Many moons ago, when I first started in Marketing (at the tender age of about 5, I might add), optimization was all about which Product Silo gets the most high-value customers for their Campaign targets. In those days, Campaign targets were all about the number of people being contacted, rather than responding.
The concept of contact fatigue was unclear and was mainly managed by Campaign prioritization. Let’s say, the mortgages have key sales targets this month, and they get all the best customers. However, Credit Cards are also behind on their sales, so they need them. The arguments about who gets the best customers could go on during the planning phase. But someone had to step in and manage the overall customer to stop them from opting out of Marketing altogether.
As marketing evolved into targeted communications, the optimization issue got more complicated. With a much smaller number of people to contact, how do you choose who should get your offers, where, and when? You still have the key sales targets for each product silo, but now you better understand the customers that are likely to respond. So you start to analyse the results of offers. This gives insights into who is more likely to respond to a particular offer and when. We can then start to choose the best set of customers to receive each offer at the best time.
However, as Marketing teams gained experience and became more savvy, other constraints came into the mix.
- Which channel do the customers want to be contacted on?
- How do I improve my ROI? My team only has a budget of $50,000.
- What email should I send to my customer who has just purchased from the website?
- My customer received 3 emails last week, and they are likely to ask me to stop sending them messages.
This makes the optimization process a whole lot more complex to manage and execute. Potentially millions of different customers, multiple channels, hundreds of offers, and when the customer is likely to respond, or when your channels need the right leads. For a marketer, timing is everything. Arbitrating the right offer at the right time to the right customer helps build relationships and establishes empathy from your side. This is why you need a system to facilitate both contact and offer optimization.
Why do you need a contact strategy?
With a contact strategy in place, the focus remains on the frequency and significance of marketing communication, which is being sent out to the customers from a customer’s perspective in a campaign cycle. A study reveals that 65-70% of the customers opt-out from the subscriber’s list of an organisation if it sends too many emails. It not only helps in combating the contact fatigue but also in enhancing effective targeting for better engagement. The rules and processes need to be in place to identify the relevance of any offer. With Contact Optimization, you can minimize the opt-outs, contact fatigue, increase the customer lifetime value, and avoid losing a customer to a competitor.
The next question that arises in all of our minds is, how do you determine which offer a customer should receive and on what channel? With the help of marketing reports, it gets easier to identify that if a customer is interested in offers A, E, and G, what offer should be sent and when; presenting all three at a single time can result in an opt-out by the customer.
Further, with segmentation, customers are divided into shared characteristic groups, such as the following.
- Customer’s needs and interests
- Gender and age of the customer base
- The geographic location of customers
- Lifecycle spending history of customers
On which channel should an offer be sent is also deeply related to segmentation. By age/group of customers, you can easily identify whether the offer sent via a push notification will have a higher chance of converting or one sent by SMS. It impacts the overall customer experience, which further helps earn customer loyalty, which turns a customer into your brand advocate and motivates them to do more business with you.
To understand how contact optimization works, we can break down the audience into 4 broad categories.
1. Dormant- This category involves the customers who have stopped engaging with your brand. The reason can vary from a decreased interest, or the product can be a one-time-buy kind of product. To awaken the sleepy buyers, marketers need to adopt retargeting strategies like offering a simple 25% off the product or a special gift in the purchase emails. It’s always easier to win back customers who have already engaged with your brand.
2. Selective Subscribers– The category involves customers with low open rates and high click engagement. They do not like to be bothered with too many marketing messages. They are more likely to purchase when a sweet deal strikes them. The offers should be sent considering their socio-demographic profiles and to channels that create less noise. Time optimization is essential to ensure you remain at the top of their inbox, or the notification you have sent is seen.
3. Window Shopper- The subscribers with high open rates and low click engagement; they might open the messages or email regularly, but click sparingly. The offer strategy for window shoppers is all about flash deals. They are more likely to jump on any offers that have discount offers. An offer like Save $5.00 with code EARLYBIRD, *discount limited to the first 50 orders can grab their immediate attention. Considering the socio-demographic profile for window shoppers is essential as baby boomers might like to receive the Birthday promotion on their emails.
4. Loyalist- The customers or subscribers with both high open and click engagement rates. They would like to receive messages which empathize and are not a selling opportunity. A ‘Surprise and Delight’ reward is an example that brands deploy to keep their loyal customers connected and even create new ones. You can further enhance the experience by reaching them via social media or any other channel they prefer.
Customers are never one-size-fits-all. You have to connect and engage with them on different levels, platforms, and channels. Even if it is a dormant customer, do not dismiss them, find the right chance, or formulate a retention strategy to interact with them.
Creating specific rules for each customer helps identify how and when you communicate and the minimum or a maximum number of offers you send in any given time period.
Unica Optimize to optimize your contacts and offers.
Unica Optimize allows you to manage all of these constraints and business rules across your organisation, using the power of Unica Campaign to segment your data and provide seamless results to your channels. The offers you create in Centralized Offer Management feed the Optimize process. Along with the data from Campaign, so any of your data sources can feed the information to build your business rules and constraints. The centralised contact history is then used to find the perfect time to send the offer to your customers without causing contact fatigue.
These are just a few examples of course with millions of contacts you can break down in multiple subgroups and an infinite number of contact optimization rules. This is where Optimize helps you structure those rules (Suppression rules, Contact Frequency preferences & Channel preferences.) It lets you plan how often you send marketing communications to your customers and how you send it. It can help you take control over scenarios like customers in the welcome series should not receive any other email; when a customer has already received a gold offer should not be bombarded with the silver one.
If you are really looking to increase your ROI, optimization should be a part of your routine job, and Unica Optimize can help you with it. Imagine all that, and now with the release of version 12.1, you can get access to Optimize as part of your new Unica renewal.
Get in touch and see how we can make Optimize work for you.