April 1, 2018
“Growth automation”. Those not familiar with the term may recognize it better as “Marketing” automation, or as Wikipedia puts it, “software platforms designed to enable marketing departments and organizations to market more effectively on multiple online channels (e.g., email, social media, websites, etc.) and automate repetitive tasks”. We would prefer to refine that statement simply by adding that growth automation extends beyond initial customer outreach and digital ‘marketing’ to include nurturing, onboarding, support and retention tools and techniques. Automation for full digital customer engagement, over the lifetime of a relationship. And it is bringing significant change to consumer marketing behaviour.
The state of customer marketing today is weak for many organizations. Marketing teams spend their efforts optimizing email and ‘push’ notifications about products, services and online stores, while target customers are busy trying to engage on-demand over new channels.
This gap is challenging modern marketers to engage customers in more timely, individualized and ultimately, more meaningful ways. The strategy for attracting, acquiring and retaining customers must evolve, as must the tools and techniques. And that is where growth automation fits — enabling increased customer lifetime value through intelligent marketing programs that combine individualized special offers, omni-channel engagements and seamless product/service integration.
As stated, a fundamental focus of growth automation is the much-coveted higher customer “lifetime value”, or LTV. Unlike much of traditional marketing, this is about acquiring new customers with an eye set on more than the initial purchase. It is about programs that increase the amount each customer spends with the company from first acquisition through to retention and even win-back. This is not a new way to think about customers, but rather a strategy now well proven and exploited by innovative SaaS companies through to bricks-and-mortar coffee stores. The point is, for the rest of the competition, current digital marketing tools do little to help them create programs specifically for increasing customer LTV. And therein lies both need and opportunity.
There was a time when marketers might be able to think of consumers as one large group, or at worst, a small number of market ‘segments’ (e.g., small-medium-large, or male-female). This is no longer the case. Consumer access to information and choice has expanded dramatically, and so have their (in fact, ‘our’) preferences and expectations as a result. And the competition for our eyes and ears (and ultimately our wallets) has intensified to the point where we are now adept at tuning marketing messages out.
To combat such “promotion blindness”, marketing programs need to evolve, from a stream of broad messages to the creation of individualized experiences. Earlier tools and techniques were limited in their ability to segment customer databases that could make promotions and experiences individually relevant. The promise of new growth automation tools is in the application of technologies such as ‘machine learning’ and ‘AI’. Such technologies design and optimize targeted engagement programs with unique messages, offers, support and more, all based on individual customer records. This targetting enables segmentation down to the individual level.
The ability to segment customer marketing engagements down to the individual level is a dramatic step forward. Full success, however, depends on similar technological advancements in other areas of the business. For example, the Checkout and Billing systems must also keep pace.
Typical online checkout systems today can handle fairly broad “special offers”, such as discount coupons or codes for specific purchases or customer types. However, custom program development is likely required for much innovation or granularity beyond these. That currently leaves the checkout process as one of the few points of customer engagement where physical retail is still outpacing the majority of digital businesses.
Even companies that have built special offer-management platforms are still reliant on email blasts as the main means of promoting special offers, and on making these offers available generally in order to garner the most results. Unfortunately, these typically lead to a marginal spike in revenue, and in some cases can result in cannibalization of revenue from other products or programs. For example, there is little point extending an offer to customers who typically purchase at full price. Similarly, if customers are known to respond favourably only to discounts of 20%, there is little point extending 10% discounts.
The optimum way to make these programs accretive (additive) is to design and enable them on a person-by-person basis. An “ideal world” perhaps, but that is the potential of the latest growth automation – engaging all customers as individuals and presenting the right offers at the right time, maximizing customer lifetime value.
The reality today is the average customer does not want to assume much responsibility for the way in which they interact with a business (other than the use of appropriate people skills of course). They just expect it to be a smooth and successful interaction, every time. The truth for many businesses, however, is that user experience depends on the communication devices or channels used. In extreme cases, this leads companies to different loyalty programs based on customer device type. The result is fractured engagement, which is inefficient for companies, challenging for marketers, confusing or even off-putting for customers.
Omni-channel engagements ensure that customers have the same experience with marketing programs regardless of device or communication medium. They promote a more positive customer mindset about the company and the products offered, allowing them to choose when and how they interact.
The balance of power is not shifted entirely to the customer however, as the vendor is now equipped with more detail and capabilities to craft the most appropriate offer(s) to maximize returns on the engagement. A strong growth automation strategy and current tools will enable marketers and customer service personnel to create and maintain seamless customer engagements, and this will improve the ROI on the technology and program investments.
No matter the business, marketing cannot be successful without a deep understanding of how customers will use the product. This remains true, but is harder to capture and maintain, for software businesses where the majority of customer interaction with the product is done ‘virtually’, through ‘free trials’, automated demos or simple browsing sessions in an online store. In these digital engagements, enabling customers to get a real sense of the product, its features and differentiators, is critical, but it demands that the company also use online chats, support lines, referral services and other outreach tactics in order to understand and optimize the customer journey and the contribution each product touchpoint provides.
Growth automation can be integrated directly into online product experiences, enabling marketers to create programs that are triggered by or are designed to trigger extended user action based on online behaviour, transaction data and more. And these programs can be created without the need for technical or programming help. They put additional power in the hands of the marketer, and help maintain the mutually beneficial relationship between customer and vendor that is so desired in the multi-channel environment of today.
The vision for growth automation is the combination of the techniques and advancements described here in an easy-to-use, affordable software platform. Such a solution will allow marketers to engage with customers directly, individually and with more relevance than previously possible. When fully realized and delivered, it will make growth automation the most important set of consumer marketing developments in the last 20 years. We await the revolution eagerly …