The right marketing mix can open up doors for an enterprise brand, as successful acquisition campaigns naturally funnel new customers into loyalty and retention strategies. But the rising cost of attracting new customers, coupled with fixed marketing budgets, leaves little room for error as marketers look for the perfect balance between customer acquisition and loyalty.
Although brands have historically placed more emphasis on acquisition than retention — 40% of companies say they have a “greater focus” on acquisition vs. the 15% focusing more heavily retention, according to research by Econsultancy and Oracle Marketing Cloud — the ideal marketing mix is in flux as costs shift and new hyperlocal strategies are introduced on a larger scale.
“A sophisticated marketing blend is one of the real advantages that multi-location local brands have over their truly ‘local’ competition,” says Ted Paff, CEO of CustomerLobby, a retention platform for businesses. “Not only can they maintain a broad marketing mix, but they have the sophistication to track it and migrate their spend over time to better performing assets.”
With that insight in mind, we asked hyperlocal executives for their perspective on how brands can tweak the marketing mix to maximize high-yield results. Here’s what they said.
1. Maximize the highest yielding marketing. “The ROI for marketing to past customers to generate additional revenue is much higher than new customer marketing. For example, we recently ran a nine-month split-test of repeat customer marketing that generated a 28x ROI. We have repeated this test with others and generated similar results. However, there are limits as to how much marketing you can do to past customers before you hit diminishing returns. To get the best results, max out the highest yielding marketing—repeat customers—and add in the new customer marketing—lower yield but more availability—necessary to generate the total results you are looking to achieve.” (Ted Paff, CustomerLobby)
2. Clear ROI drives better yield. “Finding and keeping new customers can be expensive, but it’s the only way to scale. Having the right analytical lens to understand the cost per either acquiring a new customer or activating existing customers for the company can help devise the right budget balance on how and when to invest. Individuals don’t operate in a device or channel silo and don’t have a linear path moving towards acquisition and even post acquisition. Start with clear customer insights and analytics—clear ROI drives better yield.” (Brian Baumgart, Conversion Logic)
3. Taking an omni-channel approach. “An omni-channel approach often works best. We see successful businesses use intelligent direct mail solutions to drive new customer trials. Facebook ads can also be effective on driving new customer acquisition. Social engagement and email communication can be powerful when it comes to staying top-of-mind with the current customer base. When done effectively, this can lead to an increase in frequency of purchase.” (Brian Mattingly, Welcomemat Services)
4. Collect data with the goal of marketing attribution. “Collect the data to determine where they generate high-yield results. As everyone who has ever tried to do knows, it’s a lot harder than it sounds. Once you have the data, buying more of the high-yielding marketing and less of the low-yielding marketing is relatively straightforward. Collecting data with a goal of marketing attribution is hard. There is no perfect solution—only a range of less flawed. For example, our product links actual transaction revenue to ‘last touch’ marketing, but still suffers from lack of insight into the complex multi-touch nature of local commerce.” (Ted Paff, CustomerLobby)
5. Take a holistic view. “There is a baseline of revenue that stems from brand equity, along with the layers of media stimulus. And within the various channels utilized to reach the audience, there is a synergy as individuals don’t operate in a device or channel silo. So a holistic view of what’s working can save time, effort and budget for brands.” (Brian Baumgart, Conversion Logic)
6. Expect changes over time. “Results from marketing channels are never static: what worked last year may or may not work again this year. As a result, having some exposure to a wide range of marketing channels almost always makes sense. Most professional marketers understand this and gradually move their channel mixes over time. That said, sometimes there are temporary channel pricing inefficiencies that warrant a faster ramp up, like the early days of PPC and mobile marketing.” (Ted Paff, CustomerLobby)
Stephanie Miles is a senior editor at Street Fight.