Using E-mail to Drive the Customer Lifecycle

Sep 29, 2008 7:38 PM  By

E-mail programs can play a significant role in nurturing customer relationships from the moment someone becomes aware of your brand. A critical factor in making those e-mails relevant is the customer’s place in the lifecycle continuum.

Lifecycle management is an effective way to strengthen your brand, foster customer loyalty, generate more revenue and ultimately, recruit customers as ambassadors to your company and its products.

There are two lifecycles simultaneously at play in lifecycle management: the lifecycle of a product or service and the customer lifecycle. And, there are many categories of messages that make up lifecycle management campaigns, all with distinct goals. For our purposes, let’s focus on the customer lifecycle, which is most frequently made up of five core stages: new customer; multiple purchaser; loyal customer; ambassador; and the dormant or lost customer.

Here are some examples of proven programs that specifically map to each stage.

Welcome programs
At the most basic level, you can begin engaging a new customer through a welcome program. For example, after a customer makes an initial purchase, send an e-mail in follow-up that welcomes him “to the club,” activates his account, thanks him for selecting your product or service and provides information on how he can contact you for customer service. You can also request preference data or alert him to helpful information on your Web site.

First-time buyer programs
A good customer is a repeat customer. If you can drive a second purchase within a certain period of time, particularly the first 30 days, the lifetime value of that customer (and likelihood of ongoing purchases and loyalty) will increase significantly. First-time buyer programs give you an opportunity to entice new customers to make another purchase. For example, you could recommend to a customer who just bought running shoes that he next buy the latest in high-performance runner’s apparel. Or, you could provide him with an incentive (i.e., discount, free product) to purchase something inside of 30 days. The key is reaching out to customers consistently, maybe even daily, with relevant messaging.

Loyalty programs
If a customer has purchased products or services from you multiple times, it is a logical next step to further cultivate your relationship with them and work to strengthen their loyalty to your brand. One of the best ways to achieve that is by rewarding them. Offer points for every dollar spent or for every purchase, which can be redeemed for discounts or free merchandise. With loyalty programs you’re applying one of the most basic principles of psychology – rewarding a customer for a certain behavior in a way that will encourage and continue that behavior.

Once you’ve firmly established loyalty, you can often successfully convert a customer into an ambassador for your brand, and that’s viral marketing in its truest form.

Ambassador programs
The desired end game for most companies is to evolve a customer into the ambassador stage. To do this, you must create programs that will engage those ambassadors, continue to provide them with measurable benefits and enhance their positive feelings about your products and services. For example, send e-mail inviting a customer to publicly comment about your product and maybe feature her “review” on your site. You could also supply her with a 30% discount off her next purchase and a 25% discount for her friends. Many companies also invite their most loyal customers and ambassadors to special events where they can get VIP seating, receive free gifts and/or enjoy top-notch entertainment.

Re-activation programs
You certainly don’t want to “graduate” customers to dormancy status, so put a program into place that strives to re-engage non-responders. Try to capture a customer’s attention with a catchy subject line, such as “we’ve missed you” or “where have you been?, and remind them about your products and services. Often a simple reminder can jar a customer into activity. Of course, you can also present them with a special offer good for a defined period of time, such as 10 days, two weeks or 30 days.

If there’s no response to your offer, explore other communication channels to reach that customer. Non-responders aren’t valuable to you, so you may be better served to stop e-mailing them and focus on more actively engaged customers.

You can’t win ‘em all
Although lifecycle management programs can be very productive, in some cases, a customer may still decide to unsubscribe. Try to think of unsubscribe requests not as failures, but opportunities for improvement. Find out what you could have done better by including optional questions, or even a short survey on your unsubscribe confirmation landing page. For example, ask your customers if they were receiving e-mail too frequently, whether the content was relevant or not, or if your messages weren’t rendering properly. This insight can help you to improve the relevance and effectiveness of your communication with existing customers and prospects moving forward.

Ben Ardito (bardito@e-dialog.com) is vice president of professional services at e-Dialog.

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