How B2C Marketing Cloud Helps Businesses Improve Retention

How B2C Marketing Cloud Helps Businesses Improve Retention

In the mad rush to acquire customers, online consumer businesses spend frivolously on customer acquisition. Although, once the new customers get acquired the next big challenge is user retention. It is because businesses simply do not have coffers with perennially available cash to burn on acquisition or reacquire churned customers.

Moreover, research done by Adobe attributes 41% of revenue to just 8% of customers, no marks for guessing, the 8% are repeat buyers. Fundamentally, this means that focusing on retaining existing customers is rewarding.
Customer retention revenue contribution

Let’s get basics right –

Retention Rate = # of customers in cohort that your business has in a set period / # of customers in the same cohort within a previous period

If between 6-12 months you had 1000 customers and 150 of them shop again in the last six months, then your [180-Day] n-day Retention Rate is 15%.

Customer Retention is important as to sustain in the competing sphere of online commerce you want the customer to make repeat transactions to recover CAC.

Let’s assume you acquire a customer for $600, and each transaction on average brings you $120. Meaning the sixth transaction is where you recover the CAC and start making profit. That is after the first transaction T1, you want the customer to make T2, T3, T4 and T5 for customers to become profitable for you.

It is also noteworthy to acknowledge the friction between transactions [from T1 to T2; T2 to T3…]. The friction invariably present across the customer lifecycle that is reduced by continuously engaging customers.

And it is the effectiveness of this engagement with customers that Marketing Cloud improves.

In a survey conducted by ClickZ, 12% of respondents (marketers) didn’t know what marketing cloud is. The term is vaguely defined and its definition changes as per service provider. Marketing Cloud as defined by Adobe is different than Salesforce or Oracle, and Wikipedia has a page dedicated to cloud marketing that defines the term broadly. So let’s define the term.

What is Marketing Cloud?

Marketing cloud enables cross-channel marketing across user-lifecycle stages by giving marketers 360 degree view of its users. This comprehensive platform mergers the benefits of Data Management Platform and CRM (both marketing and sales).

Here’s a snapshot from Google Trends substantiating the high level of interest in ‘Marketing Cloud.’ Note that the interest in ‘Marketing Cloud’ is higher than the buzz term of one time ‘Marketing Automation.’
marketing cloud vs marketing automation level of interest - Google trends

The components of Marketing Cloud:

Data management platform
  • DMP , in the context of marketing cloud, stores both first and third party data related to user persona and behaviour. It allow marketers to create micro-segments & analyse user’s action across multiple channels/devices.
Campaign management System
  • campaign management system provides a user-friendly dashboard that allows business/marketing leaders to see vital data and to identify the key outcomes of various marketing efforts.
Campaign Testing and Optimization
  • Optimizing the campaigns with A/B testing, multivariate testing using control groups and setting conversion goals.
Cross-channel marketing automation
  • Orchestrate truly automated cross-channel marketing campaigns to reach the customer using the right channels at opportune times.
Personalization Engine
  • Makes use of user behavior, user profile data to individualize the communication for each user.
Business Intelligence/Reporting
  • Post campaign analysis and reporting that measures ROI, effectiveness, and impact of marketing on business metrics.
Predictive Analytics
  • Uses many techniques from data mining, statistics, modeling, machine learning, and artificial intelligence to analyze current data to make predictions about future.
    • ● Email
      ● Web
      ● Social
    • ● Mobile

The customer retention challenge for marketers

With the available martech tools, marketers start to think about campaigns and only single, isolated campaigns. It happens because marketers use various tools to engage with customers over different channels. There’s a tool to send Text, another for Email, and some other for Push Notifications.

Invariably, by using so many tools, marketers limit themselves into optimizing standalone campaigns and just that.

There’s no birdseye view that lets them envisage campaigns for a customer lifecycle. What’s required is for them to think in terms of customer lifecycle campaigns.

From acquiring a customer to retaining her till D-90 the messaging is different. Thus, the larger aim should be to devise a strategy to cater to different kinds of needs as per the customer lifecycle.

Marketer’s need to shift focus from optimizing standalone campaigns to strategizing campaigns across customer lifecycle.

In today’s multi-device, omnichannel, hyper-connected setup, marketing can not be done in silos, and if approached in such manner, it is bound to be ineffective.

Approaching marketing in silos directly contains your ability to:

  1. Challenge#1 Personalize the communication
  2. Challenge#2 Use data to render targeted communication
  3. Challenge#3 Avoid communication overlap (incoherent communication over different channels)
  4. Challenge#4 Measure the effectiveness of your marketing spend
  5. Challenge#5 Scale marketing as business grows

How Marketing Cloud helps overcome these challenges

Addressing Challenge#1Bespoke communication that retains customers:

Personalization is the backbone of marketing in the digital age. Given the right set of tools, you can make use of data to deliver a one to one, individualized experience to customers. More on personalization in the last section.

Addressing Challenge#2 Better use of Data to run Targeted campaigns:

With data in one place running targeted campaigns becomes effortless as compared to doing it using multiple tools. Marketing Cloud platforms not only ingests data from other sources but also use cross-channel campaign data to operationalize communication further.

User profile data & attributes:

Basic attributes like

first name, last name, gender,

etc.; and any other attribute stored in the user profile.

Read more.

Behavior data & attributes:

Events like

app installed, product viewed, added to cart, purchase done, insurance renewal completed,

etc. and all the attributes passed for these events.

Read more.

Lifecycle (Customer Journey) events:

Events like

signup completed, order completed,

etc. occurring across the customer journey.

3rd Party API Data:

    Integrating and using the data fetched from 3rd party sources like CRM, Data Warehouse, etc.

On-demand service company used data based insights from Marketing Cloud to boost user retention metrics by 10%.

Addressing Challenge#3 Delivering Coherent Communication in a Multichannel setup:

Enter Marketing Cloud, rendering seamless marketing communication is effective with cross-channel campaign orchestration, data management, journey builder, unified reporting, and analysis.

The problem of incoherent communication is addressed by using one tool instead of many standalone marketing tools.

Imagine this common pitfall of marketing in silosa customer receiving the same communication over different channels after already acting on it. In the multi-channel setup, you send the same offer to a customer over different channels. The customer interacts with one of them, acts accordingly to complete the goal but still receives the same communication over other channels. An integrated marketing suite keeps such possibility in check.

Addressing Challenge#4 Increased accountability of marketing spend:

Tracking user behavior across critical touchpoints gives you a holistic view of user behavior and responsiveness to communication throughout the customer lifecycle.

Similar to Google Analytics’ Goals and Conversions, Marketing Cloud provides for tracking of success metrics at the campaign level. It allows marketers to keep tabs on what’s working and what’s not.

conversions and goals

Moreover, less work and more impact translate into increased marketing efficiency. Setting up workflows and automating the communication triggered by user behavior saves a lot of effort and time from manually setting up campaigns.

Addressing Challenge#5 Easily scale marketing vis-a-vis business growth:

Cloud-based systems come with the inherent advantage of easy scalability as per usage requirements. It is no different for Marketing Cloud.

It is noteworthy to mention expectations and benefits marketers seek from integrated marketing suits.
integrated marketing suite and cloud advantages

The possibilities

Having discussed what is Marketing Cloud, its components, how it addresses the challenges consumer businesses face, let’s pick industry examples to illustrate how it helps in customer retention.

Take for instance a content mobile app, app retention rate is a function of repeat purchase of paid subscription in the longer run. In a shorter span, at micro level, it is reflected in repeat site visits or time spent on site or number of pages viewed / session. And, personalization is the key to drive these metrics.

customer retention campaigns

Now take for instance a travel portal [OTA] tussling with the issue of booking abandonment(users abandoning the booking post searching for flights on the site). The magic bullet to combat such an issue is a hyper-personalized email.
hyper personalized email example
Such hyper-personalized email is an outcome of components like Personalization Engine, Campaign Management, Workflow Builder & Event Triggers in Marketing Cloud. Read more about the use-case in this case-study.

In coming posts we shall explore more such use-cases demonstrating the impact Marketing Cloud has on overall user retention. And, if you have any queries or ideas don’t shy away from commenting in the section below.

B2B vs B2C Marketing Automation Platform. What's The Primary Difference?

  • Created: 24 Mar 2017
  • Last Updated: 12 Jan 2022



Shafique GajdharContent Marketer, Webengage

Shafique is a Content Strategist at WebEngage. He keeps abreast of SaaS industry, startup ecosystem and writes about digital marketing, on-site engagement and more. He is a marketing graduate from IMT Nagpur.

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