Continuity Marketing Insights for Online Specialty Food and Beverage Sector... You've heard all the great statistics that continuity correct than not; it's incredibly hard to right a marketing programs bring to the table (i.e. automatically wrong impression. recurring order programs like subscriptions and auto-ship): So what are the keys to flawless execution? What must you 1) Continuity customers buy 3-6 times per year compared not do? Start with understanding the full life cycle of a to 1-2 purchases for average customers; continuity program. As seen in the diagram, the life cycle 2) Continuity offers maintain as much as 20% has many moving parts and requires thoughtful sequencing higher retention rates, and and synchronization. 3) The cost of keeping customers is only Promotion 20% the cost of finding a new Promotion customer. In this tight economy, It begins with successful continuity promotion - its programs can provide Payment relief to an positioning and its variableness. The key organization since to identifying it can offer promotions that elicit predictable “Re-Up” the best responses is revenue streams and inventory diligent analysis of existing demand. customer Yet, it's not uncommon Continuity buying upon launch of Marketing Inventory bHeohwa?vioUrtsi.lize continuity programs to find your results a CRM leaving a bitter system in aftertaste - such as, Surprise conjunction 50% higher & Delight with order and cancellation rates inventory and only 50% of management systems new customers make that reflect actual a second purchase. 1st purchase behavior and What happened? It should Shipment that can link purchase have worked right? Maybe it's time Customer revenue to products, to take a closer look at your online offers and all the specialty food and beverage business. Service associated customer data. This goes well beyond Continuity Marketing - website analytics to the post-sale activities that reveal invaluable clues to creating Food for Thought more effective acquisition and retention strategies. If you know, for example that 70% of all customers It's important to remember that continuity marketing is not that order the “recommended coffee of the week” just about the offer. The key to ongoing success and come back to order it at least two more times, then longevity to any premier continuity offering is in its flawless you've got the makings of a potentially lucrative and flexible execution. Think of it as the first impression continuity program that can be offered to new and we make when any of us meet a new person. We quickly existing customers alike. judge; we usually never change our mind; and we rarely
5 Burlington Woods, Suite 106 Burlington, MA 01803 www.ordermotion.com
What makes continuity difficult to execute is the complexity of managing the multi-payment structure that accompanies these types of offers. Capturing the initial payment is just the beginning of managing profitable campaigns – there's increasing risk of payment default the more you stretch out the payment schedule. And, this risk gets further compounded if you offer free trials or free shipping – it's important that payment charges be at the right price and at the right time. For example, do you collect 100% of taxes, shipping and handling on the first payment, or do you spread it out across 4 payments? Every program is different and you must have the flexibility to test which combination works best. Plus, you need to manage your bad debt workflow to ensure you're optimizing your collections – i.e. are you paying $1 in payment processing attempts to collect $0.50?
Along with a good payment management system, you should also have the ability to confirm inventory availability in real time. Why? If your customer leaves your site having submitted payment only to find out a week later that it's back ordered, you will not only have an angry customer tying up your phone lines, you'll likely lose that customer forever. Nothing kills a continuity revenue stream faster than back orders. The ability to remove items from your site once out of stock prevents back order situations from getting really ugly. Conversely, adding items back to your website once inventory has been replenished is just as important.
The first shipment, once received by your customer, is another opportunity to make a good first impression. This is especially true for new online customers because they don't have any experience with your brand and they can become dissatisfied very easily if you do not live up to their expectations. The ability to effectively manage customer expectations goes a long to increase lifetime value, customer loyalty and profitability. How? Communicate clearly and in detail the benefits of your offer and how the continuity program process works. For example, send a separate welcome email to customers after their first purchase in addition to any subsequent order status emails (i.e. order and delivery confirmations) ...