May 11, 2009
Economic uncertainty breeds insecurity and marketing is increasingly made to work more effectively, and with greater efficiency. Over the past couple of years, email has become a force to be reckoned with in B2B marketing. It is increasingly, becoming a must have tool for businesses across every sector - with the emphasis for most businesses being focused on expanding customer bases and keeping existing customers close.
In this article we compare the two dominant trends within email marketing: email for acquisition and email for retention. We look at which you should be doing at what stage and strategies to manage both.
In many ways, acquisition is the most critical and challenging activity any business can undertake. It is a vital process for any new business but also a strategy that every ambitious business should re-address on a cyclical basis.
In the context of planning an email strategy for acquisition, most businesses we talk to feel that they are clear about the campaign objective – a successful campaign is one that results in new customers. In fact the nitty-gritty of planning such a campaign usually throws up a whole series of questions and most people find that goal setting and planning isn’t quite as simple as they’d first thought.
Perhaps that’s why so many business owners find that they are frustrated with the results. It is absolutely crucial that everyone involved in a campaign understands the minutiae of the planning; setting clear and achievable targets that give everyone’s expectations a better chance of being met.
Although the end goal - more new customers - may seem simple, how and at what point this is achieved can be something of a grey area. It is important that everyone involved in the campaign agrees success criteria. Is acquisition for example defined as the first purchase or does it occur prior to that?
Bearing in mind that most B2B campaigns need to take place over a period of time and the more complex the product the longer this process will take, many marketers choose a discrete interaction as the success criteria. For example a pre-registration, request for a white paper or an enquiry may all be seen as successful interactions that result in qualified leads that can be passed on to the sales team. The criteria of this campaign would then be measured in the number of potential customers that have expressed an interest rather than the number actually making a purchase.
The first stage in an acquisition campaign is finding the names of potential customers and their email addresses. There are a number of approaches that can be adopted, some more successful than others.
Many companies choose to purchase lists of email addresses from list brokers, which can be problematic - many of these lists have been plundered by other companies before and email addresses spammed. It may be better to build an in-house list working from old sales contacts that have not been used for a time, or to purchase a highly targeted telemarketing list and call for the email addresses.
A telesales campaign is often the most effective way to obtain email addresses and permission. If you do decide to use a list broker then make certain they understand your target market, short-term marketing objectives and longer-term business strategy.
Once you have a list, the next stage is to plan your campaign. These two stages – the quality of the list and tightness of the campaign plan, are the keys to determining the successful outcome of the campaign. It is worth spending time building a detailed plan. With careful planning there is less chance of any potential slipping through the net once the initial message is delivered and the pressure is on.
The first step is to plan a message that is likely to trigger a high level of response. The object here is to think of something that the target market will highly prize, an informative and well written White Paper for example, and an enticing, highly personalised message to accompany it. The second step is to test this message, and a couple of variants, to a small group and monitor the response. This will ensure that the most relevant message is used as the basis for the campaign itself.
Although most businesses need to acquire new customers from time to time, every business needs to keep customers loyal. Far too many companies are failing to leverage customer relationships, rewarding new customers but forgetting their loyal customer base.
This is despite the fact that customer retention is not only easier to achieve than customer acquisition, but is also more cost effective. Repeat customers spend, on average, 67% more than a new customer whilst retaining a customer costs 5 to 10 times less than acquiring one (Bain & Co, 2002). The figures speak for themselves.
Analysing customer lists and any data you hold about the history of their relationship with you should be the starting point for a retention campaign. This data may be spread across disparate systems, such as the accounts package and CRM programme.
It is worth the effort collating all available information - the more knowledge you have about your customers the better the campaign you can run. Once you have an up to date customer list, divide it into segments. How you choose to group them will depend on your business, but typical segmentation would involve dividing customers according to buying patterns or length of time since their last purchase. The profiles of these groups will provide the basis for your campaign planning. More information about how to use data to build customer profiles can be found in our article Email Profiles.
Just as with an acquisition campaign, it is important to establish success criteria for your retention campaign before you begin the planning. Criteria will vary depending on what business you are in and how close you already are to achieving them. If you have little or no previous contact, then the objective of your campaign in the first instance may be simply to raise awareness and gain attention.
One way to achieve this would be to send a highly personalised email, from an account manager if applicable, thanking them for their past custom and linking to an item of interest, for example sign up to a newsletter, or White Paper.
If on the other hand, your account team communicates regularly with customers but rarely takes the opportunity to cross or up-sell them - then additional sales might be your desired outcome. It is particularly important in this instance that emails are personal and highly personalised. The last thing you want to do is damage a good relationship with an ill-thought out email that is perceived as spam. Bear in mind however, that few customers will appreciate, or respond to, emails that are blatant selling opportunities. Few of us like to be sold to – instead we prefer to make informed, self-guided choices at our own pace.
Informative marketing is the best way to communicate with customers on a level they are likely to welcome. Most customers do want information, it’s just that they are selective about what they retain. Newsletters are an excellent way to feed valuable information to customers whilst walking them through a sales process. Newsletters need to be at least 80% informative.
The goal is to create something that your customers will come to regard as indispensable. If you do not feel that you have the capabilities to produce an informative newsletter on a regular basis, then it is worth considering adding articles and contributions from third party outside experts.
Just as with acquisition campaigns it is important to plan and manage responses to your retention campaign. It is crucial that the contact is sustained if you are going to achieve your goals. A one off newsletter with no opportunity for customers to give feedback will have minimal impact – in fact it’s really not worth bothering at all. Consideration must be given to every possible response you might receive, both positive and negative, and to bounces and unsubscribe requests.
Once a pioneering medium, email is now the communications method of choice in business. It is the ideal tool for building existing relationships and initiating new ones. Whether you want to acquire new customers at minimal cost or achieve more profitable relationships with existing ones, email is undoubtedly the way to go.
If you would like further information, please email [email protected] or call 0161 817 2929
Posted by Paul Latham
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