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4 Steps to Realizing the Promise of Customer-Centric Marketing
Focus on your customers' lifetime value.
Posted Jun 13, 2014
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The meaning of the term "customer-centric marketing" might seem obvious—isn't all marketing centered on the customer? But true customer-centric marketing is a big shift from how many organizations run their marketing programs and measure success. It changes the focus of analysis and decision-making from products, channels, and site events to looking at customers themselves.

What does that mean in practice?

CMOs are looking to answer such key questions as "How do I know which customers will be most valuable? Where can I find more customers like them? How can I grow the number of those great customers shopping with me? And how can I better retain them once they've made a purchase?"

Implementing Customer-Centric Marketing

Following are the four steps required for an organization to implement and execute customer-centric marketing:

  1. Aggregating data. You need to have all available customer information in one place to achieve a unified view of each customer and to enable data analysis. Think "single view of the customer" rather than needing to bounce between services and databases to get the info you need.
  2. Generating customer insights. Your goal is to leverage predictive analytics and behavioral segmentation to derive deep insights about individuals and customer segments. Your analysis looks for meaningful ways to group customers and, with sound data science, predict which individuals or groups will be most valuable for your company going forward.
  3. Making insights accessible. The most profound insights are worthless if they are not accessible. Share them with the entire marketing team via an intuitive interface, and make them available to any other applicable area (marketing, Web team, customer service) via an application programming interface. Examples include email marketing software, advertising platforms such as Google AdWords and Facebook, and even on-site integration via recommendations and personalization.
  4. Experimenting and optimizing for the right KPIs. Experiment with various marketing tactics across each customer segment, and optimize critical customer-centric key performance indicators (KPIs). This is where a rigorous system of testing will reap great rewards. It's also vital that your organization is able to unite behind customer-centric measures of success, such as customer lifetime value (CLV) and customer equity.

Getting to Customer-Centric Marketing: A Real-Life Example

For illustration's sake, a shortened version of a customer-centric process for acquisition might look like this:

You pull your customer, marketing, and other relevant data into one place. Then you run a deep customer analysis and find one group of high-CLV customers consists of young and middle-aged women from big, Midwestern cities who tend to buy high-end steak knives as their first purchase. These customers often find you through your relatively cheap Facebook ad buys and from search keywords such as "killer steaks" and "sharp knives."

As a result, you begin to invest more in these different channels, try new geographic and demographic targeting, and test new ads and ad types against each other. Meanwhile you make sure that these newly acquired customers' purchases are in line with what you'd expect from your original group of high-value customers. You then look to repeat what works well, and continually repeat this optimization process for all aspects of customer acquisition and retention, always focusing on the CLV of new customers.

This is a simplified example, but it showcases some key distinctions between customer-centric marketing and more traditional approaches. With customer-centric marketing, you are not using absolute conversion rates for the various channels as a measure of success—it's not about driving the greatest amount of purchases right now (and you're not worried about clicks or engagement numbers). It's about getting more of the customers who have the highest customer lifetime value—i.e., the right kinds of customers, ones who are likely to make more purchases in the future or buy big-ticket items now.

Changing Environment

It's important to keep in mind that customer-centric marketing is a continuing process—you need to commit to and trust the process to reap the benefits. Market environment, competition, and customers are all constantly adapting, and this sort of iterative mentality is a big advantage.

Being customer-centric means keeping pace with customers, and testing new trends, topics, and segments to improve on key performance indicators such as customer lifetime value. Doing this well requires a seamless process from data analysis to execution to automation, and it's something that never stops.


Kyle Shepherd is a marketing manager at Custora, a customer-centric marketing platform that helps e-commerce retailers find and retain high-value customers.


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