Making It Happen
The success of the new marketing ideas will be dependent on the budgetary allocations. In most brands today, the Best:Rest:Next budget is 2:8:90. The largest chunk is for new customer acquisition. A small allocation is for existing customers and since there is no differentiation, the spends in the Best and Rest category end up being proportional to the customers in these segments. In fact, most brands do not even have a Best and Rest split – treating them just as a single bucket of “All Customers”.
The right way to allocate budgets is to allocate equally to all the three segments. While this may not happen immediately, a starting point should be to make the allocation 20:20:60 – reduce the acquisition budget from 90% to 60% and then spend the remaining budget equally for Best and Rest customers. Only when brands follow their customers and reallocate their money will this new simplified marketing approach.
Where should marketers spend this new money for Best and Rest customers? The short answer is: the marketing cloud. But how?
First, marketers need to get the ABC right – Analytics, BCG and CLV. CLV is key for customer segmentation and correctly identifying the Best customers. BCG tells marketers more about the attributes and activities of the Best customers – this is what has to be cloned for everyone else. Analytics and AI-ML can help make this process simpler – with continuous learning.
Second, marketers need a customer communications, engagement, and experience (C2E2) stack. This stack forms the core tech for Velvet Rope Marketing and needs to be activated only for the Best customers. While point solutions can be bought and integrated together, a full stack solution is likely to work better because it will eliminate the tech connectivity and data sharing challenges. More importantly, with all the data in a single store (rather than multiple silos), the magic of AI-ML can work much better. What the marketer needs is to know what happened yesterday, what to do today (next best action), and what is likely to happen tomorrow – a good AI-ML engine will help with the analytics and predictions freeing the marketer from the tyranny of the daily routine.
Third, marketers need M3 (Messages-Microns-Mu). Push messages need to be transformed into microns with rewards (Mu). These messages offer incentivises for attention and action for the Rest so they never ignore brand communications. It is better to pay one’s own customers for their attention rather than compete in auctions on Google and Facebook and spend 10 times more money in re-acquiring them via ad platforms.
Finally, marketers need an Adtech-Martech Bridge (AMB). This bridge serves two purposes: prepare the right attributes and profiles for adtech platform for acquiring the Next customers (lookalikes of the Best), and ensuring that the onboarding process is smooth for these first-time customers. So far, adtech and martech have largely operated independently even though they target the same customers at different points in the journey. The AMB is the missing link which can further optimise ad spend budgets.
Much like Luke Skywalker had R2-D2 and C-3PO, the modern marketer needs ABC, C2E2, M3 and AMB. And to all such marketers willing to make the leap, “May the Force be with You.” And as Qui-Gon Jinn says, “Your focus determines your reality.”