Technology is changing the way people today purchase and form brand loyalties. Today’s consumers expect brands to reach out to them in a way that offers value and keeps interest. Gone are the days of interruptive advertising making a real or lasting positive impact.
What is Impacting Consumers?
It’s important to understand that consumers are not moved by repetitive or interruptive marketing like they once were. In today’s oversaturated market, it’s hard for a brand to make a real impact among consumers. TV commercials, billboards, cold calling and other traditional forms of marketing are only pounding more branding on an audience that has been hardened from years of similar ad techniques.
Image via Flickr by Free for Commercial Use
With technology changes, brands are able to make a bigger impact in ways that are more cost effective but time consuming. The new marketing techniques have realized that a customer-centric approach is not only possible, but much more likely to yield lasting results. This has resulted in both inbound marketing and–more recently–next best action marketing methods that help businesses find and nurture new leads.
What is Next Best Action Marketing?
Next best action (NBA) marketing is focused on gathering information about consumers in order to make the business model better fit the need of the target audience. With this marketing system, professionals gather, sort and implement data from their customers across their entire company. The name itself (next best marketing) is pointing to the underlying method of using new data to continually identify the next best step in the sales process for every prospect.
Examples of next best marketing at work can be seen in many industries. Most service professionals, for example, are trained in a form of next best marketing. A waitress is likely to talk to a patron about personal taste preferences before suggesting an item on the menu and a good waitress will also likely suggest add-on items, like drinks or appetizers, to further boost sales. While this obviously leads towards direct revenue for the business, there is also a personalized services aspect that is looking out for the desires of the consumer and cultivating a good consumer-business relationship. A patron that leaves a restaurant satisfied by a delicious meal is far more likely to return.
In similar ways, hair dressers, hotel staff and retail makeup consultants all work with their prospects to sell as many relevant products or services as possible. Even in nonprofit industries, organizations often use NBA practices to request appropriate donation rates and garner useful volunteer services for their cause.
Not only do next best action marketing strategies help companies better approach their qualified leads with a tailored pitch, but those same strategies can also help businesses determine the likelihood of future purchases and the cost-to-benefit ratio for each acquisition. This means that businesses can better assess how they are spending their money to bring in new consumer groups and which leads they should pursue further for future transactions. The more a business is able to segment leads, the better that business will be able to reach each individual prospect, lead or acquisition.
Next Best Action Marketing vs Inbound Marketing
While NBA and inbound marketing can go hand-in-hand in a business strategy, they are not the same thing. Inbound marketing focuses on putting out content designed to draw prospects in and cultivate them towards acquisition. Next best action marketing is a direct conversation with the prospect to find out where the next best step lies in moving them towards cultivation. While inbound includes a stagnant library of information in the form of a corporate blog, white papers or email archives, NBA uses opt-in calls, meetings or emails to form a give-and-take conversation to direct the process.
On one hand (inbound marketing), consumers are left to find the information for themselves, which works well for drawing in new leads and informing them about the company. Harvard Business Review found that inbound marketing and advertising can often add to the overwhelming chaos and push their prospects away with the misinformed idea that more content will hold the attention of a lead. Rather than understand the valuable nature of a strong inbound approach, brands have taken the easy road of churning out content in the hopes of creating a sticky web for their prospects.
On the other hand (next best action marketing), consumers are directed with a concierge-style marketing effort that helps direct them towards what is best for their ever-changing needs. This is only an effective approach when dealing with a lead that is qualified and interested.
Combining Strategies for a More Robust Approach
You might be able to see, then, how these methods can work well in tangent. Next best action marketing does not work well if the leads are not qualified, since the sales team wastes a lot of time on trying to cultivate uninterested prospects. On the other hand, inbound marketing can fall short if prospects do not have the personal drive to push for more information and find answers for themselves.
A combined strategy might include inbound marketing efforts to bring in new leads and help them convert to opt-in contacts. Then, the company or organization can use those willing and interested contacts to approach with a Next best action marketing strategy for moving them further down the sales funnel. Finally, a combination of segmented emails, supportive inbound marketing and continued NBA conversations can turn customers or clients into loyal brand advocates. A brand advocate is not only more likely to purchase again in the future (reducing the cost spent on new leads), but is also more likely to pass along positive recommendations to friends and family.
According to the White House Office of Consumer Affairs, Return on Behavior magazine:
- A brand typically sees a 60%-70% likelihood of selling to an existing customer, but only a 5%-20% chance of selling to a new prospect
- Increasing customer retention by just 2% has approximately the same effect as reducing overall business costs by 10%
- Loyal customers are worth up to ten times as much as their first purchase
Working Towards a Word-Of-Mouth Marketing (WOMM) Strategy
Though more outside of the brand’s control, working to establish loyal customers is more likely to result in customers that speak in a positive light on behalf of the brand. These brand advocates are formed when they believe in the value of a brand and want to tell their friends, family and workplace peers about their experience. According to ACI Scholarly Blog:
- 92% of consumers report trusting recommendations from their friends and family over any other kind of marketing
- 50% of all purchase decisions are influenced by word-of-mouth
- 1,000 customers talking about a brand can generate 500,000 conversations about that brand and two thirds of all social brand mentions (66%) are positive
By working to establish a valuable company that centers on the needs of the customer, a company or organization is able to create a loyal customer base to publically spread word of this value. Brands will see their initial investment in obtaining and cultivating leads multiplied when those leads continue to make future purchases and influence others to do the same.
When fully combined, these marketing strategies (inbound, NBA and WOMM) can create the kind of experience that offers the most customer-centric approach available and allows a brand to reach its full potential audience. This combined strategy helps brands and organization successfully set themselves apart from the other options in their industry and create a brand that does not get lost in the shuffle.