This article originally appeared in the March 2013 issue of CUSTOMER Magazine.
In the last couple of years, mapping the customer journey has become a priority for many marketers. With marketing automation technologies, new communication channels and social media, customer interactions have multiplied tenfold. Unfortunately, as many marketers attempt to map the customer's journey from beginning to end, the process has become everything but linear.
Furthermore, the marketer can guess but not truly foresee how a customer’s journey will change along the way. Even in the age of big data, unpredictability is here to stay. For these reasons, I believe that customer state marketing is a viable alternative to current cross-channel marketing practices. This new method allows marketers to build a complete enterprise marketing strategy iteratively rather than working within predefined paths.
Customer state marketing is a customer-centric, cross-channel approach to relationship marketing that directly and succinctly aligns marketing actions with customer behavior. The state is at the core of identifying who a customer is. For example, a state can be used to define the step of a process, but also live segmentation (see examples below).
The idea is that you want to react differently, yet in an automated way, depending on the state of each individual customer. Customer behaviors will be interpreted and answered differently depending on the state of each individual customer. For example, an unknown customer will receive an e-mail after he visits a website. However, a frequent customer will not, as he represents a different state of the customer journey. In other words, customer state marketing takes into account individual attributes and behaviors to tailor timely marketing actions to be more relevant, more valuable, and more credible from the customer’s perspective.
Examples of various states for different programs include the following:
sales funnel states;
suspect, prospect, lead, opportunity, proposal, client, lost, etc.;
enrollment or renewal program states;
new member, active member, solicited member, renewed member, inactive member, loyal member, etc.;
viral contest states;
registered, referred, ambassador, unregistered, winner, participant, etc.;
customer lifecycle states;
lead, new client, loyal client, at risk client, regular client, etc.;
client scoring states; and
high value client, low value client, one time buyer, inactive client, etc.
CSM differs from traditional marketing, which is a complex and overwhelming mapping task. Instead of creating campaigns with predefined paths that a lead can follow as in the lead nurturing process, CSM reflects the registered events that define the customer’s buying path. This has the advantage of treating each customer individually according to his or her behavior and profile. It also takes into account the fact that customers rarely follow a predetermined path from awareness to purchase. CSM is centered on the individual’s buying process, not the merchant’s selling process. The ultimate goal is to identify each individual customer, to engage them in a meaningful way, and to track and monitor their behavior as they are nurtured toward a deeper, more diversified and stronger relationship.
The CSM approach has the benefit of eliminating data and profile consolidation as a prerequisite for cross-channel marketing. With today’s marketing and cloud technology, all marketing programs can run on the cloud and the customer states can react automatically to actions and events happening in any application or platform. Data is still important, but data warehousing projects and centralization can be built after implementing your CSM programs rather than the other way around. Consequently, a marketer can start new programs and campaigns today and then focus on optimizing and building a data warehouse or customer centralization database. For example, one could start by implementing a customer reactivation program, move on with a cross-sales strategy, add more business intelligence, include social media in the mix, connect marketing programs with the CRM solution, and so forth.
CSM provides a refreshing alternative to the traditional marketing approach in my view. It has allowed me to build continuous marketing programs, optimize them with time and establish great marketing experience for customers. Beyond the ability to do better cross-channel and relationship marketing, the approach has had many positive results including quicker ROI, smaller initial costs, quicker implementation and increased marketing flexibility.
Alain Paquin is president and CEO of Whatsnexx.
Edited by Stefania Viscusi