We’ve all heard of the term ‘lifecycle marketing’ – but what does it really mean?
Well, lifecycle marketing refers to a strategy where brands guide potential prospects/customers from their first/nth interaction, to purchase/repurchase and beyond. This means tailoring messages for different points of the journey to ensure we’re speaking to the exact pain points of the prospect/customer, raising the likelihood of them making that conversion.
However, most brands stop at the ‘consideration’ segment above – seeing it as a win when new users make that first purchase, but not putting in much effort after that. This means they’ve paid for the most expensive part of the funnel (ie. acquisition), and are depending on banking on their razor thin margins, META’s evolving algorithms and the largely ‘unchanging world’ to drive a profitable business.
Not the best idea…
At Chronos, we focus heavily not only on acquisition, but also driving repeat purchases that fatten margins, giving the brand more wiggle room to grow and scale profitably. When done right, we’ve seen brands achieve up to 40x ROI for their efforts, which frankly, isn’t too bad.
There’s three main parts of the funnel that we look at:
1) Consideration
2) Conversion
3) Retention
Consideration
This is typically when a customer visits your site, whether it’s because they saw an ad, were referred to by their friends, or in the market for something for their needs.
Our first order of business here is collecting zero/first party data. This allows us to sit in a precious real estate – their inbox, and remind them on why it’s absolutely imperative that they make the purchase.
This is done through a variety of ways, with the most common being a welcome pop-up, where we trade them their email (and sometimes their numbers) for a discount. Another two ways we do this is through the browse/cart abandon, where prospects showcase a certain level of intent by taking a look at a product, or adding a product to cart.
These three flows are typically regarded as ‘core flows’, and carry a significant chunk of revenue when traffic is driven to the site.
Conversion
Now that they’ve taken a leap of faith, what do we do?
Sounds counterintuitive, but from the 500+ brands we’ve worked with for the past 6 years, we’ve seen one common trend.
And that trend is that almost all brands have the highest likelihood of customer repurchase in month 0.
This means that past your standard shipping notifications, if you offer an opportunity for an upsell or cross-sell, some of them are going to take it. Now there’s a caveat here – lifetime value is still a function of your product. A customer is unlikely to make another purchase for a bed when they’ve just made one, no matter how good your emails are.
But it also doesn’t mean that you shouldn’t try (unless you like leaving money on the table).
This is where our New Customer Nurture flows come into play, where we blend a variety of angles after thanking them for the purchase, like other products they might enjoy, what other customers are looking at, as well as unique discounts that are time sensitive.
If they’re a repeat customer on the other hand, it’s crucial that messaging is different here. Making customers feel valued is your fastest way of supercharging lifetime value (LTV) and turning them into superfans, bringing you even more profits in the process.
There’s also the innocent looking review request. These are not only helpful in generating social proof to convert first time prospects, but also helping the customer justify their purchase (& thus purchase again), or even giving the brand points of improvement to make their products better.
Retention
And now onto where a good chunk of the magic happens.
If your product involves replenishment (F&B, beauty, fashion.etc), you’ll know that it’s harder and harder to achieve first order profitability.
Instead of competing on that, if you’re able to secure larger margins than your competitors, you’ve already won. This is because META operates on an auction based system, which also means that with larger margins (because of higher LTV), you’re essentially able to outbid your competitors, show up more, and take their lunch money.
This is where our replenishment flows come in. We typically send them a week before the product runs out, securing that next purchase, and keeping them on the never ending treadmill.
When a customer purchases over 3 – 5 times the typical LTV is when they tick into ‘VIP status’. You want to treat this group incredibly differently than how you would your normal customers. Whether this is through giving them first dibs on your product launches, deeper discounts, or even an insider look into things – having a solid group of VIP customers can be lifechanging for any brand.
And finally, the win-back flow.
There’s this misconception that removing people off your email list is a loss. But is it really the case if they’ve proven they have no interest in what you have to say?
Our win-back flow goes out to profiles who have not engaged for a certain period of time, offering them a bigger discount to come back. If they do, we win. If they don’t, we also win, through reducing the size of our list & thus our bill, which results in improvement of deliverability metrics.
And that about wraps it up about how we at Chronos view lifecycle marketing.
It’s an increasingly difficult market out there, and increasingly we’re seeing that the difference between brands that are struggling to get by and brands that are really thriving is in their LTV.
So, if this has been a part of your business that you’ve neglected, now’s the time to take a real hard look, and start figuring out how to do it.
