How do we stop customers going dark?

One-to-one marketing may be much talked about, but many marketers are failing with this in practice, writes Charles Nicholls, senior vice president of product strategy of hybris software and SAP CEC (customer engagement & commerce). Here he explains the three reasons he believes many are struggling to keep customers engaged.

Marketers have been strategising about one-to-one marketing forever. But lots of talk doesn’t necessarily mean lots of action, and there’s little one-to-one marketing actually happening in Australia. By contrast there’s lots of bulk marketing, without much thought about the relevance of the message, or the impact on customers, who are increasingly intolerant of irrelevant marketing.

So we can be in no doubt that marketing has a big problem. Marketers are increasingly worried about so many customers going ‘dark’ and disconnecting from their brand.

Ironically, marketers are of course consumers themselves, and personally feel the barrage that their industry inflicts on consumers on a daily basis. At a recent conference I did a show of hands among the marketing audience, and asked if anyone had unsubscribed or blocked any marketing communications in the last week. No surprise, marketers are ‘delisting’ themselves just as fast as everyone else!

Email marketers are acutely aware that their next email could be the one that causes an unsubscribe, where the customer goes dark for good, beyond reach, on the growing list of unsubscribes.

Advertising professionals are also aware of the problem, putting in place simple frequency caps when advertisement effectiveness begins to tail off. However, in advertising, frequency caps are typically used to manage ROI, not because it impacts the customer experience. For example, retargeted advertising often follows you around the web often for months with marketing that is simply no longer relevant. The longer term effect of this is significant – the display medium is relegated into irrelevant noise which is automatically ignored, often referred to as ‘banner blindness’.

So why is it that marketers, so aware of the problem both personally and professionally, continue to bombard customers with largely irrelevant marketing? There are three primary reasons:

1. Product centric business models

Many businesses are fundamentally product centred, not customer centred. The way that new products are conceived, built, and promoted is based on achieving internal quarterly sales goals driving a focus on product centred marketing.  This leads the marketing team to promote specifically what the company needs to sell, not necessarily what the customer needs or wants to buy. Customer-centric marketing is fundamentally different in that it is focused on customer needs, and solving customer problems, and in doing so drives revenues and margins for the business.

2. Bombarding customers is easy, being relevant isn’t

Marketing automation tools are at the same time both ‘too easy’ and ‘too hard.’ The ‘too easy’ part is that it’s too simple to send a marketing barrage out to customers and accept that a 2% conversion rate on, say, email, is good. What about the impact on the 98% that didn’t convert? The ‘too hard’ part is that many marketers struggle with getting the campaigns out at the rate that the business demands. Think of any number of major retailers sending five or more emails per week in addition to promoting through different marketing channels at the same time. Simply getting this volume of campaigns out effectively every week is a massive task, which often means that the extra effort required to target messages more precisely gets forgotten. Many marketers feel like they are on a treadmill, doing the ‘wrong’ thing but while it continues to drive sales it’s hard to stop, because the next campaign is already overdue…

3. Marketing programs don’t work in a vacuum

Most businesses run marketing as a series of semi-independent channels: with separate teams for email, direct response advertising, brand, mobile, in-store, call centre and so on. What hope is there for coordination across touch points? Yet CMOs know that marketing has a cumulative impact: brand advertising will impact responses in other channels. Email impacts calls in the call centre and so on. Most marketing case studies look as the positive effects of running coordinated messaging across channels – effectively showing that messages repeated across channels create a multiplier effect. However, in order to really understand these effects, you need also to look to the negative impacts, where in some cases doing more marketing suppresses sales and causes customers to delist. Understanding this means that marketers need to measure cross channel effects in order to understand the true impact they are having on their customers. Measuring the combined effects of different campaigns is much harder, but is critical because when customers unsubscribe from a brand, they almost always unsubscribe from everything, across all channels.

The challenge

To tackle these three problems is pressing for most Australian and global CMOs, and at the heart is the tricky problem of data. Fundamentally we need to change the way that we think about marketing: marketing needs to become experience based. Experience based marketing puts the customer first, recognising that our brand needs to offer a delightful experience – and that the way that we communicate with customers is fundamentally part of the brand experience.

In order to achieve this, we have to understand each customer’s current context – what they are engaged with at this moment in time – across channels. Without this data, we cannot ever hope to be relevant, and more and more consumers will delist and go dark.

Getting a real time 360-degree view of customers in one place is the start of nailing some of these persistent problems. It means understanding customers all the way from the first touch as an anonymous visitor through to a well-known customer identified with multiple emails, devices, social and cookie identifiers. This gives a solid data foundation for marketing to measure the impact of what works, and critically what doesn’t, causing customers to go dark. It also gives marketers the data required to be relevant.

Until we tackle the data issue, customers will checkout of our brand communications in increasing numbers. It’s time to start thinking differently about the way we market: putting customers first, to create genuinely engaging and interesting experiences which captivate customer attention and build the brand.