‘Know your customers’ isn’t just a phrase

Authored by Sudhish Sitaram, Regional Head of Marketing – India, Infobip

The concept and objectives of marketing have not changed much in the past few decades. However, there has been a significant evolution as far as its implementation is concerned. What customers get to see and experience versus what brands communicate to them, could often conflict. Advertising and marketing campaigns used to be one-way communications wherein businesses would just ‘announce’ their offerings through different channels. With the advancement of technology, the communication and interaction between brands increased and got more personalized. However, with us standing on the threshold of a new marketing era (with Google phasing out third-party cookies in late 2023), marketers will have to rely on first-party data for their campaigns. It is also crucial for them to be a part of the customer’s journey by gaining insights about what they require rather than simply following what they looked for on a search engine. 

The question now arises is how? The market dynamics are constantly changing. Their close analysis plays a vital role in retention, and it all comes down to the customer experience. The experience you create for your customers will act as the most significant factor that will affect the retention rate. Keeping the customers happy with your services and working based on their feedback will improve the overall experience. 

The importance of understanding your customer

It is crucial to go just beyond the demographics of your customers. A business should know their tastes and preferences to ensure that personalized touch to every campaign or message offered. Therefore, a company must effectively use data to find relevant ways to cater to its target customers. For instance, according to the 2019 MICA and Communication Craft study, most Indian consumers prefer YouTube as the primary streaming service compared to international customers. Such minor yet significant details about your target audience can help you choose the correct medium for marketing. Additionally, brands need to invest in chalking out the entire experience to make it stand out. But often, companies aren’t prepared to link CX and marketing in a meaningful way.

As mentioned earlier, the marketing trends will eventually shift from third-party cookies to unifying first-party data. To collect, analyze and utilize first-party data, marketers need a  customer data platform. This will empower marketers to access complete and actionable understanding of consumers instead of legacy systems that only offer data, which can be out-of-reach and impossible to activate. 

As per a survey, around 88% of customers expect brands to personalize the interactions. And since we are heading towards a cookieless world, businesses must engage with customers through interactive and conversational marketing tools such as such as live chats, chatbots, messaging apps, and social media (or the channel preferred by a customer).

Be where your customers are

Omnichannel communication is the right way to go. As reaching them on their preferred channel is a great way to improve customer service and overall experience. For instance, according to a Global Web Index (GWI) study, WhatsApp has emerged as the most preferred app for communication in India. With over 480 million subscribers, the country has the highest number of chat app users globally. Googles native channel for androids RCS has also helped several companies increase customer engagement. For instance, one of the leading InsurTech companies in India (who is also our customer) witnessed a 130% jump in CTR (clickthrough rate) by using RCS, often called the next step in the evolution of SMS.

The power and impact of customer retention

What is better than onboarding a new customer? It is retaining an existing one. The experience a brand creates for customers may be the sole determinant of retention. It takes a lot to earn a customer’s loyalty. Once someone is into your ecosystem, not just is it hard to let go, it is equivalent to incurring losses as a business. Why? Because acquiring new customers costs five times more than retaining the existing ones, and a 2% increase in user retention can have a similar impact on your profits as cutting costs by 10%. The numbers don’t lie. Retaining customers has become easier for marketers, thanks to customer data platforms. Now you can create hyper-personalized messaging campaigns with product recommendations and tailored offers, along with re-engaging dormant consumers effectively.

Summing up

The improvements in marketing campaigns attained through digital marketing could soon be a thing of the past. The primary reason is that the target customers are no longer limited to just one or two communication platforms as they were just a few years ago. To ensure that the overall effectiveness of a marketing campaign is high, a marketer must be a part of a customer’s journey by utilizing different tools that aid in better interaction. Businesses must take an omnichannel approach, understand how customers want to interact, and be present on their preferred channels 24x7. To put it simply, the more you know your customers, the more successful you will be with your products and services. After all, great customer experience brings in loyalty, which leads to a higher retention rate, and in turn, drives growth.