Business is about customers, revenues, profits and growth. In recent times, as investors splurge money on B2C and D2C companies, it is easy to forget about the “profits” bit! But eventually, every enduring business grows on the back of profits, not an infinite supply of investor capital. Given that one of the largest costs for most businesses after staff salaries is cost of new customer acquisition, it becomes imperative to start thinking about customer retention, growth, cross-sell and referrals if a path to profitability has to be found.
This is where the ideas of Martech come into play. Martech is about existing customers and building deep relationships with them. In the pre-digital world, this was much harder. It was difficult to identify individual customers (that’s how loyalty programs got started), it was expensive to reach them individually (only option was physical mailers), and it was impossible to do any real-time offers or adjustments. The digital world has changed all this. Data at an individual level is plentiful, storage and computing are not constraints any longer, and the brand’s digital storefronts in the form of websites and apps offer real-time engagement and nudge platforms. Martech software is helping drive the shift from optimising acquisition to maximising customer lifetime value.
Martech 2.0 is upon us and with it comes a view beyond the immediacy of the transaction. Starting with the upstream elements of attention, engagement and habits, Martech 2.0 focuses on creating “hooked customers.” A multitude of innovations are driving Martech 2.0 and solving the ABCDE (attention, branding, churn, data and engagement) problems that plague the customer relationship: Messaging+, Ems, Velvet Rope Marketing, Full-stack and Atomic Rewards. Complemented by the progency and rebudgeting, Martech 2.0 lays the foundation for exponential forever profitable growth and the making of a “profipoly.” It is a strategic inflection point in marketing.
The basis for competition is changing. Marketplaces will create private labels out of categories that are successful. Brands will realise that they will need to create a bypass to marketplaces and build their own websites and apps to own the customer relationship. In a world devoid of third party cookies, first-party (and zero-party) data is the gold that brands must strive for. Sooner or later, every growing business will need its own direct relationship with customers. What marketers need to do is to focus on jobs customers want done and craft defining moments because many of the other levers of competition are going to be less effective in a world where every brand can sell anything to everyone via a ubiquitous and efficient logistics network.
In this world, the three metrics of hooked score, reacquisition ratio, and earned growth rate can be the guiding lights for marketers. Leading the way into this brave new world of Martech 2.0 will be the three magicians: microns, micronbox and muniverse.