How To Improve Customer Acquisition with Multi-Touch Marketing CampaignsOctober 05, 2018
How many times do you contact net-new prospects when you run a customer acquisition campaign?
We’ve seen that marketers tend to choose one-touch campaigns when they run net-new prospecting. Yet, with over 25 years of net-new customer acquisition experience our data shows that net-new prospects respond better to multi-touch campaigns than they do to single-touch campaigns.
When running customer acquisition campaigns, multiple touches after the first touch typically have higher response rates and result in a majority of attributed sales for a campaign.
So why do so many marketers stop at one touch? It turns out that marketers often falsely assume that contacting net-new prospects more than once will result in poor response rates, past that first touch. They fear that prospects will fatigue quickly. One of the causes of this problem is that marketers are applying the logic of retention marketing to customer acquisition.
In the ‘retention/cross-sell/upsell’ phase of the marketing lifecycle, you often find customers who’ve recently made their first purchase or existing customers who’ve made a repeat purchase, who typically show a small window of opportunity to contact them where their engagement and response rate will be high. In this instance going beyond a single touch can indeed result in a significant drop in response rate. One touch is often about all you get with these existing customers before they tune back out for a while.
Retention vs. Acquisition Cadence
However, it’s important for a good marketer to understand the nuances of the marketing lifecycle and know that marketing to net-new prospects comes with its own set of parameters and realities that’s often different than cross-sell/upsell and reactivation efforts.
When in doubt it’s best to listen to the data. After running many thousands of customer acquisition campaigns across hundreds of brands, we’ve seen that multi-touch campaigns are quite often the best choice for customer acquisition. The later touches build on previous touches and often generate the bulk of responses and sales from the sustained contact later in the series, once marketers have built up brand recognition and established some mental equity with prospects.
It’s also wise to use a multi-touch approach to deliver different messages to their audience, where each touch focuses on something different – ex. the first focuses on brand recognition, the second contains a stronger call to action, and so on.
Take this example from one customer’s recent direct mail acquisition campaign :
This campaign’s mailing maturity typically takes 90 days, so to maximize the campaign’s effectiveness touches #1 and #2 (left) were sent out within 30 days of each other to increase the campaign’s response rate. The response rate showed no indication of fatigue, instead the response rate increased 2.4X with the 2nd touch in the campaign, and 5.1X between the campaign’s 1st and 3rd touches.
If this customer had run a single-touch campaign (right), they would only have acquired 10% of the customers that they did using multi-touch.
This isn’t to say contact fatigue doesn’t take place in customer acquisition. It certainly does. You still shouldn’t mail a new prospect too often or for too long. As you see in the example above, the ideal volume was a 3-touch series for that prospect pool. While each brand and campaign is different, bi-monthly to monthly contact for up to three months is a decent ballpark starting point for testing and determining a proper cadence for your new prospect list.
Taking Acquisition Performance Further With Predictive Analytics
Predictive marketing is changing entire industries, and according to a recent study by Constellation Research, businesses from all sectors will spend over $100 billion per year on marketing AI by 2025. If you aren’t looking to implement a predictive solution now, you’re likely to start losing business and getting behind the competition.
This is because predictive marketing is an excellent innovation that allows marketers to greatly improve their campaign targeting. The market has been stuck for too long on ‘digital personas’ that ad tech companies sell aggressively to marketers. The problem is, audience personas are an excellent way for ad tech companies to sell audiences and make a lot of money, but not really a great or efficient way for brands to target consumers. There’s immense waste with persona targeting and black-box digital ad tech. This is why the industry is now swinging back to people-based marketing where you know exactly who you’re targeting.
This push back to more direct response and sales-focused marketing has of course also led to the rise in modern predictive marketing tech. Predictive tools are a way to evaluate and score people, based on their likelihood to take action like make a purchase or respond to a campaign, but unlike personas it’s based on actual consumer data and real marketing lists.
Beware The Silver Bullet
Predictive targeting is a great step forward for marketers, but be cautious of any technology that promises to magically solve all your problems. Predictive targeting will, wait for it—improve your targeting—but it won’t solve all your marketing issues if you have other pre-existing conditions.
The reality is, even with state-of-the-art predictive consumer targeting, you can still get disappointing results if you fail to deploy smart marketing processes “up and downstream.” Having a predictive-modeled marketing list is a huge advantage and is quickly becoming the new gold standard for targeting, but as we described above, you don’t want to sabotage that edge with poor deployment practices, like applying a one-touch campaign where a multi-touch campaign is called for. Even superstar athletes can’t consistently win games all by themselves without a strong team behind them.
Ultimately, this is a reminder that all of the ingredients in a dish need to be high quality and you need to execute on the recipe well. We regularly advise marketers not to skimp on their targeting and to use data-driven practices, not guesswork or vague personas, when it comes to targeting consumers. We do this, because frankly, that’s the product we sell–software for better consumer targeting. But it’s equally important that you don’t skimp on the other parts of the process as well. Make sure you’re using data-driven practices to inform all your decisions: whether it’s targeting, cadence, messaging, channel, etc. Using a scientific mindset across your marketing will bring clarity and effectiveness to your efforts and greatly improve your results.