Are you responding to today’s trends in order to improve your retention efforts? Or are you sticking with one-sided channels and impersonal communication hoping your customers will stick around?
Marketing is all about responding to trends: Changes in customer behavior. Changes in data collection. Changes in technology. Changes in budgets and resources. Given today’s trends, being able to effectively ensure that customers continue to engage with your brand will require a renewed focus on retention.
Retention marketing is more important than ever. Here are five trends that are shaping marketing efforts today and how to leverage those trends to improve your impact and LTV.
Trend 1: Growth at all costs is dead. Efficiency is the focus.
“Growth at all costs” might be a fine idea in a different economy. But with limited budgets and resources, organizations today are leaving behind “growth at all costs” for efficiency. When it comes to doing more with less, marketing teams simply don’t have the luxury of launching an infinite number of campaigns and seeing what makes an impact. This is why marketing teams today are shifting their focus to retention.
Retention efforts do pay off. In our recent report on the “State of B2C Customer Retention,” 59% say returning customers constitute a quarter to half of the company’s revenue. And keeping current customers and growing their LTV is much cheaper than acquiring new customers.
Respond to this trend by making retention the core of your strategy. Adjust your priorities to focus on your retention efforts, and evaluate approaches and channels that will make these efforts more impactful. Share your findings and KPIs widely to demonstrate your efforts and create more buy-in across your organization.
Trend 2: Traditional channels are in decline. Time to find new channels.
Marketing efforts need to respond to constantly shifting customer behavior and new technologies. Marketers today are seeing channels that once produced results in decline. It’s a challenge to catch a customer’s attention in busy newsfeeds. Customers have become immune to display ads. Inboxes are becoming cluttered. And customers are looking for more relational, personalized ways to connect with brands — not one-way display ads and emails.
If your channels are in decline, it’s time to find new ones to add to your mix. Instead of relying on one-sided channels like email blasts, look to channels that offer two-way communication so that you can talk with your customer, not at them. Social media platforms and messaging apps give you access to invite your customers into a conversation with your brand and actually get to know them. Look for channels where your customers already spend their time each day and meet them there as well — not channels you want to work.
Trend 3: Customer expectations are higher than ever. One-to-one personalization is a must.
Customers have high expectations for the brands they interact with today. 71% of consumers expect that a brand will offer them a personalized experience. And 66% of consumers expect brands to understand their unique needs. This means that they want to be engaged with as individuals rather than as members of an anonymous segment. If customers have high expectations around engagement and personalization, how can you meet them?
It’s all about increasing personalization. Traditional methods of one-to-many marketing efforts, like email blasts or display ads, aren’t connecting with customers as individuals. Neither are using third-party platforms and anonymized data that create more of a black box than a relationship. Create those personalized experiences through channels that offer two-way interactions with customers, like through messaging apps.
Inviting a customer into a private, one-on-one conversation is a highly personalized and unique experience. You can learn more about the customer, ask them questions, and guide them to products and services that they really want. This type of personalization is easy to scale as well. Simply use responsive chatbots powered with generative AI to guide the conversations anytime, anywhere.
Trend 4: Data privacy is changing traditional marketing. Focus on declared data instead.
One of the biggest trends impacting marketers today is the rise in data privacy regulations. This change in behavior has led to more protections for customers online, but it’s also made it much harder for marketers to gather third-party data on their customers.
In the face of increasing data privacy laws, marketers need to adapt and find new ways to get to know their customer. The best way to do this is to collect data about them directly from them. This can be done easily through a privacy-safe conversation on a messaging app or through a social media direct message. The information they declare to you is yours to keep and use to create those personalized experiences for them.
Trend 5: Zero- and first-party data helps you know your customers. This is the foundation for growth.
More marketers today are realizing the benefits that zero- and first-party data can bring them. This means increasing your initiatives that get you to truly interact one-on-one with your customers. They’re not an anonymous part of a behavioral-based segment. They’re not a passive viewer of an ad or an email. They’re not a number in an audience. They’re a name and a conversation.
Investing in methods to collect zero- and first-party data requires investing in ways to really understand your customer. And really understanding your customers gives you a competitive advantage. Competitors who are targeting anonymous audiences through one-sided channels won’t be able to compete against a business who knows how, when, and why their customers buy, and who can deliver relevant and timely content to them tailored to their interests and needs.
Better Retention By Following the Trends
Effective marketing is all about responding to changing behaviors, channels, and trends. Taking action in your retention efforts by leveraging messaging and two-way communication will keep your customers feeling like they’re being communicated with as a human and keep them coming back.