Most organizations today have some sort of CRM system. While some are more robust than others, it’s a way to capture and track information about your customer base. The big question is, does your customer database marketing help you grow your business?
Keep reading to uncover:
- Why you need to implement customer database marketing
- How to use customer data for marketing
- Ideas to promote repeat business
What is customer database marketing and why do you need it?
Let’s slow this down for a moment and make sure we’re all on the same page. Customer database marketing is using data you have captured about your existing customers to inform and guide ongoing marketing strategies and tactics. It’s using your customers’ past behaviors and interactions with your company to guide your future actions.
Makes sense and it’s likely nice information to know, but why should you really care about all that available customer data? Three reasons:
- It helps your sales team work smarter instead of harder.
- It’s the fastest way to boost your company’s bottom line.
- It allows your organization to develop intelligent business strategies.
HubSpot’s 2018 State of Inbound report revealed that salespeople identified prospecting as the most difficult part of the sales process. Digging deeper in the report, 30% of salespeople said that closing a deal was growing more challenging. And 40% admitted that just getting a response from prospects was getting more difficult.
Progressing a cold call to a warm opportunity to a customer has become a long, arduous process. So what’s the alternative?
Growing and driving repeat business!
Here’s more interesting facts:
- 90% of customers are likely to purchase more than once. (HubSpot Research)
- A 5% increase in customer retention correlates with at least a 25% increase in profit. (Bain & Company)
- 50% of loyal customers will make more purchases and 60% will purchase more frequently with their preferred companies. (InMoment)
Existing customers are much more likely to purchase from you again than new prospects are to make a purchase. So when you focus on repeat business, it takes less work, less time, and less money to close a sale. As a bonus, repeat customers are also more likely to make a larger purchase than a new customer.
Customer database marketing is the key to helping sales overcome their hurdles, growing your bottom line with repeat purchases, and providing insight into your customers to help you make more informed strategy decisions.
Using customer data for marketing
Okay, so you know why customer database marketing is a smart business strategy. Let’s look at what information you have about your customers that can help you drive repeat transactions.
What did they purchase?
Let’s start with the easiest way to drive repeat business — the add-on sale. Are there natural add-on or related products that existing customers may need? Review your customer database based on products purchased and then create lists of target accounts for your natural extensions.
If you’re an HVAC company, customers who purchased a new heating and cooling system will need a maintenance contract. If you are a copier and print management company, customers will need supplies, servicing, and software options to manage their documents and mailing systems. Even as a marketing agency, a client who initially started with a branding consultation may need ongoing marketing and content strategies now that they have established who they are.
Look at what products and services your customers purchased and offer the next logical addition once you know they are comfortable and satisfied with their initial transaction.
What do they need or want next?
Your customer may have made their initial purchase from you to solve a specific problem they had, but that doesn’t necessarily mean all their challenges have been resolved. Take a look at how and when your customers have engaged most with you. They may not always be direct with what they want from you, but if you look, the information is likely there.
- What content are they engaging with?
- What social posts are they responding to?
- What questions are they asking when they message you?
- What concerns are they sharing in surveys?
Pay attention to how your customers are behaving and what they are saying for clues that they may have a new challenge you can help them solve. Then develop appropriate customer database marketing strategies from what you have uncovered.
What has changed?
If there is one constant in life it is change. How are things changing for your customers?
- Have there been new additions to their staff?
- Did they change locations?
- Has there been a recent merger or acquisition?
How have your customers’ businesses grown or changed that has opened up new opportunities for you to help them? Pay attention to changes in contact information and social media posts for signs they may need more of your products and services.
How else can you use customer database marketing?
Hopefully by now your creative ideas are starting to flow based on the data you have collected from customers. (Tip: a lot of this data will even be helpful with prospects.) Beyond using your data to directly influence repeat sales, you also have information that can support your sales and marketing efforts indirectly.
Keep your marketing personal.
Use your customer database to help with personalized, targeted email marketing. Customers with an emotional relationship with a brand have a 306% higher lifetime value and will recommend the company at a rate of 71%, rather than the average rate of 45%. (Motista)
This goes beyond using someone’s name in your greeting. Use data to segment your customers so you can offer them solutions and additional products based on their needs, wants, and behaviors.
Your data will also reveal your customers’ motivations to purchase. Are they more motivated by exclusive offers or specialized attention? Do they engage with you more when you reward them after multiple purchases or publicly acknowledge them on social media for referring new customers? Personalize your customer database marketing and sales approach by using more of what excites and incentivizes them.
Reduce customer churn.
It may surprise you, but your database can reveal very clear signs that a customer may be looking to leave you.
If your customers typically purchase from you on a monthly basis, take a look at who has not made a purchase in the past 3 months. Now compare that to customers are no longer engaging with your email marketing. Any similarities?
Those are customers your sales team should be connecting with soon.
Enhance customer service.
The information you have been naturally gathering over time is not only a key component for customer database marketing, it’s also extremely helpful for achieving customer delight.
Good customer service is key to customer satisfaction. Over $62 billion is lost annually by American companies due to poor customer service. (NewVoiceMedia)
It should catch your attention that 33% of U.S. customers will consider switching companies immediately following a single instance of poor service, and 60% will consider switching after two or three poor experiences. (American Express)
Respond to inquiries quickly. React to suggestions and feedback appropriately. Request regular feedback and make changes to enhance your customer experiences where needed.
Customer database marketing is strategic and intentional. If you want to increase repeat business, stop the random acts of marketing by looking and listening to what your customer data is telling you.
Want to learn more about developing an effective marketing strategy for your customer base? Download our Buyer Persona guide and learn about one of the best kept marketing secrets.