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Documente Profesional
Documente Cultură
Retention Marketing
For Online Consumer
Businesses
Why You Need An Awesome
Retention Marketing Machine
Who should read this?
Marketing Agency
Growth Hacker Product Marketer Employee
If you are or aim to be one of these, it becomes your ultimate goal to generate more
revenue for your company. This e-book will help you with just that.
Have just started with your role in a fast paced growth company
Are not sure of what marketing campaigns will work for you and why
Are unsure of how to align your campaigns and processes to achieve
higher revenue and faster growth for your company
Acquiring more users and maximizing the footfall/downloads will help you alone to
grow the revenue of your company?
Sending blast emails about offers to all your users gives a boost to your revenue and
you should send them on a daily basis?
To carry out any marketing activity, do you devote 50% of your time planning it and
50% of the time executing it?
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What will you learn?
Loads. Everything you need to bolster your confidence in user retention. Here is the
table of contents:
Retention Marketing
Roadblocks
Next steps
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Consumer Marketing
First, what is a Consumer Business?
By promoting their product to as many users as possible. We call this general product-
based marketing, which has, to date, been the most common form of marketing among
businesses.
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Differentiate your Product while
Marketing at High Scale
Comapnies relied on the strength of their product - its features, price point or other
standout factor (aka the unique selling point - USP) that separated it from the rest of
the competition.
For example, company A produced packaged water that were available in sleek bottles.
These were easy to carry and store. All other companies at the same price point made
only standard sized bottles. To influence user’s buying preference, marketing for
company A pivotted on their variety and utility.
Poland Aquafina Deja Blue Dasani Fiji Smartwater Perrier San Voss Bling
Spring Pelligrino H2O
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Major Focus on Acquiring more Users
To market their product, the major focus was on creating awareness among people.
This gave the product more visibility. People who were not interested, automatically
dropped off leaving businesses with users who purchased from them. The old
marketing funnel looked like this.
This used to work for companies that targetted mass users. Eg: A company that
manufactured salt. Everyone needs salt. But will this work for an app that sells
women’s shoes? Sure, every woman needs shoes, but remember:
When small or mid-sized online companies today adopted the current ‘acquisition
heavy’ approach, they ended up getting plenty of downloads, but the long-term
numbers, unfortunately, told another story.
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Product Based Marketing will help
you get 60% of your Sales. But is that
enough?
According to a report, only 2 out of 10 users who downloaded Android apps, continued
to use it after 3 days (see graph below).
What does this say? Sure, your website or app got the expected traffic but not every
user was convinced to click “buy-now”, “subscribe”, or “sign up”. Would you say that the
users found utility in your product? Will this help you get more revenue?
Moreover, the report says that users who passed this ‘3 day phase’, at the end of 30
days, only 5% of them remained after completing their desired goal (this could be a
purchase, a subscriptiopn or a sign-up).
This was because in the old marketing funnel, companies were not paying attention to
bringing customers back. Users would find the product attractive, use it once to avail
some introductory offer, and leave within a week or month to move to a competitor or
would abandon the product itself. Users had no incentive to stay back.
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Just Acquiring Users is not good
enough.
Users abandoning your product so soon is a bigger loss than you think:
It’s an immediate loss of revenue and hard work that was put into acquiring the
user. As a result your Customer Acquisition Costs (CAC) go up.
A lost opportunity to grow that user over time. One user gone is one user less to
contribute to your revenue, i.e. lower Customer Life Time Value (CLTV).
Companies are now reluctant to continue with this approach. They’ve realised that
keeping a user for a longer period of time will ensure he spends more over their lifetime
is the key to success.
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How do you solve for Users not coming
back?
It’s simple. Start focussing on bringing them back to your business - instead of
concentrating on acquiring countless new customers, increase the profitability from
those you already have.
USABILITY AND
USER PREFERENCE
COMMUNICATION
CHANNELS
A/B TESTING
ANALYTICS
IDENTIFYING USERS
MORE VISITS
SOCIAL MEDIA
MARKETING CUSTOMER
& ADVERTISING SATISFACTION
EMAIL
MARKETING Increase in purchase frequency (how often a
typical customer buys) and conversion rate
(ratio of number of purchase to users).
MOBILE
MARKETING
SEARCH
MARKETING
USER ONBOARDING
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Retaining an Existing Customer is
better than Acquiring a New one
The bottom line: increasing customer retention rates by 5% increases profits by
25% to 95%.
— Harvard Business Review
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The New Marketing Funnel
The shift has led marketers to adopt a customer first approach that has made way for a
new marketing funnel.
This funnel merges pre-purchase and post-purchase stages to present a complete view
of the entire customer lifecycle. Marketers should now own the complete customer
lifecycle journey to maximize CLTV.
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A ‘Customer First’ Approach to
Retention
For a Customer First approach, you
First identify the kind of customers that will be interested in your product/service
(Awareness)
Reach out to them and get them onboard (Engagement and Product Discovery)
Guide and lead them to a purchase (Purchase & Adoption)
Pre-empt their needs constantly
Give them reasons to come back (Retention)
Build the brand (Expansion & Advocacy)
Retention Marketing is all about creating engaged customers that return to your
business to shop again.
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If Retention Leads to Growth, are all
Companies using the same Strategy?
Not quite. That is because strategies and approach vary with the person you are selling
to, what you are selling, and so on.
The two kind of companies that are out there: one that sells to a business - Business
to Business (B2B) and one that sells directly to a consumer - Business to Consumer
(B2C), use different tactics to market their products/service.
The term ‘Retention Marketing’ had come into play in early 2015, when B2B companies
were using strategies to reduce their customer churn (or user abandonment). Hence, a
lot of online content majorly focusses on B2B retention.
Avoid confusion. Make sure the right practices are implemented in your consumer
business. Acknowledge the difference between marketing to a business and marketing
to a consumer. Let me explain this with an example.
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B2C Retention: An Example
Here is an example to give you some perspective.
Perhaps you want to head out for a beach holiday this summer. What would you do?
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The final purchase took
2 weeks
Hence, while marketing to a B2B, one works hard interacting one on one, to streamline
the buying process in order to save time and money. This explains why a B2B purchase
is based more on logic and why a consumer’s purchase is typically emotionally
triggered (whether by hunger, desire, status or cost).
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B2B vs B2C Retention
Different nuances of B2B and B2C Retention Marketing
Due to this, you need to employ different strategies and metrics to retain customers for
your company.
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Only 21% B2C companies claim to
have a Retention Team. Why are these
numbers so low?
Consumer businesses find it difficult to implement retention. Here are few reasons
why:
To make retention marketing work for you, it’s vital to answer all these questions.
You need a way to communicate, engage, retain, and monetize your users more
successfully and with less effort.
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Marketing Automation helps you
overcome these Roadblocks
Today, Marketing Automation, as a software aids all of this. It is a platform specifically
designed to drive engagement via many channels. A platform that lets you understand
your users, their usage patterns on a daily basis, and helps you to communicate with
them at their best moments. It helps you:
Identify users (both anonymous and known) and understand user behavior
Create a coherent marketing communication plan across multiple channels
Prevent over-communication across all channels of engagement
Automate these complex engagement workflows via a single platform
Experiment, analyze your campaigns
Scale-up successful experiments
Dedicate more time in designing and optimising campaigns than just executing
them
There’s never been a more promising time to be a marketer. In our next e-book, we will
explain how you MA can help you implement and scale your retention efforts. You can
pre-book your copy here.
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Key Takeaways
Let’s summarise the e-book for you:
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Next Steps
To achieve retention like industry leaders Netflix, Spotify etc., you first need to identify
your users and channels of communication. We call this finding the right marketing
mix. Start by observing what the giants are doing.
Have a look at some great examples from Netflix. For each one of them below, identify
the following (we have filled the first one for you):
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Want to start working on your own retention strategy?
Or learn from Journey Gallery - pre-made retention workflows for problems that are
most frequently encountered by online consumer businesses.
+1 (408) 890-2392