Post on 14-Jan-2015
description
transcript
Contact: Dave Ury, dave@lifecyclemarketing.net
Customer Insight & Lifecycle Marketing
Confidential and Proprietary
Customer Insight & Lifecycle Marketing
Overview 3
Customer Intelligence 7
Strategic Alignment 11
Lifecycle Marketing 14
Conclusion 20
Recommendations 21
Appendix 22
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 2
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 3
Digital subscriptions and memberships present an exciting
opportunity to build lasting, profitable relationships with
consumers
But the business model has inherent challenges:
Fast changing, competitive environment
Easy come, easy go nature of digital memberships
Lack of communication reach and frequency
Thus, lower customer engagement, loyalty and lifetime value
(LTV) are often a strategic problem
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 4
Alig
nm
en
t • Conflicting Objectives: e.g. customer acquisition impact on churn
• Insight is gathered but not leveraged
• Extraordinary investments may be needed
Measu
rem
en
t • Difficulty benchmarking or testing
• Limited access to product usage data
• Time lag between execution and measurable results
Assu
mption
s • Service is accessible and performing well
• Service has high mind-share or engagement
• Low usage is just a feature awareness issue
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 5
To maximize customer LTV, digital subscription businesses need
a comprehensive loyalty strategy encompassing:
1. Customer Intelligence = Behavior, Attitude, Demographics
2. Strategic Alignment = Right Customer, Right Product
3. Lifecycle Marketing = Execution of Customer Treatment Strategy
The good news is that these essential components can be
managed in parallel to some degree, and frequently there are
quick wins to be found
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 6
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 7
Customer value should drive priority, while all metrics should
inform product planning and customer treatment strategy
Metric Description and Examples
Customer
Value
Define what each customer is worth in terms of profits to the
company. Commonly defined as LTV. Your customer base is
your most valuable asset, what is the asset worth?
Behavior
Buying: Purchasing additional products, subscription renewals
Product Use: Range and frequency of product feature and
content use
Advocacy: Sharing/recommending to friends
Attitude/
Perception
Customer Feedback. What features and attributes matter the
most? Would they recommend to a friend? Why do they stop
buying?
Performance Service delivery. Uptime, outages, etc.
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 8
Attrition by Cohorts Average Lifetime by Sales Source
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 9
6 6.5 7 7.5 8 8.5 9
Referrals
Website
Paid Search
Affiliates
Average Lifetime Duration (subscription in months)
0
10
20
30
40
50
60
70
80
90
100
1 2 3 4 5 6 7
Subscriber Attrition by Tenure (subscription in months)
Jan Sign-ups
Feb Sign-ups
March Sign-ups
Interactions Profile Update
Confidential and Proprietary
Customer Insight & Lifecycle Marketing
Communication
10
- Website Visits
- Membership Log-ins
- Content Use
- Purchases
- Campaign Response
- Customer Support
- Record at Individual-Level
- Enhance with Predictive Modeling, Segmentation, etc.
- Event-Based Messages
- Alerts
- Offers
- Recommendations
- Customized UI
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 11
Right Customer
Understand the profile and needs of happy, high-value customers
Right Message
Relevant to high-value prospects and customers
Right Product
Match the needs of high-value customers
Customer loyalty and the
resulting profitable
relationships are all about
delivering a great fit
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 12
Executive Provide oversight and maintain program priority
Marketing
Product Management: Product matches needs of target customer
Customer Acquisition: Target consumers and channels that return profitable customers
CRM: Targeted treatment designed to engage users, provide support, and reinforce sale(s)
IT
Integrate rich customer data with tools that support
analysis and targeted
communication
Staff and align around a clear loyalty strategy because
“everything affects churn”
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 13
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 14
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 15
Management of the customer relationship should be needs-based,
and oriented around lifecycle phases
Onboarding
Habituate & Expand Relationship
Re-engage or Save
Customer Engagement
& Profitability
Customer Tenure
Objectives: Deliver the product, maintain excitement, provide
orientation
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 16
Event Description and Notes
Purchase Flow Simple, quick, and reinforce the sale
Order Confirmation
and Welcome
Single, comprehensive message confirming status and
providing recommendations on what to do next
Product Delivery and
Access
User’s first engagement with product. Track
“conversion” from sale to first use, performance
perceptions
User Guide, Tutorials
and Support
Make support easy to find. Show user how to get the
best value, even if UI is highly intuitive
Free Trial Conversion Timely and relevant upsell for free trial users. Test to
determine optimum timing, message, and medium
Objectives: Make product part of customer’s routine and expand
use. Facilitate loyalty, additional purchase and advocacy
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 17
Event/Touch Point Description and Notes
Updates, News,
Alerts
Maximize awareness of new features, content or other
“news”. Communicate with targeted, relevant message
based on explicit or implicit interests
Tips and
Recommendations
Increase user’s perceived value of the product by
introducing/promoting features they haven’t used
X-Sell, Up-Sell
Once value has been established at initial service bundle,
encourage user to expand the relationship with relevant
offer
Encourage and
Reward Advocacy
Make it easy to share with friends, and motivate customers
for doing so with rewards, a better user experience, etc.
Objectives: Re-engage customer, problem resolution, billing
optimization. Manage voluntary and involuntary churn
Event/Touch
Point
Description and Notes
Payment
Processing
For auto-renewals, billing optimization can be an easier
opportunity because it’s often just back-end processes changes
Customer
Support
Could apply at any point in lifecycle, although most contacts
occur when customer has an issue and is at-risk of cancelling
Proactive
Outreach
Infrequent or dormant users are usually at-risk. Communicate
high value features and relevant content
Cancellation
Requests
“Save” customer by uncovering the issue and offering a solution.
Manage through self-help or customer care agent
Renewal Notice Proactive reminder when customer must actively renew
Win-Back Targeted renewal offer to high-value, former customers
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 18
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 19
No gimmicks required to increase customer LTV, just some
basic principles:
Targeted customer selection
Product designed to fit the target customer
Relevant, timely communication and treatment
Product meets performance expectation
Benchmark and track progress
The customer relationship develops and loyalty/profitability is
earned over time
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 20
Increase customer loyalty and LTV with a strategic
commitment and programmatic approach
Next Steps:
1. SOW - Deliver a specific, time-bound project description
2. Audit - Complete a customer experience and cross-functional
audit to identify and prioritize opportunities
3. Review - Review audit findings with management team to
confirm priorities
4. Execution and Measurement - Yielding positive results and
additional learning
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 21
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 22
Situation: To better understand the drivers of early subscriber churn
at RealNeworks, we examined account sign-in data. We discovered
that many former customers had never signed-in to access their
subscription during their entire tenure.
Treatment Strategy: Proactively contacted these “orphaned”
customers via email and offered help with account access.
Execution: Designed a series of tests covering email subject line
and content, and landing page content. Also presented alternative
content and treatment if customer had installed software client or
not. All tests were compared against control cell which received no
treatment.
Results: Winning test combination increased first-time sign-in by
46% and reduced 90 day attrition by 6% over control cell.
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 23
Situation: Using web surveys at TeleNav, we identified key product
features that were strong drivers of customer satisfaction, yet a large
share of users were not aware of these features.
Treatment Strategy: In addition to increasing visibility of these
features throughout the customer lifecycle, we initiated a monthly
email newsletter focused on the satisfaction-drivers.
Execution: Each edition of the newsletter focused on a single
feature, highlighting use cases and benefits. To determine any
change in behavior, a series of four newsletters were sent to a test
cell, while a control cell didn’t receive the recurring campaign.
Results: After 4 months, the test cell receiving the monthly
newsletter had 27% lower attrition than the control cell.
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 24
Situation: Significant churn at RealNeworks was caused by
subscriber's credit cards failing to authorize and settle during
automated billing . While the billing success rate was already
relatively high, we determined that even small improvements could
yield meaningful revenue.
Treatment Strategy: Focused on testing and optimizing back-end
billing processes.
Execution: Tested and carefully measured any lift from
reconfiguring the timing and number of “recycling” attempts on failed
credit cards. Applied several other process changes identified with
the help of our payment processor, testing each in isolation.
Results: Reduced monthly customer churn by .5%, and yielded
$600k/yr incremental lifetime revenue.
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 25
Situation: Based on primary research and customer support
feedback at TeleNav, we identified issues with on-boarding, product
feature awareness and on-going support for small and medium
business customers.
Treatment Strategy: Created a more robust CRM program. Helped
customers get needed support and maximum value.
Execution: Deployed a series of new treatments including website
knowledge base, welcome email, new user activation guide, and
tutorial videos. Initiated new order status reports to carrier partners,
working with them to improve order processing success and
expedite timing from order placement to fulfillment.
Results: Increased top-box customer satisfaction rating 32% yr/yr
and reduced contact center call volume by 15%.
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 26
Situation: At RealNetworks, there were a broad set of factors
influencing customer churn, as well as significant resource and
organizational hurdles affecting our ability to manage it.
Treatment Strategy: Addressed customer churn as strategic
problem.
Execution: Built cross-functional team with performance goals tied
to customer loyalty. Segmented customers by behavioral and
attitudinal data, creating a profile of our high-value target customer.
Used same data to identify satisfaction drivers.
Results: Delivered loyalty “blueprint” including full-year budget for
cross-functional team. Gained support for key initiatives including:
email platform, data warehouse, music recommendation engine,
revised acquisition strategy, shift to agile development and improved
product performance, and range of relationship marketing programs.
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 27
Dave Ury is Marketing Director and Principal of Customer Insight & Lifecycle
Marketing. He is an accomplished leader offering over 20 years of proven success in relationship marketing including acquisition, CRM, and retention.
Dave has successfully led national marketing efforts and cross-functional teams for large brands including Cox Communications, AT&T Broadband and
RealNetworks. Clients include Cricket Wireless, Allrecipes, Smilebox and WhitePages. He earned his B.A. in Business Economics from the University of California, Santa Barbara, and his M.B.A. from the University of Colorado.
Dave can be reached at dave@lifecyclemarketing.net, or 425-999-7548
Confidential and Proprietary
Customer Insight & Lifecycle Marketing 28