Yoplait’s Cause Marketing Deepens Customer Engagement

The Challenge: Companies can deepen their engagement with customers by championing powerful causes. However, in order for these efforts to be effective, customers must feel that your efforts are authentic and truly helping the charity.

When brands are effective with cause marketing, it can also be a win for the product category. Yoplait®’s successful Save Lids to Save Lives®program was ranked number one by shoppers as the brand they purchase most because of its association with a cause. Not only has Yoplait, as a brand, benefitted from high awareness and purchases resulting from the 13 years supporting Susan G. Komen for the Cure, but the yogurt industry as a whole has been elevated. The yogurt category is ranked 5th among products consumers purchase because of their association with a cause.

Keep In Mind...

After selecting a cause for your company that you, your employees, and your customers are all passionate about, the next step is to make sure that not only the charity gets something from the partnership, but that customers feel good about it too.

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A win-win situation for the charity and your customers should be the goal; this is achieved when customers feel their life is enhanced by the charity efforts and that good feeling is transferred to how they feel about the marketer.

If you are wondering about the financial return on investment, according to Edelman’s annual goodpurpose® study, in 2012, 47% of consumers made purchases from brands that support a cause.

Takeaways:

1.	Ensure that your customers connect with the charity and approve of the way the campaign is executed. When choosing between two companies with similar products that engaged in cause marketing, 70% of those surveyed cited “personal relevance of cause” as the reason they choose one company over another.
2.	Make sure your cause relates to your brand. Coca-Cola, known for polar bears in their commercials and on their cans, teamed up with World Wildlife Fund. Donations from the campaign helped raise awareness for the conservation of polar bears’ habitats.
3.	Be transparent about how you are distributing funds to the cause. Show the results and the progress made as a result of your charity partnership.
4.	Make sure the cause you choose has the highest grades. Research the history and rating of the charity and understand the guidelines, rules, and laws governing companies that make charitable donations through marketing campaigns.
5.	Incorporate social media into your campaign so that donors can share their charitable efforts, thereby increasing the reach. Bing’s partnership with DonorsChoose.org benefited schools with a contest that called for entries through social media. Make sure everyone receives value and reputations of all parties involved are enhanced.

40% of Customers Buy More with Personalized Messaging

The Challenge: If you are not creating a personalized preference-driven experience for your customers, they’ll go looking for that type of experience--with your competitors.

According to a study by MyBuys , an e-tailing group, 40% of respondents stated that they buy more from retailers that personalize their shopping experience across channels. Addtitonally:

  41% buy more from retailers that send them personalized emails

  39% buy more from retailers that personalize Web recommendations.

The study noted that the practice of tailoring offers and promotions to consumers based on their past shopping or browsing experiences appears to increase buyer readiness, engagement, and sales activity. These findings are reinforced by sales data from MyBuys' database of some 250 million shoppers: Customer-centric marketing delivers a 25% increase in total online sales and a 300% improvement in customer lifetime value, according to the company.

Guitar Center, the world's largest retailer of musical instruments, not only understands the value of personalized customer service and engagement marketing, they’ve actually won the “Customer Engagement Award” from Retail TouchPoints, for embracing customer engagement and implementing solutions and services that are actively getting customers involved in their own experience and buying process, while improving their bottom line.

In addition to allowing customers total access to all instruments in the store, the ability to interact with industry professionals, and a chance to take their amateur talents to the next level, to the company also endeavored to improve the in-store customer experience even more by introducing, the “Find an Expert” profile pages. On these web pages customers can search for employee/experts online by location and store to develop dialogs and working relationships with these Guitar Center, (GC), experts based on similar musical tastes and interests. Customers can regularly engage with GC experts via email, through their blogs, and in-store. Additionally, in 2012 the company introduced a Music Mentor Series, an unprecedented company-wide platform that gives customers the ability to advance and enhance their musical pursuits, right in their own communities. Activities for the Music Mentor series included free music lessons.

Key Takeaways:

•	Differentiate your company by providing personalized experiences, communications, and offers.
•	Provide clear ways of showing customers that you're listening to their feedback and creating personalized experiences. This will reinforce ongoing participation by customers.
•	Personalized follow-up emails that detail items or events specific to the customers’ interests and buying history are value-added triggers that are welcomed by customers.

Focusing on Relationships, Not Sales, Generates Greater Revenue

The Challenge: Traditional marketing has often focused on getting the sale. Instead, marketers should focus on retention and how to keep more customers for longer periods. Customer Lifetime Value, (CLTV), is a simple equation for helping you calculate the value of increased retention.

By understanding the lifetime value of a customer, you can determine whether you are spending enough to keep and groom customers, and what the resulting revenue will be from ongoing, repeat, purchases.

Insert actual or estimated numbers into the following lifetime value equation:

(Average Value of a Sale) X (Number of Repeat Transactions) X (Average Retention Time in Months or Years for a Typical Customer).

Kellogg Professor John Parker explains, “Organizing marketing to improve the performance of three key ingredients–lowering acquisition costs, raising total margins, and reducing the churn rate–can be an even more powerful application of CLTV for CMOs.” Research from Bain & Company shows the increased value of customer retention versus acquisition:

•	Acquiring a new customer can cost 6 to 7 times more than retaining an existing customer
•	Over a 5 year period customer attrition rates could reach as high as 50% if databases are left dormant
•	Businesses which boosted customer retention rates by as little as 5% saw increases in their profits ranging from 5% to a whopping 95%.

 
When we focus marketing efforts on customer retention rather than acquisition and engage customers throughout the entire relationship, the result is an increase in the lifetime value.

3 Takeaways for Marketers:

1. Engage with customers at 3 points in the customer lifecycle:

•	Pre-Sale: Understand their needs and preferences and begin engaging them accordingly.
•	Sale: Don’t think of the sale as a “close”. The sale is not the end; it should be the start of building a proactive, value-based, relationship.
•	Growth & Retention: The period between the last sale and the potential next sale is an opportunity for you to provide ongoing, proactive, engagement, and value. This is the time to gain a better understanding of your customers, why they purchase from you, what motivates their purchases, and how you can provide value between purchases, to keep them loyal and engaged. ERDM research shows that engaging and forming strong relationships with customers has 12 times more influence on retention and repeat purchases than customer satisfaction alone.

2. Cut down on email blasts and send only relevant, preference-based communications. A powerful way of proving that you care about your customer is to cut down on email blasts and only send targeted and relevant communications and offers. Consumers resent brands that indulge in “spray and pray” blasts of irrelevant email. This is viewed as disrespectful of their limited time.

3. You are probably not spending enough on your top customers. Identify the top producing customer segments and revise your spending accordingly. See the visual above.