Is lifecycle marketing outdated?
Everyone talks about lifecycle marketing – but is it still a useful strategy for email marketers?
This is a controversial topic, especially because we know how well email aligns with points in the customer lifecycle. A blue-ribbon panel of email experts debated this concept fearlessly during Holistic Email Marketing’s recent discussion, Email & More … Lifecycle Marketing & Automation.
If we have learned anything about email marketing over the last 20+ years, it’s that the field is always changing and innovating. These 4 takeaways offer concepts that will help you understand the state of lifecycle marketing and where you need to improve.
Lifecycle marketing and marketing automation are not the same.
Many marketers use these terms interchangeably, but our experts said it’s important to understand why they’re different and why the differences matter.
Scott Cohen, CRM director for SmileDirect Club: “Lifecycle marketing should be viewed as the umbrella term with all marketing components sitting underneath. Marketing automation should be viewed as a function, rather than a strategy. Your goal is to automate as much of it as possible so you can do other things.”
Ryan Phelan, managing partner, RPE Origin: “Lifecycle marketing is the strategy, and marketing automation is the tactic, and we marketers have to draw a line between the strategic and tactical layers. Now I have a strategy. How do I execute it?
Kath Pay, founder/CEO, Holistic Email Marketing: “Everyone sees it differently. It’s very subjective. My take is that if you look at all the automated programs, they are lifecycle. They are talking about a particular segment or a one-to-one campaign based on behaviour or life stage, not just one action.
“What makes them different is the lens through which they’re looked at. Lifecycle campaigns tend to be customer-centric. They typically address the customer at a time that is most relevant to them and is based on unique criteria. Whereas marketing automations are business-oriented and focus on how to drive business objectives forward.”
Elizabeth Allen, CRM project manager for UNIQLO: Marketing automation is a broad term and is linked to lifecycle marketing. Ideally, you have automated your lifecycle marketing. The objective is to encourage customers to purchase again with your brand. You wouldn’t want that to be a manual process.
Marketing automation is a post-action trigger – if you purchase in-store we send you an email to encourage a review. Lifecycle marketing would be different per customer depending on what actions they’ve taken. If you have someone who hasn’t purchased recently, they would get a different email campaign; whereas, every customer would get the same post-action trigger.
Scott Cohen: “I view lifecycle marketing as the umbrella term. All good marketers should be doing lifecycle marketing. Marketing automation is a function of lifecycle marketing. It’s not a strategy by itself. It powers lifecycle marketing.
How we understand and use lifecycle marketing needs to evolve.
The path from awareness and action isn’t as simple as we thought it was years ago.
Ryan Phelan: “In 2006, when I was with Responsys, our job as marketers was to show people how to shop online. It became a linear concept that explained how people interacted online with brands.
“Today, the customer dynamic is so complex, there’s no linear analysis anymore. The customer can come to you and buy instantly, or they can have a long consideration cycle. They can look at discounts or pay full price. That’s a non-linear path.
“What does lifecycle marketing even mean anymore? It’s an outdated concept that has to be updated to current consumer behaviours. You can still have phases but the linear path that has been described for the last 10+ years is not how we envision a customer’s, subscriber’s or prospect’s interaction with the brand. It’s not realistic.”
Adeola Sole, Holistic Email Marketing: “The way people buy, the way customers self-segment themselves have changed. A brand would segment customers based on monetary, for example.
“Its VIPs or high-value customers would equate to some amount of money spent over a specific period. But ‘buy now-pay later’ customers would look low-value in comparison but would be buying more frequently in terms of how they shop. So that affects how you do post-purchase emails.”
Scott Cohen: “Nonlinear was true in 2006. I worked in higher education, and we had some people show up who were ready to go and some people came looking for information, and you had a 2-year consideration cycle. It’s the same at the company I work for now.”
Choose metrics to measure the success of your lifecycle strategy based on goals.
The open rate does not measure success. Look instead at what you wanted to achieve with your lifecycle marketing programme.
Elizabeth Allen: “Before measuring the success of your lifecycle strategy, you must first have a clear goal of what you’re trying to achieve. Then you can look at what your success metrics should be.
“If your goal is to increase your active customer ratio, if you have a percentage in mind that’s an obvious success metric. If you’re looking at how many people repeat-purchase, how many people open your emails? But first, have a clear objective.”
Kath Pay: “Each lifecycle stage will have its own objective. With email, acquisition will have a different goal from winback or retention. You have to look at that and decide which will be the best metric and go with whichever metric supports or goal.”
Ryan Phelan: “It’s hold-out groups – also called control groups, which every company hates because you are excluding 10% of your audience from receiving your campaigns. Everyone gets welcome and transactional emails, but no promotional emails. That control group is the one universal way you can determine what your lift is, what the effect of your email programme would be, compared to people to people who did get your emails.”
Kath Pay: The goal is to see the uplift from automations. So rather than excluding your control group from everything, exclude them only from lifecycle campaigns and programmes so you can determine how much uplift in revenue these programmes really produce.
8 best practices for A/B split testing
Meaningful testing is an essential part of any email marketing programme, including lifecycle messages, automations, triggers and the like. These eight best practices from our experts will help you create and manage an effective testing process:
- Be prepared for a test to fail.
- Know why you want to test first. What is the purpose of the test? Is it to determine a winner or to perform flat so you can replace something? A definitive statistically significant winner means testing to win. Flat to replace means it needs to perform as well as the current version in order for it to be replaced.
- Give your tests plenty of time to run. Your tests should be carried out over a period of time. Tests should focus on a goal and strategy as well as being documented clearly. Automations need a longer period of time to gather results in comparison to BAU campaigns.
- Always begin with a hypothesis. It should include what elements you are testing and what you think might happen when you apply a variable.
- Write down what you learned in your test. Always test for learning. The more your tests show you, the more you learn about your opportunities.
- Choose the right metric when testing subject lines. More often than not, open rate is not the right metric. It should be the one that supports your objectives or goals. If you want to find which email content will drive higher revenue, conversions would be the metric to look at.
- Test beyond the subject line. Testing the subject line tells only part of the story. If opens are strong but conversions are low, then there is room for investigation. Perhaps the content, messaging or even the website needs to be optimised.
Watch the video for the full discussion
We gave you just a taste of the strategic and tactical discussions that kept our panellists talking, disagreeing and eventually reaching a consensus on the questions. Watch our recording at your leisure to hear more details on using control groups to measure lift from your email programmes, the specific metrics that can help you measure success, the differences – if any – between customer journeys and lifecycle marketing and A/B testing.
Want to learn more about how to update your lifecycle marketing programmes to reflect your customers’ current behaviour and preferences? Call or send us a note. We’d love to talk with you – no obligation!