2. Integrated Strategies for
Customer Loyalty and
Value Optimization
Presented By:
David Azulay – The Kern Organization
Judy Mitchell – The Kern Organization
Dan Ferguson – DIRECTV
Karlene Swalley – Clearwire
2
3. “This may seem simple, but you need to give
customers what they want, not what you think they
want. And, if you do this, people will keep coming
back.”
- John Illhan, Entrepreneur and Founder of Crazy John's
(Mobile phone retailer)
According to research done by Bain & Company:
No company is immune to the pressures of the market.
But companies that focus on building loyal relationships…
are better positioned to remain strong.
3
4. Consider the cost of serving a long-standing
customer versus the cost of courting a new one…
5% increase in customer retention produces
more than a 25% increase in profit
Why?
4
5. Return customers tend to buy more from a company over
time, and as they do, the cost to serve them declines
Customers often pay a premium to continue to do
business, rather than switch to a competitor with whom
they are unfamiliar and uncomfortable
5
6. Today’s Agenda
Introductions
The Importance of a Customer Communications Strategy
Getting Started –10 Key Steps
Cases –DIRECTV & Clearwire
Moderated Panel Discussion
Q&A
6
7. Introducing Our Panelists
David Azulay Dan Ferguson Judy Mitchell Karlene Swalley
Senior Vice President, Senior Director of Vice President, Senior Customer
Client Services, Marketing, Client Services, Base Marketing
The Kern Organization DIRECTV The Kern Organization Manager,
Clearwire
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8. The Importance of a Customer
Communications Strategy
Just as important to have retention strategy in place as
acquisition strategy
It costs more to acquire a new customer than it does to
keep one
Most customers want to be appreciated and thanked along
the way for their business
Expectations are increasing. Customers expect their
experience to be consistent, relevant and personalized at
every touch point
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9. Getting Started – 10 Key Steps
1. Know your objectives
2. Define methods of measurement and success metrics
3. Conduct a communications audit
4. Listen to your customers
5. Determine customer lifecycle phases
6. Define targets and messaging
7. Plot the journey
8. Set Test and Implementation Plans
9. Create a brand
10. Go to market and refine again
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10. Step 1: Know Your Objectives
Primary –Should be quantifiable
• Example: Increase revenues by 10%; Increase renewals or mitigate churn
by xx%
Secondary –Should be extensions of meeting primary goals
• Example: Satisfied customers and advocates, which lead to increased
purchases and increased revenues; increase customer opt in; generate buzz
Are these realistic?
• Align costs and ROI to meeting your goals
10
11. Step 2: Define Methods of
Measurement and Success Metrics
• Improved customer satisfaction scores
• Positive testimonials
• Lower churn rates
• Increased revenue or
purchases
• New customer referrals
• Higher online registrants
• Other qualitative and quantitative measures?
– Always good to look at more than one
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13. Step 3: Conduct a
Communications Audit
• Dedicate resources – commit 2-4 months
• Review all existing metrics
• Analyze impact of current touches on costs and revenues
• Perform competitive analysis
• Evaluate current offer library
• Build a map of existing communications
to identify gaps/holes/opportunities to
better address customer needs
• Result should enable specific plans by segment,
customer type, etc.
13
14. Step 3: Communications Audit
Evaluate contact strategy variations
based on customer segment
Questions to ask yourself:
What actions do you want
prospective customers to take as
they move through their
relationship with you?
What channels are they likely to
prefer?
What will define success for each
type of dialogue?
Be sure to make improvements based
on findings
14
17. Step 4: Listen to Your Customers
• Use immediate feedback channels
– Surveys, one on one interviews, focus groups
• Build longer term feedback channels
– Customer panels to contact regularly for feedback
• Be prepared to act on the information you hear
– Customers appreciate being asked
for their feedback but expectations
are that their opinion will be taken
into account
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19. Step 4: Listen to Your Customers
SURVEY FOLLOW UP TREATMENT
Weekly
1 2 3 4 5 6 7 10 5
0
Landing
Page
Thank
You EM
Thank You, Tell
us how we can
help EM
OBTM
Offer
No open
A
Reason 1
Products
No click
thru
Offer
B
Reminder
EM EM
No open
A B
Financial
Reason 2
No click
thru
“Call us -- we Reminder
can help” & EM
IBTM # EM
Reason 3
related
Service
Test to determine
effectiveness of
benefit Value Value Value
communications EM 1 EM 2 EM 3
Roll into Loyalty if
good response
Reason 4
Other
Benefit Benefit Benefit
EM 1 EM 2 EM 3
19
20. Step 5: Determine Customer
Lifecycle Phases
Activation
Winback On-boarding
Churn
Engagement
Litigation
Communications framework,
data, investment &
measurement strategies need Adoption
Loyalty
to be specific by phase
Renewal Growth
Retention Nurture
20
21. Step 5: Determine Customer
Lifecycle Phases
Create specific strategies for each stage
21
22. Step 5: Customer Lifecycle Phases
Investment Strategy
Based on your likelihood for good lifetime value and churn litigation, you can
determine how much money to put into a campaign
22
23. Step 6: Define Targets
and Messaging
• Know your strategy
– Education, cross-sell, etc.
• Determine available data
– Revenue, tenure, products purchased, etc
• Consider attributes for segmentation
– Profile or model against most profitable customers to
identify opportunities within your base
• Personalize where possible
– Targeted, personalized, relevant messages ensure
customer engagement for lifetime loyalty
23
24. Step 6: Messaging Hierarchy
Customer Segment
Benefits message
Product Features
and Benefits
24
25. Step 7: Plot the Journey
• Define key stages to reach customers
– Before contract expiration
– After 3 months of no purchase activity
– On purchase or activation anniversary date
• Determine which targets are highest value to
your organization to set frequency accordingly
• Test different formats and channels to get the
most bang for your buck
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30. Step 8: Set Test and
Implementation Plan
• Evaluate audiences that are most critical to impacting
goals
– Identify groups of customers that will move the needle on
your business most if more engaged
– Identify best media mix to reach your audience
• Set revenue goals to make sure costs are offset and
positive ROI is achieved
• Schedule implementation with enough time to read
results accurately and rollout next steps
• An implementation plan will help ensure that no steps are
overlooked and that each team member is clear on their
role
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32. Step 9: Create a Brand
• Consider a “voice” for your communications so that
all touches are consistent
• Make sure look and feel of touches are clearly
from the same family of communications
– Informational, promotional, whatever the objective
• Carry the branding throughout the customer’s
lifecycle even if touches are internally managed
in different groups
– All touches should clearly be coming from one company
32
34. Step 10: Go to Market and Refine
Build the
communications map
Refine strategies to Define the target to test
test again against control
Measure results
against objectives
34
36. Case Study: DIRECTV
Building a New Customer On-Boarding Strategy
• The Business Problem
– In 2008, DIRECTV found that the number of new customers that were
churning off the platform within their first 90 days was on the rise and
communication weren’t consistent across the various internal groups
• The Solution
– Launched project to create an on-boarding strategy
– Executed the 10 key steps above beginning with setting
quantifiable objectives to:
• Reduce churn and improve engagement
• Increase customer satisfaction numbers
• Improve installation experience
– Created an integrated multi-channel plan to reach
customers via installers, email, direct mail, and phone
during their first 30 days of service
36
38. Case Study: DIRECTV
Building a New Customer
On-Boarding Strategy
• The Results
• In 2011, conducted a review and found an increase in all key metrics
including reduced churn and improved customer satisfaction
• Next Steps
• Now building the 2.0 version to evolve to a hyper-customized
approach based on psychographic and lifestyle information to
increase relevance
– Asking key questions at registration to target messages
– Respecting how customers want to be contacted
– Creating a community online through a Welcome Center
– Integrating the website into the experience rather than just sending
customers there
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39. Case Study: Clearwire
Developing a Customer
Communications Program
• Started with zero customers and had to develop
a plan
• Closely aligned to 10 step process to develop a
CRM program
• Set priorities and timeline
• Internal mapping
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40. StrategyMaster™ Planning Process
• Designed to help marketers make significant improvements to their
communication programs
• Will establish a visual strategic mapping framework to help manage
tactical implementations of marketing activities aligned around specific
strategies that have been determined to achieve the given goal(s)
• The first three steps within our strategic process include:
– Strategic planning
– Visual mapping
– Road mapping and prioritization of implementation plans
• The structure ensures the plan is rooted in activities that are focused on
achieving the goals and objectives established
• Designed to ensure that the plan is adhered to, while being flexible to
adapt to changing market conditions and shifts in strategic priorities
• Participation by key stakeholders and support teams is a critical
component to the success of the planning process
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44. Need for Multi Channel Approach
• Only 20% of customers open one or more emails
with weekly contact strategy
• Although DM 5X cost of EM – the CPS were the
same opening up available universe and increasing
the total number of reactivations
DM had X times higher response rate
DM had X times higher take rate
44
