Profit Generation Through Dialogue Marketing

I know, my articles don't seem to follow a particular order. These are largely determined by events at work and/or reflect the workings of a disorganised mind. This article dovetails with a more detailed piece I wrote, which is available for download here.

Using the power of new technology isn't just about mass email, which is essentially an unsophisticated acquisition tactic. It is far more involved, personalised and interactive; and can greatly improve your ability to develop strategies for both customer acquisition and retention; not to mention enhance your profitability prospects. This is a brief discussion to put retention and acquisition into perspective.

Marketing continues to be the sum of all business activities involved in the transfer of goods and/or services, from the producer to the consumer.

Traditionally, marketing has been primarily outwardly focussed, namely on the acquisition of new consumers. So if you look at the diagram, that would mean that the efforts were mainly expended on acquiring grey dots.

More recently marketing has evolved to emphasise an inward focus too, namely the retention of existing consumers; or to put it simply, expending an effort to keep your coloured dots.

This has come about as a result of the cost advantages of retention versus acquisition. Moreover, in a fiercely competitive and increasingly fragmented market place, new "virgin" customers are not in abundance, with consumers becoming increasingly savvy.

Fortunately with the advent of new technologies both the tasks of acquisition and
retention can be easily and affordably facilitated. In fact, the new technologies allow your marketing strategies to become an omnipresent, personalised, 24/7 tool to keep your brand “top of the mind”, instead of the mass marketing, traditional mediums of yesteryear.

Marketing Acquisition

Marketing continues to perform the function of acquiring new consumers. Aside from the usual mass marketing approaches, this usually involves progressing a lead from suspect, through prospect, to first time consumer. This “lead nurturing” is easily enhanced through the use of new technology.

For a more detailed discussion of how technology can assist your acquisition efforts, click here.

Marketing Retention

Without proper care, any first-time customer, repeat customer, client, or advocate can become inactive or lost, causing the company substantial losses in sales and profit. In fact, your customers are constantly in a state of flux. It is up to you to determine what your loss rate will be. Of course you could take the "who cares" attitude, and continue to concentrate on acquisition; but at what cost?

Summary

There is no doubt that traditional marketing remains vital; what has happened is that the emphasis has shifted from the transaction to the relationship. In this context relationship does not refer to a deep, meaningful, interpersonal connection; rather it refers to a customer’s purchase history.

Of course during the acquisition stage there is no history. Here the objective is to get a prospect to make the transition to customer, in other words you coax the grey dots towards the funnel. Even those dots that do not become customers, should be nurtured until they become ready, given that it usually takes multiple contacts before a prospect is ready to transact.

During the retention stage you, and your customer, have a history. Hopefully it is a good one, and you can leverage off of it. Too few people do, and this is why so many customers defect to your competitors. You can implement some amazingly simple strategies that are effective at acknowledging the customer, creating a positive brand experience and reducing and post purchase cognitive dissonance. It is all about retaining your coloured dots; or at least slowing down the rate of attrition.

For a more detailed discussion, specifically how technology can help you (with examples), please click here.