLC) is the most effective way to structure marketing efforts. Implementing the CLC on an organizational level ensures the customer vision at the moment of purchase is closely aligned with the post-purchase experience. While 87% of senior marketers endorse the CLC model, only 7% have achieved leader status in applying it.
Social media has driven business into the age of the customer, where ongoing engagement throughout the full customer journey is now necessary to achieve marketing success. From prospect through to the post-purchase stage, smart CMOs are recognizing that continuous support is necessary to drive the growth and success of their marketing efforts.
According to a recent study, companies that adopt a proactive approach to mapping the customer journey and delivering customer satisfaction at the relevant touchpoints earn 46% more revenue than their less sophisticated counterparts. Forrester have reported that 70% of surveyed marketing leaders are in the developing stages of a CLC-driven marketing strategy and execution, and only 7% of the companies surveyed had achieved ‘leader’ status in the implementation of the CLC.1
We’ve already established the importance of cross-channel social engagement in maximising customer lifetime value. Only 3% of companies are succeeding at cross-channel engagement, but this is only part of the problem. The role of social media in the CLC extends further than being a platform to deliver customer satisfaction; CMOs must grasp the full significance of social media in the customer journey – both before and after purchase – to be able to utilize CLC-driven marketing, and accelerate the growth of the business.
Understanding the purchase fantasy
To map the impact of social in the CLC marketing model, we can begin at the moment of purchase. Enticing a customer into a purchase decision involves presenting a brand promise; the customer bases their decision on a perceived idea of what the brand will deliver, and what their brand experience will be. This is the purchase fantasy. For marketers, this anticipation is a huge opportunity, but according to Jillian Falconi, VP of Demand Generation at Falcon Social, it also exposes the brand to certain risks.
“Of course it’s a huge achievement to be discovered by the right audience, and to drive that audience to purchase. However, in the age of social media, creating and promoting an enticing offer also exposes the brand to various risks. At the moment of purchase, the customer has built up a fantasy about what that product can deliver, and if marketers can’t fulfil this fantasy, we are exposed to bad reviews, complaints, and severed customer relationships.”
The significance of social media in the CLC lies in its ability to amplify any marketing investment that takes place after the moment of purchase. Social media arms each individual customer with the ability to influence any future prospects: it gives customers referral power. Any budget or resource that is allocated to improving the post-purchase experience, can be multiplied through the individual’s referral power. For Jillian, this is why strengthening the loyalty loop is key:
“This means as marketers, the budget and resources we invest in maximising a single loyalty loop, can be multiplied exponentially through one individual’s influence in the discovery mechanism that is taking place online continuously. Nowadays, the concept of a customer referral is very broad, and very public. From leaving a positive review in a public forum, to posting a picture featuring the product.”
“Nowadays, the concept of a customer referral is very broad, and very public.”
Jillian Falconi VP Demand Generation
Social media enables this discovery mechanism. If a customer’s post- purchase experience does not fulfil their purchase fantasy, they will be unlikely to act as a brand advocate on social, stunting the referral process. They may leave negative feedback in a public forum, instigating negative brand discovery. Brands must strive to align their promise with their brand reality.
Increased growth from customer loyalty
Investing in the alignment of brand promise and brand reality will increase the likelihood of customer loyalty, and is ultimately cost-effective. It is more expensive and time-consuming to measure growth simply by the acquisition of new customers, or by total market share. CMOs should instead focus on mapping the CLC and allocating budget according to the customer’s priorities in each phase of the life cycle. This will pave the way for great customer engagement, and better amplification of marketing efforts.
A recent Forrester Research report citing Fordham University’s customer relationship management strategy illustrates this growth potential. By implementing personalised engagement throughout the student journey, Fordham have increased student retention to 60%: 8% higher than the national average.2
Actioning the CLC
In my opinion, CMOs should prioritise a holistic approach to CLC-driven marketing. Social media has empowered customers, and it’s important to be aware of the impact that influence has throughout the entire marketing structure, not just its impact in social media management. When making budget decisions, consider allocating a higher investment according to most demanding phase of the life cycle, rather than by evaluating the performance of each marketing channel.
Implementing a CLC-driven marketing structure will not happen overnight, but there are steps you can take to begin angling your efforts around the journey of the empowered customer:
1. Map your customer’s life cycle
A simple task with enormous implications. Only 23% of marketing leaders succeed at ensuring their customers have a smooth transition between each phase of their life cycle, across all channels and touchpoints. By identify what each phase of your customer’s journey is, and which marketing channel is most influential within each phase, you can pivot your marketing structure to be more efficient.
2. Define your discovery mechanism
Going back to the moment of purchase, and the notion of purchase fantasy: identify what drives your customers to convert, and how to optimise for rediscovery and repeat purchase. Where the linear marketing funnel prioritises measuring new customer acquisition and conversion rate, CLC-driven measurement should focus on measuring conversions to the next life cycle phase.
3. Align resource with new model
Adjusting budget and resource allocation by life cycle phase, rather than marketing channel, will break down silos within your organisation. Encouraging teams to align across skill sets will breed a more efficient marketing structure.
1. Use The Customer Life CycleTo Power Your Transformation To Customer Obsession, Forrester Research, Inc., July 29, 2015
2. Make Customer Obsession Pay Off With The Customer Life Cycle, Forrester Research, Inc., July 29, 2015