Five Minute Marketing Analysis
by Daniel Reid
NetLiance Corporation

How to use the Customer Engagement Model to increase effectiveness of your marketing activities.

Like many business owners you know that a thriving, growing business means happy customers and more revenue. It also requires the right decisions. But, where do you find the time to do the research, weigh the options, and confidently make the decisions you need to make.

Quick and effective ways of assessing business processes can be quite helpful. In our approach to developing web sites and web marketing programs we have expanded on the Customer Engagement Model to help clients identify and/or clarify their objectives and develop an effective solution.

Customer Engagement Model to the Rescue Looking at your business from the perspective of how you 'engage' customers is a simple, yet powerful, way of understanding and identifying possible problem areas. At worst, it can shed light on what you're doing right to help keep you on track.

Retain     Convert     Acquire     Reach       Customer Engagement Model

Reach Stage
The first stage in the engagement process is the Reach stage. This is where you try to get the attention of prospects and customers, and make them aware of your 'promise' or your unique selling proposition (USP). Everything you do will influence your reach.

Activities in this stage are communication-based. Print ads, radio, word-of-mouth, flyers, search engines, direct mail, email marketing, and newsletters are all good examples of Reach stage activities.

Acquire Stage
Successful efforts at the Reach stage increase the number of prospects entering the Acquire stage. At this stage you have "acquired" their attention. In other words, they have taken an action to further investigate your promise most likely because they are feeling the pain or need that they think your promise can remedy.

Maybe they call or visit your store or your web site or click on one of your banner ads. This is where you have your chance to deliver on your promise. At this stage you need to reemphasize that promise and instill the confidence that you can deliver. Remember they most likely wouldn't be at this stage unless they were driven by need or pain.

Convert Stage
If your promise meets their needs then they will want to take action on that realization. Their action indicates they have entered the Convert stage where they will gladly complete an information request form, sign up for your mailing list, or, quite possibly, place an order. Make this stage as easy as possible as this is the stage where the prospect senses the biggest risk. Many businesses make this stage too complex or fail to lower the perceived risk of the prospect, and lose them at this stage.

Retain Stage
A satisfied customer will return to do business again and, by doing so, enters the Retain stage. This stage comprises offers for upselling, upgrading, and discounting based on purchase history or even referral history. It is important to have 'special' promotions targeted only to customers in this stage so as to make them feel their loyalty is appreciated and rewarded. Don't have an introductory discount for new prospects (Reach stage) without having an offer of similar value for loyal customers in the Retain stage. A good example is how frequent flyer miles are earned as a customer's loyalty increases over time.

This is the most valuable stage as repeat customers are the most profitable customers over time. In fact, calculating the lifetime value of a client is an excellent exercise for budgeting for each stage. For example, if your business does not realize a long term value from a client then you may want to implement a referral program for active clients. In other words focus on using existing clients to further your reach efforts.

On the other hand, if customers tend to generate repeat business you may want to lower your initial pricing to make the conversion stage easier, and funnel a percentage of your Retain stage revenues into your Reach stage activities to make up the difference.

Summary
With the Customer Engagement Model in mind, you now have a basic framework to analyze the effectiveness of your own engagement processes. Are you trying to Convert at the Acquire stage? Are you trying to sell or satisfy at the Retain stage?

To improve your engagement process you can now consider various solutions including web technologies in the context of these stages.