CONVERSION & RETENTION IN DIGITAL MARKETING
Make Your Most Valuable Conversion
Realising the potential of repeat business, fostering lifetime value, and avoiding churn.
Marketing of consumables and services often focuses on acquiring new customers to achieve business growth. Bespoke pathways that guide new shoppers towards a single conversion point. Why then do newly acquired customers fall into generic all-customer promotional cycles?
Instead, let’s take a look at some ideas that focus on nurturing individual relationships, and why a second purchase is the key to lifetime value.
First time buyers are still only in the early stages of their relationship with a brand. The largest store of value actually lies in their future potential actions as returning purchasers. They’ll return with a higher likelihood of converting and spending more than their first purchase¹. Not only do the odds favour returning customers, they also improve further with time and purchase frequency². Brands can unlock this potential by creating relevance and establishing loyalty — all of which aims to improve the wider customer experience and encourage shopping behaviours.
Collecting & Activating Customer Data
Data assists relevance by delivering content to the right users at the right time, lifting engagement and purchase intent while supporting the wider experience. These data points enable the segmentation of larger populations to include or exclude from campaigns, show creative variants, or change the entire appearance of a website.
The power of relevant touchpoints resides in harnessing an understanding of consumer behaviours, preferences, and characteristics.
Which data should you collect then? That answer is found by working backwards from your desired application, identifying the required data points and their collection methods. This exercise will be unique to every business, and likely evolve with time. To utilise content variants focussed on sports teams for example, you’d need to know users’ preferences and take cues from expressed behaviours. Intentionally collecting this data through tracking, pop-ups, and surveys is an ongoing effort that gains strength over time.
Effective activations rely on the capacity of data management processes to reflect reality. A single view of available omnichannel data is the most reliable asset to shape experiences from. This enables dynamic pathways that cater to customer preferences and buying signals across both owned spaces and external channels. Dynamism treats customers as individuals at different stages of readiness to buy, using increased relevance to create a better overall experience and a more engaged customer.
Data can pave the way to second purchases by recognising users who:
- Have purchased once already.
- May be interested in specific complementary products.
- Show personal preferences.
- Are potential reviewers and advocates.
- Can be excluded from particular promotions or product pushes.
Fostering Consideration & Loyalty
Most importantly, maintaining relevance keeps the brand considered as a purchase option. Without it, consumers will seek and buy alternatives. The less purchases they’ve made, and the shorter the relationship with the brand, the higher their likelihood of churning.
Securing long term consideration takes planning beyond individual touchpoints and campaigns. A consistent presence beyond the initial purchase requires journeys to be mapped across channels; taking into account previous customer behaviours, fitting defined archetypes, and framed by an understanding potential lifetime value. These journeys have specific goals for customers:
- Build trust in the brand, feeling comfortable through thoughtful service.
- Remain connected to upcoming activity.
- Discover and engage with additional products and services.
- Feel valued and willing to invest their time and effort in brand experiences.
- Solidify favourable brand perceptions above that of competitors.
- Potentially cyclical peaks and troughs of engagement across seasons, product lifetimes, or service periods.
Solidifying consideration beyond the initial purchase is becoming increasingly difficult as commercial capabilities develop globally, while brands simultaneously compete heavily for new business. Offering packaged benefits through a loyalty program can provide a support framework to protect consideration, fostering it into conversion and retention. The most impactful point to nurture and convert is the second purchase. It acts as the gateway to ongoing increases in key commercial metrics, with purchase frequency and time shifting the odds of success further in the brand’s favour.
Setting Your Own Strategy:
Planning to create relevant experiences by collecting, storing, analysing, and deploying data can seem like an impossible task — especially compared to more generic approaches. However, it’s vital to long term business stability, growth, and marketing efficiencies.
- Start small, then develop complexities with time. Focus on specific groups of customers, products, and channels.
- Begin planning activations around increased relevance to groups of specific customers. Identify opportunities to further guide relevance through platform analytics.
- Seek to automate actions wherever possible. Build dynamic audiences that sync with marketing platforms. Use email flows to facilitate service and encourage repeat visits. Employ machine learning offerings to further empower efficiencies within segments.
- Carefully scope profile data points and methods of collection based on what’s important to creating relevant experiences. Use a combination of stated preferences and expressed behaviours as value rich sources.
- Work towards building a single source of truth for customer data management. Explore the potential to integrate with external marketing platforms, empower service teams, provide business insights, and consolidate a view of all customer behaviour. Likewise, the costs and complexities involved with business growth.
- Gather deeper information from customers who purchase, return to buy again, or lapse. Deciphering what it is that’s driving their behaviour is essential to pursuing transactions and preventing churn.
- Take time to assess and roadmap developments at regular intervals as business needs and platform capabilities expand over time.
Nurturing consideration and loyalty will provide a foundation from which lifetime value can be realised. This facilitates critical second purchases, leading to increasingly valuable conversions with time.
- Map extended customer journeys that develop through stages of loyalty and achieve defined objectives over time. Cater pathways to customer archetypes, varying objectives, and brand nuances.
- Dedicate specific focus to overcoming the challenge of securing the second purchase. Test and refine iterations of this setup.
- Consider whether to offer a subscription model that delivers ongoing convenience to customers, revenue to your business, and protection for buyer consideration from rival brands.
- Design a loyalty program to house ongoing customer journeys. Avoid overly complex activations or structures that could hinder signups. Consider any impacts on the wider customer experience and business costs.
- Inject loyalty touchpoints throughout retail and service interactions; taking care to ensure that customers are aware of, and engaged with the offering.
- Deliver on loyalty promises communicated to members. Fulfilled promises and surprise perks will help reinforce shopper consideration long term.
- Leverage the power of loyalty program data. Aim to improve marketing efficiency, brand relevance to customers, and deliver business insights.
The path to realising value beyond a single purchase involves careful planning and time to carry out effectively. It requires the collection and application of data, the capacity to manage multiple platforms, and a strong understanding of consumer behaviour. Beyond a framework for developing customer journeys, this approach is a mindset. It should influence the way brands treat the delivery of experiences — as the foundation to unlocking stores of value over time, not standalone transactions.
Remember the importance of the second purchase. Build on pre-existing customer trust and brand awareness using owned data. Create relevant interactions that foster consideration and purchase intent. Capitalise on favourable odds to unlock further potential lifetime value.
Thank you for taking the time to read this article. I hope it gives you something to consider in shaping your own marketing and customer experience. If you would like to discuss any parts further, please feel free to contact me via my website or LinkedIn.
Enjoyed this article? Try Part 1 in the “Why Do We Buy?” series.
Citations:
[1] Smile.io. (January 21, 2020). What is a Repeat Customer and Why are they Profitable?
[2] Bain & Company. (April 01, 2000). The Value of Online Customer Loyalty and How You Can Capture It.
