Attracting new customers is only one part of a company’s growth equation. Customer loyalty often yields better ROI than acquisition programs, especially in industries with long sales lead times.
Retaining customers not only costs less than attracting new ones, but it also opens up opportunities to cross-sell and up-sell. For now, we’ll focus on customer retention. Customer lifetime value (CLV) is a hefty topic in its own right, although there’s a natural overlap between the two.
Customers don’t just want personalised experiences. They expect them.
Personalised marketing “punches above its weight”, as McKinsey put it in a 2021 report that found companies with mature personalisation capabilities generated 40% higher revenue from marketing activities.
When asked about personalisation actions, 67% of customers said relevant recommendations were important, second only to seamless customer experiences (75%). Tailored messaging ranked third (66%), with celebrating milestones (61%) and timely communications tied to key moments (59%) also ranking as top priorities.
TAP CXM helps global brands reach a first-name basis with customers. See how we work with some of the world’s best-known brands.
End-of-contract renewal messaging refers to the strategies that engage customers nearing the end of periodic agreements, from free trials to 12-month contracts or longer.
It’s an opportunity to nurture existing relationships, reinforce brand loyalty and increase the likelihood of renewal. By tailoring communications based on individual customer preferences, needs and behaviours, brands can deliver better customer experiences and improve retention rates.
Our CXM consultants have been busy designing and implementing renewal workflows to help clients boost retention rates and build brand loyalty. In particular, our recent work has focused on the insurance industry, where retention rates are among the most pressing challenges for players of all sizes.
Before lifting the curtain on contract renewal, we need to reiterate the importance of customer centricity. Customers respond to empathy. But they’re smart – they’ll spot a performative ploy from a mile away.
Be authentic. Create content with customers in mind, not revenue targets. Become the helpful partner, not the pushy salesperson.
It might sound counterintuitive for a financial services industry like insurance, but a human touch is significantly more effective than pressure selling.
The first steps to any effective marketing activity are:
That way, the parameters and priorities are in place for marketing to generate ROI that contributes to business growth.
First-party data is essential for effective personalised marketing – or really any CXM activity. Implement a customer-centric marketing approach to plug data gaps and enrich customer profiles.
Conduct thorough customer analysis to segment customers based on enriched data. Segment based on preferences, pain points, policy usage and renewal triggers rather than relying on demographics.
Tailor messages and offers based on individual customer profiles, leveraging insights from customer data and past interactions. Test different messaging strategies and use the results to refine your communications.
Don’t forget to personalise the channel as well as the message.
Build custom contract renewal workflows using a fit-for-purpose solution like Adobe Campaign to streamline the renewal messaging process, ensuring timely and consistent communication.
Ensure the workflows are segmented and adaptive. By that, we mean:
Monitor engagement and conversion rates using a test-and-learn approach to continually improve customer experiences.
Martech plays a vital role in improving end-of-contract renewal messaging. It helps organisations manage customer data, automate workflows, deliver dynamic content and measure engagement.
But tech alone isn’t a silver bullet. For example, martech can’t:
So before investing in new technology, it’s worth reviewing existing capabilities. In our experience, customer retention issues are much more likely to arise from inefficiencies in data management and strategy than underperforming martech.
Although these structural issues are trickier to solve, they’re significantly more valuable for companies and customers alike.
Don’t buy new martech without reading our guide to investing in better marketing.
Personalised marketing depends on first-party data. First-party data comes from customer interactions.
It’s a little ‘chicken and egg’; sending irrelevant communications turns customers off, but you need touchpoints to gather data. We’ve found these strategies helpful:
Boston Consulting Group found that 90% of people are willing to share their data when presented with the right value exchange. So, our final piece of advice?
Don’t be shy.
TAP CXM’s consultants can help you analyse, enrich and use customer data to improve loyalty. Whether consulting on best-practice personalisation strategies, building custom Adobe Campaign workflows or delving into your database, our support is tailored to your needs.