Let’s imagine the following situation:
A bus operator, one of many in the country. Financials aren’t bad, despite the growing competition from both other operators and trains, as well as air transport (so called “low cost airlines”). The board got the feeling the company is losing contact with its customers. They have struggles with customer identification: they cannot differentiate between loyal and one-time customers. It’s getting problematic to recognize the customer journey – and as a consequence, to identify crucial touchpoints.
Sounds familiar? It may not be bus operator, it may be any company – B2B, B2C, doesn’t matter; SMB or large one, operating within one country or several. For any company in the world, a defined customer journey path and being able to distinguish between loyal and one-time customers are essential elements. Those are recognized as best ways to create added value and establish (or improve) competitive advantage.
Start gathering information
Information can be transformed into knowledge, which can be translated into solutions to improve the overall performance. Briefly: business intelligence.
But why do we need such a knowledge?
Let’s assume our target is to generate 100.000 new leads. The company’s goal is of course to transform (convert) those leads into customers. By collecting data and using marketing automation we could significantly decrease the costs of one customer by 42,5%.
How is it possible? from where are those numbers coming?
Let’s assume our company, based on experience, plans to generate 100’000 marketing leads. Proper usage of data we gather about the customers can significantly increase the number of leads: up to 20% . This brings us 120’000 marketing leads!
Going further: let’s say our company operates in the UK. Using current models and methods from assumed 100K leads, the conversion rate in the field of transportation e-commerce (equal to 4,59% ) would result in more less 4,6K customers. By proper usage of knowledge about those people, our company could increase the conversion rate by 51,5%  and, as a result, generate nearly 7’000 new leads.
More leads means higher conversion rate, but at what cost? Statistics say that the average cost of generating 1 lead (from those assumed 100K) equals $22  (transportation e-commerce). Proper usage of data about the customers can possibly decrease cost of the lead by 13% , which results in a $19.14 cost per lead (CPL).
Taking the above into consideration, let’s do some math:
In the current model, by spending $2.2K the company would generate 4,590 customers, which ends with $479,3 per customer.
In the model based on knowledge and usage of it, by spending circa $2.3K, the company can generate 8,340 customers (more leads, higher conversion rate), which results in 275,39$ per customer (lower CPL).
Implementation of the solutions based on collection and usage of data about customers can significantly decrease cost of one customer – by 42.54%!
How to achieve it?
The main question of course is: what precisely do we understand by usage of the data about customers, especially in the context of the discussion about personal data security and methods of gathering and processing it by companies around the world?
Our hypothetical company doesn’t operate in vain. There are plenty of areas where the interactions between a company and potential customers take places: website, social media, email, landing pages, SEM, e-commerce platforms – to mention the most recognizable ones. Those identified touch points generate enormous amount of data like personal data required to make a purchase, but it’s not over. The following also generate data:
- what is the source of the traffic on our website?
- what is the time spent on our website?
- which subpages were visited?
- does the visitor read the company’s blog?
- is the customer active on social media?
- what are interesting destinations for particular potential customers?
- does the customer prefer low-budget transportation?
And this is only the tip of the iceberg of information we can gather through the above mentioned touchpoints. Why? To help our customer – even without identifying them – and give them a tailored offer.
See the example below:
1. Our customer, John Doe, receives an initial mailing. For the purpose of this example, it’s enough to say we have his consent to receive information and to process his data – and the company doesn’t violate any legal regulations. If John Doe receives another ordinary mail, but there is a huge chance he won’t even open it, just like 80% of other recipients
2. However, if the mail is personalised, based on gathered data about John (e.g. his searches of hotels in a particular city), and we title the mail suggesting a suitable transport to this place, there are good chances he will not only open the mail, but most likely go further in the customer journey.
3. But, there is no point in redirecting John to our website if we can’t instantly present him the content that meets his needs in the first place! We must know what John is looking for (what concrete mail redirected him to the website) in order to display the proper content.
The company is well known, but obviously not everyone has to recognize the name and scope of services. Definitely not everyone has to know our standards and our pride of them.
4. If John Doe is a person who does not possess that information, in all likelihood he will look for opinions about our company; what better way if not asking friends and peers?
Being conscious of the above, we can redirect him to the right space by predicting the intentions of our potential customer, no matter if he is on our website, on social media or on a search engine page.
Having a certain destination in mind and the offer that meets his expectations AND needs, John Doe has read opinions about our company and has returned to our website. He has no intention to search the details of a particular trip once more, so we need to make sure he will receive his information instantly.
Is this the end?
Obviously not! We can get even more from those interactions. Firstly, if for any reason John resigns at any point of customer journey, we would have this information – and we can try to identify the reason.
Secondly – and this is the path we want to implement as a standard, just like any other transportation company – John Doe might convert into a loyal customer, who will consider our company in his future travel plans.
However, some factors cannot be influenced. For example, as a marketing department, we cannot create his experience from the trip itself. Possibly he won’t like something during the trip – but of course we should do our best to collect additional data that we could utilize. Why? For addressing the issues and working on improving the overall performance of the company.
How to put this all together?
The answer is Marketing automation, a system that enables company to not only aggregate data from various touchpoints, but also use them for actual activities. CRM integration, social media management, mailing system, CMS for websites and landing pages – and limitless areas and dimensions for data analysis.
That’s why, when it comes to strategic decision making, creative ideas are appreciated, but decisions are made (or at least should be) based on actual numbers.
Marketing automation – What are available options?
When we already know the advantages that come with marketing automation tools in general, there is a time for critical decision: which concrete software / which provider should we choose? Most of available solutions are sold as SaaS / PaaS, in a subscription model – and there are literally plenty of them. Some are designed for small and medium companies, some work mostly with biggest and most known world brands.
To make a reasonable and – even more important – profitable decision, we need to prepare answers to few questions. Answering them isn’t easy as it requires some time and effort. However, it should be done with appropriate attention. All of them are equally important.
Who are our customers?
The question which may bring many troubles to answer to. Often we think we know our customers because we have their basic data, but do we know how are they making their purchases decisions? Do we know how they heard about our company and our products?
Answering to these questions is not always possible, because we often did not collect such data before. This might actually also be helpful: we’ll know that we need a marketing automation tool with extended analytical modules!
What do we want to achieve?
This should be the easiest question from this list. Either we’re looking for a savings or we want to increase income. Simple, right? Well, not quite so. Marketing automation tools may be used also for campaigns to increase the brand visibility / recognition; other answer might be improving the overall customer experience that company provides. Of course, somewhere in the end of this path, there is money – but we need to precisely define what are our short- and long term goals
What kind of data do we need to have and use to achieve our goals?
Another tricky question. Some may say: “all available data need to be gathered”, but there is a significant difference between data processing and storing. There is no point in gathering all available data if we are not going to use it because of lack of knowledge, lack of experience, lack of idea. Well, it might be used in the future, that’s truth. However we need to compare potential benefits to costs.
The points above obviously don’t fulfill the list of things to think through.
However, they should help us putting our thoughts in the right direction. All those questions consist in fact of several other and listing all of them is impossible as each company operates with a different model, in different circumstances and economic environments.
What is constant regardless the company’s size, branch or country, is that marketing automation tools can be real game changer and help to gain competitive advantage.
Obviously, above I described only an example. Some constants are assumed, situation is depicted in simplification, and numbers are just carefully chosen averages. But those averages come from official surveys (by Hubspot or PwC).
Text wasn’t to prove particular numbers. The purpose was to show the level of change we can discuss by implementing Marketing Automation solutions.
 DemandGen, Calculating the Real ROI from Lead Nurturing, 2013
 Monatate Ecommerca Quarterly Report [Q4 2015, Q1-Q3 2016]
 Aberdeen Group, Marketing Lead Management Report
 State of Inbound Marketing Report, 2013
 State of Inbound Marketing Report, 2013
 PwC, „They say they want a revolution: Total Retail 2016”
I have 6+ years of experience gathered in various branches, helping organisations on different levels of their Digital Journey. My professional interests cover Marketing Automation (Hubspot Certificates: E-mail marketing, Content Marketing, Inbound Sales) and analytics (Google Analytics Individual Certification). My academic background - Sociology: social communication - helps me to see things from a different angle, better understand customer's journey, define challenges and translate them into recommendations for future activities - and, at the end, execute.
I like to spend my free time with my fiance and our two dogs - silly but adorable english cocker spaniels. And books - I couldn't live without at least one new book per week.
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