The term “customer marketing” seems something of a misnomer. After all, isn’t marketing always about the customer? The answer is “yes,” but at the end of the day, there are actually two types of customers: the ones you want to acquire, and the ones you already have.
Customer marketing focuses on the customers you already have. Many business owners and marketers make the mistake of devoting all their attention and resources to the acquisition of new customers. This seems logical — the more customers you acquire, the more you’ll earn, right? Not necessarily. Remember the 80/20 rule, which states that 80% of revenue comes from 20% of customers. In effect, this means the majority of your sales will come from a small core of customers. Those people who already love your product or service, who buy from you again and again, and who recommend to their family and friends to buy from you too.
Your existing customers offer huge potential to increase your income and grow your business. Customer marketing is about maximizing your relationship with and revenue from that core customer base. How? Via a range of strategies, such as retention, loyalty-building, advocacy, and community.
Why Is Customer Marketing Important?
Make no mistake, acquiring new customers is a crucial marketing goal. However, when you shift some of your focus and budget toward customer marketing, you can reap the rewards that come with building on your existing customer relationships. Here’s why customer marketing is too important to ignore:
- The acquisition of new customers is very expensive. Acquiring a new customer costs up to 5x more than retaining existing ones. And the success rate of selling to existing customers is 60-70% compared to just 5-20% for new customers. To stay competitive, companies must work to maximize existing revenue sources — and your current customers are a ripe opportunity to do just that.
- The hard part — getting a customer on board — is already done! Once you’ve done the hard work of gaining a customer, it’s time to focus on retaining them. Active customers generate revenue by coming back for repeat purchases, recommending your brand to friends, and spreading the word by participating in your social media and digital marketing efforts. Now is the time to deepen the relationship and encourage customers to become active customers.
- It’s an opportunity to get to know customers better. A huge advantage of your existing customer base is that you already have information about them. During their customer journey, you have collected their contact details, purchase habits, browsing preferences, and more. With the right analytics software, this data can help you understand what your customers are looking for and keep you on-trend about what’s happening in your niche market.
- Customer marketing is exponential. Customer marketing is an entire world of opportunity beyond the moment of conversion. It transforms customers into advocates who will spread the good word at their own volition and at little cost to you. Your brand advocates are the key to more customers and more sales.
Who Is Responsible for Customer Marketing?
According to an Adobe study, 81% of business owners said building customer loyalty is a top priority. Clearly, customer marketing is gaining traction as more companies internalize the potential of their existing customer relationships. Even so, creating a customer marketing strategy can be challenging. It typically involves a cross-departmental effort, coordinating staff from disparate teams who have the knowledge and skills to appeal to the people who already know your product and have experienced your brand journey.
Customer marketers collaborate closely with product marketing teams. Product marketers work daily to understand the needs of current customers and share updates about new products, features, benefits, or industry trends with them.
Customer success managers and account managers also have an important role in customer marketing. They spend their days at the ‘coalface’ dealing directly with customers — building trust, solving any issues, and providing any additional value. Customer marketing is a hugely cross-functional practice that usually involves the input and partnership of the broader marketing team, in the areas of conversion optimization, email marketing, content marketing, social media, and events.
How to Do Customer Marketing: 4 Best Practices
Customer marketing is about identifying opportunities to engage and convert existing customers again and again. To really read your customers’ minds and create an effective customer marketing strategy, here are four best practices to follow:
- Want good customers? Be a good seller! Consider the impression you make at every touchpoint with your customers. Each contact with a customer is an opportunity to satisfy them and to validate their choice to buy from you. It's important to be honest, transparent, and reliable in your communications, whether by email, chat, social media, or phone. Keep your customer support team well-trained and motivated to please customers. Make sure to stay on top of problems, returns, or special requests. Good interactions will keep your customers coming back for more.
- Keep your brand top of mind. Consumers are bombarded with marketing messages and ads. Brands must make an extra effort to keep their customers' attention, before and after the sale. Stay in touch regularly with existing customers via emails, newsletters, chat messages, retargeting campaigns, special offers and discounts, and more. To make your brand stand out, it's vital to provide added value. Make every interaction count. Only share relevant content, compelling offers, and tempting product recommendations.
- Make customers feel part of something meaningful. Today, a brand has to be much more than just a collection of sales messages. Consumers want deeper connections; they want brands that speak to their values and emotions. The best way to connect to customers is good, old-fashioned relationship building. Even in a digital age, customers connect more deeply to authentic interactions. Create community forums, online and offline events, provide space for customers to give reviews, ask them for specific feedback via surveys and questionnaires, involve them in your vision and values. Make them feel that by connecting with your brand, they are connecting with something bigger and greater.
- Get personal. Personalization is critical to marketing success — 79% of consumers say they are more likely to engage with an offer if it has been personalized based on past purchasing behavior. Brands can't afford to ignore personalization when developing and executing their customer marketing strategy. Use personal information and behavioral data to be more effective in your offerings to existing customers, such as customization of email, recommendations for products they might like, greetings and offers on special occasions, such as birthdays and anniversaries.
7 Common Customer Marketing Tactics
Customer marketing includes a range of retention, brand loyalty, community building, and brand advocacy activities. Here are seven popular tactics that can be used to create a powerful customer marketing strategy:
Consumers today place far less trust in advertising than previous generations. Online reviews are the way to build trust and credibility among your target market. In fact, 91% of millennials trust online reviews as much as their friends or families. It is vital to provide platforms for customers to rate and review your business, whether on Google, Facebook, or sites like Yelp. Reviews must be genuine and truly reflect your business and service.
Don’t worry about the odd negative review — make sure to follow up with an honest reply that shows a willingness to solve the issue in a fair and customer-focused way. Satisfied customers are an excellent resource for positive reviews, and can even be an opportunity to generate more sales. For example, send an email a few days after the purchase asking the customer to submit a review in exchange for 10% off their next purchase. Not only do you benefit from another review, but you may also encourage the customer to buy again.
Customers who have had an exceptional experience with your brand are the perfect candidates to provide testimonials. Not every customer, even if they are satisfied, is the right fit to advocate for your business. But those who adore your product and love your brand? These are the ones you should focus on to provide testimonials. Their enthusiasm will shine through, and will naturally drive interest and curiosity among other customers.
Build relationships with your most passionate customers and give them platforms to sing your praises. Whether it be a video testimonial promoted on social media, or a case study about their experience or even a quote and image on your homepage — don’t be shy about letting them have the spotlight. It will pay back many times over in your customer marketing success.
3. Cross-selling and Upselling
Remember the 80/20 rule? Customers who have already purchased from you at least once are ripe targets for cross-selling or upselling. After all, they have already proven their interest, and you already have data about their previous purchases and online activity. Why not leverage that data to tempt them with further sales? For instance, you could send them an email with recommendations for products they may like based on their previous purchases. Or you could offer an upgrade on their last purchase at a discounted rate. If you are selling a subscription, offer an extra month free with their next renewal. The possibilities are endless.
4. Referral Programs
Did you know people are four times more likely to buy if a friend referred them? Referral programs are a popular tactic in customer marketing, as they plug into the powerful phenomenon of word-of-mouth recommendations. Word-of-mouth marketing is nothing new — people have been recommending products to their friends forever.
The internet opens up a whole lot of possibilities about how to leverage this age-old tradition. Create a referral program that incentivizes existing customers to refer their friends to your business. For example, offer a coupon for every referral, or provide a referral link that customers can send to friends. If a friend signs up via the link, the referring customer automatically receives notification of a benefit, such as a free gift or a discount.
5. Loyalty Programs
With brand loyalty hard to come by, a key customer marketing tactic is to encourage loyalty by rewarding customers for their ongoing patronage. Loyalty programs are beneficial in two ways: firstly, they create feel-good moments that reinforce positive experiences with a brand, and secondly, they provide a framework to collect more data about the customer, which can help personalize future marketing efforts.
Create a reward points system, in which the customer accrues points for every purchase that can be traded later for cash value or product upgrades. Or send email newsletters to club members notifying them about members-only sales and offers. Give customers worthwhile reasons to check in and convert on a regular basis.
6. Community Building
In the internet age, when purchases often happen online and human contact is minimal, building communities is vital to a customer marketing strategy. People like to feel that they are part of a group or a community, and businesses that work to create communities around their brand or products can boost customer loyalty, satisfaction, and sales. There are many ways to build customer communities, both online and offline.
Online, you can create social media groups or business pages where customers have a direct line of communication with you and each other. Sponsor a discussion forum about topics relevant to your industry or niche and get the conversation flowing. Invite customers to share their ideas and opinions. Offline, organize local networking events, attend trade shows, and initiate panel discussions. If possible, maximize your opportunities to meet customers face to face. Even in our online-obsessed world, nothing can replace the intimacy of real-life interaction.
7. Educational Programs
65% of B2C marketers create content to educate the audience about their brand. Yet in customer marketing, you are already beyond the stage of brand education. Existing customers already know who you are and what you do. So, you can take customer education to much higher levels. For example, create educational programs about advanced ways to use your product, new features, or even training in areas related to your niche.
Promoting educational videos and content targeted primarily to existing customers will keep them interested and excited, and will solidify your reputation as a brand authority and leader. This is a fantastic way to inspire trust among your existing customer base while building an exclusive and engaged community at the same time.
A big advantage of customer marketing is that you start ahead of the game. It’s the difference between marketing to strangers and marketing to people with whom you already have a relationship. Trust and familiarity are already there. A strong customer marketing strategy will work to deepen your existing customer relationships over the long term, and this is the key to fast exponential business growth.