Over the last several years, much has been written about the benefits of measuring lifetime customer value (LCV). The theory is that if you can determine the revenue potential of all of your customers, you can direct your marketing resources to the accounts that have the highest potential yield and thereby maximize the ROI of your marketing dollars.
Understanding LCV can yield some great benefits. However, there are limitations to this practice that, if not avoided, can produce negative results.
Perhaps the biggest danger is over-investing in programs and initiatives that seek to capture profits only or primarily from the most active, highest spending customers. This ignores opportunities from customers with growth potential and from prospects and former customers who represent attractive profits if they can be cultivated into active customers.
It is said that companies will lose 50% of their customers in any given five-year span. Consequently, the need to focus your marketing efforts on new customer acquisition cannot be ignored. While using an LCV model will lead to an increase in profits from high-value customers, over-reliance on LCV can lead to a steady decrease in your pool of customers and overall profit if not balanced with customer acquisition.
It’s important to communicate with a wide variety of customers through all the various stages of the prospect/customer lifecycle. Having a range of marketing materials targeting different segments can significantly increase the ROI of your marketing efforts. With today’s database and print technologies, it’s never been easier.
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The sales letter, lift letter, and brochure tucked inside your direct mail package all share one purpose – to compel the reader to complete and return the reply card. While most cards may never be returned, every card that is returned represents an interested prospect. The value far outweighs the cost of printing and insertion. When you look at it this way, you begin to view this thin, rectangular piece not as an afterthought, but as an integral component of your direct mail strategy.
Creating an effective reply card is an art. Within the defined space of a few inches, you must capture interest and summarize your selling proposition while leaving room for the respondent’s contact information, your return address, and postage. Graphics should be subtle to avoid confusing or distracting the reader. Coated cardstock won’t work because the respondent needs to write on the piece.
Well-conceived reply cards have several things in common:
- They get straight to the point about what is being offered and what the reader needs to do.
- Checkboxes are included with a positive call to action and often an incentive as well: “YES! I accept your free trial offer!”
- Additional avenues for responding are featured prominently, such as a toll-free telephone number, QR Code, and links to social media.
- An expiration date is included to create a sense of urgency.
Studies have shown that response rates can be greatly increased when response devices are personalized. In this age of identity theft, however, you must be sensitive to the amount of information that is traveling through the mail on a postcard. If your business requires personal data like date of birth or a credit card number, be sure to include a reply envelope. Whatever approach you take, make sure your piece meets U.S. Postal Service standards for cost-effective processing.
A reply card is arguably the most important piece inside your direct mail package. Rethink the role this seemingly simple piece plays in your overall direct mail plan.
When it comes to developing marketing content for the B2B market, targeting by experience level matters.
This is the conclusion of a survey of 700 global business executives by The Economist Group, which found that B2B prospects from Generation Next (up to 10 years business experience) have very different preferences and motivators than Business Veterans (more than 10 years business experience). In fact, when it comes to marketing content and channel preferences, there can be up to 35 percentage points difference.
Among the differences between the two?
|Generation Next||Business Veterans|
|Are turned off by content with feels like a sales pitch||46%||69%|
|Prefer content in the form of articles||69%||91%|
|Find research reports helpful||30%||65%|
|Find white papers helpful||12%||37%|
|Favor video content||21%||12%|
|Prefer other multimedia such as infographics||12%||24%|
|Spend at least four hours per week perusing business content||31%||57%|
Source: The Economist Group
In other differences, 41% of business veterans think company reputation holds more weight than colleague recommendations (10%). Meanwhile, only 28% of Generation Nexters think company reputation holds more weight than colleague recommendations (27%).
People are people, whether they are in a business context or a home and family context. When crafting your next B2B campaign, remember that targeting your content by experience demographic matters as much as market vertical, job position, or other traditional demographics.
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