When analyzing your conversions, there are a number of factors to consider. As seen by the MecLabs Conversion Optimization heuristic, customer anxiety associated with providing information, the incentive to take action, friction - or psychological resistance - during the conversion process, and the clarity of your value proposition all contribute to the probability of your customer following through with the action you want them to take. There is one additional element, however, that should not be taken for granted when calculating probability: a customer’s motivation to buy.
Companies across a number of different industries have looked into optimizing their marketing efforts to reach customers at a time when their motivation levels are at their highest, ultimately increasing the chance of a conversion taking place. When comparing this targeting strategy, known as event-driven marketing (EDM), with traditional methods, businesses have witnessed a sales response rate improvement of 32%.
The Basics of Event-Driven Marketing
EDM is a discipline that occurs when a company’s campaign activities are based upon relevant and identified changes in a customer’s needs and behavior, both from a transactional sense and beyond it. From renewing a subscription that’s about to expire to buying a new home, life events are experienced recurrently by both individuals and businesses. To aid in making better, more informed decisions, marketers have begun tracking changes in customer needs and data. This increase in customer knowledge, understanding and information can be used to not only determine when to target customers, but also to predict future life events.
Since the significance of life events can differ dramatically (having a baby versus beginning an exercise program), events can be classified into several categories including triggers, simple (predicted) events, significant events, and behavioral or lifecycle events.
Triggers are typically minor, day-to-day occurrences. While ineffective for accurately determining customer needs or responsiveness, they can be useful when tracked simultaneously with other triggers or life events. In addition, triggers can be valuable for automating the business process, such as sending a welcome e-mail or SMS when a customer has recently signed up for a trial version of your software. While event-driven marketing extends past the use of automated triggers, these circumstances are a pillar for tracking daily customer actions and can generate 4x more revenue and 18x greater profits when utilized in trigger-based email marketing campaigns.
2. Simple (Predicted) Events
Identified by their predictability, simple events are scheduled occurrences that provide companies with a window for communication. The end of a subscription, a contract, or any other scheduled customer activity falls into this category.
3. Significant Events
Contrary to simple events or triggers, customers are exceedingly responsive to marketing communication during significant events. These events become important indicators for both real and potential change. A new round of company funding, company expansion, mergers and acquisitions, large deposits, as well as the start and stop of a salary are all examples of significant consumer events.
4. Behavioral/Lifecycle Events
Behavioral events delve even deeper into tracking customer behaviors and circumstances. Furthermore, they often occur in sequences or combinations. Redundancy and churn are two examples of behavioral events, which may be indicated through a series of triggers, scheduled events and significant events.
Exemplified through the dramatic increase in product sales by banks which have shifted marketing efforts to target behavioral changes, lifecycle events are indisputably the most valuable when targeted effectively. These events come in the forms of a first job, first apartment, first child, marriage, move, the start of university and many others.
While EDM has proven to be more fruitful when compared against average segmented marketing campaigns, the window of opportunity to successfully communicate marketing messages is much smaller. An event’s significance and the timescale to effectively relay marketing communication have an adverse relationship in event-driven marketing.
For simple events, such as customers who are nearing the end of their contract, companies face little urgency and have between 5-30 days to begin targeting them. Conversely, significant events (such as churn) must be acknowledged almost immediately.
Due to the gradual nature of their occurrence, behavioral and lifecycle events, such as marriage, provides marketers with a wider window of opportunity. Directly after these events, customers do not begin actively searching out new products and services, but become highly receptive to marketing communication and suggestions. After a period of time, consumers begin researching alternatives (known as the zero moment of truth) through an omnichannel experience. It is imperative that at this point you have a significant space in the customer’s mindshare among competitors.
Successfully executing event-driven marketing tactics require great timing, relevant messaging and hard data. This is often a cross-departmental approach which ultimately relies on event-related data being continually recorded and made available to your marketing team. Subsequently, marketing materials with targeted messaging must be available immediately to target customers successfully. For companies who have turned to this marketing discipline, an increase in average net promoter score of 18% has been seen, with 96% of customers deeming their contact with EDM messages as a positive experience (in comparison to the 16% seen traditionally). By taking into account a customer’s motivation to purchase, and marketing your products and services to those needs and behaviors, your company can not only reduce costly traditional marketing expenses, but you wil also be putting yourself in a strong position to drive more conversions.