Overwhelmed by how often companies you have a relationship with get in touch with you? You’re not alone – companies have lost all control around how frequently they are communicating with their customers. It’s due time they take a look at their communications practices and make amends…
Something we as consumers can all universally agree on is that the proliferation of channels over the past several decades has been a good thing. It used to be that the retail shop and contact center were the only ways we could engage with companies; now, from the convenience of our couch, we can buy clothing, pay a bill, lodge a complaint, etc., without moving more than a muscle or two. There are now more than half a dozen unique channels we can use for engaging with our service providers through (contact centers, shops, company website, social media sites, email, mobile apps, kiosks), with new channels sure to be developed and launched over the coming years as well.
Proliferating as well during the same time has been the number of products and services offered by companies (regardless of sector); this, in turn, has led to the skyrocketing of the number of campaigns ongoing at any given time by any given company. From new products to holiday-specific sales, partnership promotions to bundle offers, marketers are more active now than they have ever been inside companies.
Take these two trends together and it’s obvious why things are out of control when it comes to customer communications. Companies are bombarding their customer base with emails, SMS, phone-calls, auto-dials, pop-up ads, etc., at a record clip. According to Retail Mail Blog, in 2012, top retailers sent out an average of 210 promotional emails to their customers. That’s translates to roughly four emails a week, and that’s only one channel of communication! Accordingly, a survey in January, 2013 (conducted by YouGov) found that 75% of respondents said that they are overwhelmed by retailer emails.
We suspect that if executives of companies had any idea of the amount of communications taking place with their customers, they would be shocked; essentially many have become spammers, without even realizing it. One-to-one communications with consumers has gone unchecked, and with the proliferation of channels and campaigns, has become a serious issue companies need to address.
We believe that an effort consisting of six steps can help companies set the right level of communications with their customer base.
1. Segment Communications: The first step is to identify the various types of communications that are made with the consumer base, and categorize them based on type. The purpose here is to separate between those types of contacts that are essential and have to be made, and those that are optional. The focus of this effort is to ultimately set the right level of optional communications with customers, and as such, they need to be segmented and separated. Generally speaking, there will likely be two types of communications identified:
2. Segment Consumer Base & Assess Current Volumes: Once the above has been completed, the next step is to understand the volume of communications taking place with different segments of consumers. Segments here does not imply those that are being used inside the company only (i.e. high-value, mass, youth, etc.); rather, it means around products, channels, etc. – the number of segments that can be examined are only limited by the number of combinations that can be defined based on the variables used (i.e. high-value multiple-service subscribed newcomer that is SMS opted-in, as one example of a segment that can be examined). The goal here is to first understand the existing level of communications with various segments, then, identify outliers (those relatively being over-communicated with or under-communicated with). An example of what this output would look like (with red over-communicated segments, yellow under-communicated segments):
3. Set Targets For Communication Levels: The next step is to determine the right level of communications that should be taking place with the customer base (in general) and various segments. One size does not fit all, each segment should have a level set for it – for example, newcomers are relatively more open to accepting offers, thus, over-communicating with this segment may be a wise decision. On the flip-side, over-communicating with high-value customers may cause more harm than good, pushing consumers in this segment to start ignoring the communications. A minimum barrier should also be set (i.e. at least one contact a month) for the entire base, such that some type of pitch is made with every customer – many may fall through the cracks based on the campaign filters and channels used. Though consumers prefer minimal communications in general from their service providers, they nonetheless need to be “touched” at least once in a promotional sense.
Focus groups and surveys can be conducted with consumers here to set these levels. Understanding their preferred volume of contacts per month, their channel of contact preferences, the point at which they start ignoring communications, etc., can be tested with the various segments, helping to guide this level-setting effort.
4. Design Communications Rules & Processes: The next step is to set up the mechanism for determining which communications are to be made with what consumers, via what channel, and how the communications are to be monitored. If, for example, a decision has been made to reduce communications with newcomers to 6 a month, and the current number of contacts is 12, 6 need to be eliminated.
A framework needs to be designed that prioritizes communications for the various segments, and, as well, a complementary process that ensures communications are capped and stopped if monthly communication target thresholds are hit (this can be done manually or through built-in solutions in various campaign management systems). A general rule of thumb to follow would be to prioritize those communications that have had the highest positive impact in the past (in terms of generating revenues, increasing customer satisfaction, etc.); aside from this, a segment manager or an assigned employee should be the last word here around what should or shouldn’t be communicated that month with the given segment.
5. Test Segment-Specific Communications Strategies: Before rolling out the effort and applying to the entire customer base, we recommend tests be conducted with each of the segments to determine the effectiveness of the designed approach; the desired outcome is a positive impact on the bottom line as well as a more receptive / less-irritated client base. As such, those communicated with using the new rule-sets should be examined from an ROI perspective; ideally, they will have a higher offer acceptance rate vs. those that have been communicated with in an un-regulated manner. Modifications should be made based on the findings, if necessary (i.e. ramping up or down communications, changing the channel of communications, etc., until the optimal level and channel of communications per segment is realized.
6. Conduct Relevancy Analysis (optional): An optional step is to conduct a relevancy analysis, filtering out the junk that gets sent to customers; this will also help with reducing the level of communications being conducted. We all as consumers have and continue to receive irrelevant and wrongly targeted SMS, emails, etc., communications which serve minimal purpose, which ultimately may have a detrimental impact on the bottom line as they desensitize us to relevant pitches.
By conducting a historical analysis on response rates by various segments to the numerous types of offers they have received in the past, many communications can be banned from being conducted in the future. Segments examined here for responsiveness to offers should be more than just those listed in the examples above – for example, responsiveness by gender is worth examining, as it may vary significantly based on offer type (i.e. pitches around discounts being offered by retail clothing partners of a certain bank / credit card may have an extremely low response rate from men historically, so low that the communication should not be sent in the future, as it dilutes and diminishes the potential response to offers that are more relevant for this segment).
We believe that by taking the above steps, companies will realize in a very low cost manner a positive increase in ROI around their below-the-line marketing efforts. At a minimum, they will go a long way towards shifting customers towards listeners again, such that they will review the communication they receive, rather than discard it as spam.