5 adjusting screws in the customer life cycle
Acquiring new customers is more time-consuming and therefore more costly than maintaining existing customers.
This is especially true in markets with long product lifecycles and low emotional differentiation among competitors.
Electricity, gas and water do not electrify in the same way as fashionable consumer goods or hip lifestyle products.
Therefore, in these industries, the customer lifecycle is the key lever for revenue and customer retention.
Of course, priority one: existing customers
While for new customers it’s all about gaining and maintaining attention, for existing customers the focus is on building on the existing relationship and increasing loyalty. The energy industry shows this very vividly: The willingness to switch electricity, gas and water is constantly increasing and is further fueled by sales and comparison portals (more on this in our white paper: “Marketing and sales in liberalized energy markets“). Of course, if you lose existing customers, you need at least the same number of new customers to maintain the status quo alone. Assuming that new customers cost around five times more than retaining an existing customer, priority one is clear: nurture existing customers – and develop new customers into existing customers.
1. customer life cycle – it’s the data that counts
Sales professionals and marketers in industries such as energy, as well as telecom or insurance, need more than others to gain deep customer insights and actively engage with their customers’ needs in order to make enticing offers. To do this, they need the right technical foundation and data, because the key to long-term customer loyalty is ongoing data-driven evaluation of customer needs at every stage of the customer lifecycle. Only those who know the life cycle of their customers can expand the customer relationship with valuable offers and increase loyalty. This is where udo helps.
2. customer value and potential analyses
Because udo von Schober offers detailed analyses of customer data, for example as a customer value analysis. Existing business partners and customers are systematized according to their previous contribution to sales. The respective customer value then shows which existing customers are particularly attractive in terms of sales and how their shopping cart can be increased. In the case of utilities, for example, the e-charging station can be an attractive addition to the electricity contract. In addition to analyzing the inventory, this also makes it possible to forecast the future potential for sales.
3. data quality and data networking – are the data up-to-date?
Practical tip: Unsure about your own data quality? The Schober Quality Check helps and provides you with a non-binding in-depth analysis of your data. We match your inventory with the Schober data universe (4.6 million B2B data, 58 million B2C data and over 80 million mobile IDs), determine the degree of up-to-dateness and concretely point out possible need for action.
4. personalized interaction with value or “off to the bathroom
Image source: ThisIsEngineering, Pexels
Customers only buy products or services if they promise benefits and added value. The same is true for customer interaction. If you want to retain customers and develop them into loyal existing customers, you also have to make customer interactions personally useful and of value. Purchase history, age and housing conditions offer initial clues for action. Truly personalized interaction, however, requires more: Can a new electricity customer be targeted with an annual ticket for the municipal swimming pools? To estimate this, one needs additional data. Those who have the necessary insights can also send marketing and sales to the right communication channels in a targeted manner with value-added interaction.
5. termination prevention through segmentation and personas
Deciding on the optimal product and communication strategy, the loyalty programs or the appropriate channels succeeds by first segmenting customers. Segments as bundles of characteristics can additionally be condensed into personas. Similar to a short biography, personas describe relevant customer characteristics in detail. These help to respond to customer wishes with maximum precision and to implement target group-appropriate measures.
But patterns can also be seen where terminations are expected soon. The “soon-to-be-terminated” persona can be won back – if it is recognized – before the termination even occurs. The attractive product combination of electricity, public transport and Internet or the new eco-electricity offer do wonders for customers. The company saves the cost of acquiring new customers.
Marketing and sales can actively influence the switching needs of end customers in a targeted manner by using existing customer information. But some fluctuation is inevitable – fortunately, even among competitors.
Develop new customers into existing customers? Who knows the set screws and has udo …
If you’re thinking “Sure, that’s great, we’ve tried that, but customer lifecycle management is very challenging,” you’re right. Yes, it is challenging. But at Schober, we’ve been shaping the future of sales and marketing for over 70 years. And so a cloud-based out-of-the-box platform for managing customer data (Customer Data Platform – CDP) has emerged from the method presented. We call the solution udo and think you should get to know udo. We’ll be happy to show you how easy udo makes customer lifecycle management.
Good luck and long live your sales!
Your Schober Team
