A recent benchmarking report from Demand Metric on Customer Lifecycle Marketing illustrates the impact of aligning marketing efforts around a customer journey model. The report also illustrates a number of blindspots that are derailing Customer Lifecycle Marketing efforts.
The missing ingredient? Community Management.
First, highlights from the report (direct quote):
The analysis of this study’s data provides these key findings:
- The study found that less than 20% of organizations are currently marketing across the entire customer lifecycle.
- Participants spend twice as much of their marketing budgets on acquiring new customers as on retaining existing ones. (Yet most of their revenue comes from existing customers!)
- Almost 90% of the study participants indicate that marketing currently owns the understanding and management of the customer lifecycle.
- Of the lifecycle stages – Awareness, Consideration, Purchase, Retention and Advocacy – Awareness enjoys the greatest clarity of ownership, with marketing owning the stage 88% of the time. Retention is most fragmented, with few organizations defining clear ownership of this stage.
- The Awareness and Consideration stages enjoy “adequate” or “ample” levels of investment for over 70% of study participants. Retention and Advocacy both fall at the “minimal” to “none” level of funding for 55% of study participants.
- The greatest benefit to executing a customer lifecycle marketing strategy is greater customer engagement.
- The greatest challenge to marketing across the customer lifecycle is understanding customer content needs.
- 72% of strategy adherents are experiencing a revenue lift from customer lifecycle marketing.
- Over three-fourths of participants plan to increase their commitment to and investment in customer lifecycle marketing.
Clearly Customer Lifecycle Marketing is incredibly valuable when all stages of the lifecycle are addressed. So what is the problem? Based on my direct experience and years of studying the intersection of marketing and online community, I would assert that building meaningful relationships at scale is still an undeveloped function in the majority of most organizations. Further, as the data from the report shows, the “ownership” for customer retention is scattered among many departments. Add to the mix the eternal debate about “who owns social / community” and things get even more messy.
So what is a modern marketing organization to do? Consider three things:
- Community Drives Customer Lifecycle
A modern definition of online communities expands the location of “community” to be any on or offline touchpoint where customers can meet and form relationships. A modern definition also expands the concept of community management to include any form of relationship building and nurturing. Modern online communities produce a range of value for customers and businesses. Peer to peer support is the classic example, yet modern approaches include a range of deep collaboration on new product development to expansive crowdfunding campaigns – and everything in between. Community can play a valuable role in every stage of the customer lifecycle, and can often be the connective tissue to hold the entire experience together.
- Treat Engagement & Retention as a Community Management Opportunity
The practice of building and nurturing customer relationships is a job modern community managers understand very well. In particular, Community Managers can be very effective as resources in Customer Nurture campaigns during the consideration phase. I had my community management team at Autodesk reboot a nurture campaign that supported a 30 day product trial, and the results were amazing.
Further, Customer Advocacy programs grew (at least partially) out of Community Advocate / MVP programs. It is a relatively straightforward process to scale current Advocacy programs to include different customer types. There is also a massive opportunity to harmonize Influencer programs (which typically look outside of existing communities) with Advocacy programs. These are essentially two sides of the same coin – Advocates have typically been nurtured through a hosted community and Influencers have established their own communities and networks. A modern Community Manager treats these contexts as part of the larger community ecosystem.
Treating engagement and retention as a community management opportunity allows the staff with the skills to manage relationships at scale do what they do best. This is a huge missed opportunity in marketing.
- Get Real About Digital Transformation & Social Business
A modern approach to online community takes into account the entire digital ecosystem, not just single online touchpoints. A modern approach to community management nurtures engagement across the digital ecosystem. So if Community Managers know how to address the key gaps illustrated in the Demand Metric report, what’s the problem? Why isn’t it happening? There are many answers, but one factor that has had a huge negative impact is the trend of Digital Transformation initiatives absorbing (or in some cases, abandoning) Social Business efforts. I expand on (and in some ways, rant about) this in my 2015 recap post. Most Digital Transformation initiatives have focused on technology at the cost of customer engagement. Many Social Leadership teams and organizations have been disbanded or fractured and embedded to the point of being ineffective. Customer Experience initiatives often focus on superficial and in the moment customer engagements at the cost of growing the life long relationship.Bottom Line: We need a new Leadership model that addresses not only the Company : Customer relationship but also the complex network of Customer : Customers : Company relationships.
Netting it out:
- To create successful Customer Lifecycle Marketing initiatives, modern marketers must include online community and community managers.
- Community Managers can help address the current engagement and retention gaps in Customer Lifecycle Marketing programs.
- Organizations need to renew focus and investment in Online Community Leadership to drive growth via Customer Lifecycle Marketing
I am working with a portfolio of clients on evolving their community and marketing programs (lifecycle, influencer & advocacy, community management). I am also kicking off the year by offering a complimentary consultation session (for a limited time & very limited slots). If you would like to get feedback and guidance on your 2016 plans, feel free to register for a consultation here.
Our intention with holding the Marketing & Online Communities conference is to explore of the intersection of marketing and online communities. Marketing agencies and teams are playing a key role in the development of online communities, and more generally, in the use of social media. But, there are several key issues, including:
- Many marketing teams are still focused on quarterly-driven results and think in a campaign mentality, versus building long term relationships.
- Many community hosts are struggling with appropriate forms of marketing, and in developing appropriate engagement programs.
- Community members don’t want to feel manipulated or interrupted in their community experiences, and they want to have conversations, as opposed to being “talked at” by brands.
We chose our topic and speaker lineup to highlight healthy attitudes and best practices in building relationships with online communities.
Our session and breakout topics, and session leads will include:
- Designing for Conversation
Heather Gold, Subvert.com
- The Social Web: How Consumers and Brands are Connecting Online
Elisa Camahort Page – BlogHer
Kendra Bracken – Fleishman-Hillard
- Secrets of Successful Community Campaigns
Heather Lutrell – 3jane / indieclick
Belinda Lang – American Express
- Community Generated Media: Giving Customers a Voice and Companies Insight
David Rubinstein – ExpoTV
Michael Liefer – Swirl
- The Role of PR: “Public Relationships “
Brad B McCormick – Porter Novelli
- Moderating Your Brand
Mike Passcucci – Mzinga
- Brand Monitoring in A Web 2.0 World
Steve Broback – Parnassus Group
- Integrating Customer Communities in to the Marketing Mix
Peter Friedman, Moderator – LiveWorld
Again, if you would like to participate in the event, please register here: http://moc08.eventbrite.com .
If you have any questions, feel free to contact me.
The tag for the event is #moc2008
We are lining up the final speaker slots for the Marketing & Online Community conference.
We’ve added three folks this week that I am particularly excited about (ok, I’m also excited by the whole lineup).
David Dunne – Edelman
I’ve been a fan of Edelman since a former Autodesk colleague introduced me to their Trust Barometer a couple of years ago. I’m glad to have their perspective a part of the conference.
Thor Muller – Satisfaction
Satisfaction intends to turn customer support, and by extension, brand ownership on it’s ear. If you aren’t familiar with the site, check it out. It turns out our CEO Chris blogged about them several weeks ago.
Richard Weil – Cartoon Network
Richard is working on a very interesting virtual world project. I’m not sure how much I am free to say at this point… so we will just leave it as that.
It is interesting to watch traditional marketing and advertising agencies confront the power of the connected consumer. I’m very excited to get to New York and to explore this topic with the brands, agencies and communities that are coming.