Lifecycle email marketing addresses the customer at every stage of the customer lifecycle with the respective matching, individualized content that does not necessarily have to be advertising, whereby the set-up of a long-term dialogue relationship is more important than generating short-term revenue.
The aim of lifecycle email marketing is to sustainably increase customer value, as well as generating repeat purchases, on a regular basis. The so-called “customer lifetime value” is the core value that needs to be optimized steadily, which can be divided into five phases: potential, new, existing, inactive, or lost customer.
In order to classify customers into one of these stages, and be able to display each of them always the most suitable content, you need accurate information about the customer. Transaction data from the online shop reveal, for example, whether it is an existing customer, buys regularly, or an inactive customer, or has not purchased anything for a long time.
Response data from email marketing helps to optimize the content communicated, on the basis of individual customer preferences, and provides information on the phase of the customer in the customer lifecycle. While potential customers, for instance, might source and open your newsletter, they do not necessarily buy the advertised products.
Learn hereinafter, in which phases of the customer lifecycle you should use which kind if email marketing measures to achieve high conversion rates:
1. Potential customer: Potential customers have registered for your newsletter, but didn’t make a purchase, yet. At this stage, it is therefore necessary to convert the potential customer into a new customer. Since the potential client has proactively registered for your newsletter, it is very likely that he is also interested in your products, and because of the interest being particularly high at the time of the newsletter registration, you should send the potential customer immediately a welcoming email to activate him right at the beginning of the customer lifecycle. It is recommended to integrate a voucher in the welcome email, which is only valid for a short time and should be linked to a minimum order to avoid that potential customers sign up for your newsletter just for the voucher. Thus, to make sure that the voucher directly finds the proper use, you should provide the potential customers in the same mail with suitable offers.
Furthermore, it is advisable to not only send a single welcome email, but a multi-level welcome route. The contents of the welcome emails should be as exclusive as possible, including e.g. special packages for new customers only, product samples, sweepstakes, unique services, like free express delivery, etc. Design the welcome route flexibly and prepare different mail content, depending on the reaction of potential customers. A potential customer, who converts already after the first mail, should be addressed with other content via the residual welcome route, instead of like a potential customer that cannot be activated at first.
2. New customer: Even a potential customer, who has been converted to a new customer immediately at the beginning, should be taken into account in the further course of the welcome route with exclusive offers to keep his interest at a high level and to set new purchase impulses regularly. The objective is to bind the new customer long-term and to make him an existing customer. As previously mentioned, effective lifecycle email marketing requires the broadest possible consent of the customer to use his personal data. Consider, however, that most customers first of all just want to register for your newsletter. Additional questions for a consent to collect or merge data, seem daunting for many customers at this time. Instead, you should use the welcome route to ask gradually for broader consent. Keep in mind: Customers give their consent only if they gain added value, therefore, you should communicate that as precisely as possible. After the first purchase of a new customer, you should send them a thank-you mail and wish them a lot of fun with their product. Incorporate appropriate cross- and upselling offers into the thank-you message to give the new customer reasons for a subsequent purchase.
3. Existing customer: Many companies see the customer activation as the final goal and ignore the customer until he leaves them. Instead, existing customers should be consistently kept active. Make use of your information about the customer to individualize the newsletter content according to his preferences. As you gain new information with each sending, the individualization is getting more and more precise each time. In addition to the newsletter, we recommend the dispatch of standalones (single mailings) to existing customers, which are sent on special occasions, e.g. to a time-limited discount promotion or a product launch. While newsletters promote a variety of products, standalones usually focus on particular deals, hence, customization is even more important here. Just consider that even in a poorly individualized newsletter, most customers will still find attractive offers, however, if a standalone offer doesn’t fit, the mailing is completely ineffective.
4. Inactive customer: Inactive customers are all those who have not purchased for a longer period and should be reactivated with particularly exclusive, time-limited offers or discounts. The only problem is that inactive customers usually do not open such an email, therefore, reactivation has to occur with the subject line. Special and personalized subject lines, like "We miss you, Mr / Ms" can be the necessary trigger to open the email.
5. Lost customer: A customer is lost when he unsubscribes from your newsletter, which means you can’t send him any promotional emails anymore. But you can still send a confirmation of the deregistration, which you should use to express your regrets that you lost him as well as your hopes that you may soon welcome him back as a newsletter subscriber. Don’t forget to integrate a link to the new registration, in case the customer changes his mind - or may has just accidentally unsubscribed. Also recommended: A short survey to find out why the customer has left.
The CMO Council describes the problematic situation when a vendor doesn’t know his audience to the point: “Through the lens of digital channels, the view of the individual customer can be quite a bit fuzzier. The unknown digital audience sends us back into the abyss of marketing days past when we simply didn’t know what our customer was expecting or even anticipating…and personalized experiences were a far-off aspiration.” The peer powered network now tries to shed light on the issue on November 17, 2015.
You might be interested in joining the CMO Council webinar - The Lost Customer: Bridging the Gap Between The Known and Unknown – on how to gain integrated insights about individual customers.
By Daniela La Marca