Years ago, businesses thought ahead to organize their brand around the customer. But what does that look like? If you can’t measure it, it’s hard to justify it – or do it.
Today, the reality is that most businesses have the customer at the center of everything they do. But measuring it can still be tricky. These questions can put you on the path to better measurement:
A great real-world example of this is Nordstrom. Back in 2016, they began to re-evaluate their measurements for success, with the goal of driving stronger outcomes for the company. Their data showed that the marketing expense was outpacing sales, and at the same time, their rate of customer acquisition was declining – which were negative outcomes for their business. To combat that, they first looked internally and focused their decision-making around the customer.
When marketing is siloed by channel (search, email, social, etc.) or by brand portfolios (ex. Nordstrom vs. Nordstrom Rack), it can make it difficult to get a holistic view of the customer journey. Nordstrom restructured their internal teams, so they were organized around customer portfolios instead – a customer acquisition team and a customer retention team – instead of individual channel teams. Acquisition is about profitably investing for the future. Retention is all about growing the lifetime value of current customers.
The example we used, Nordstrom, now has a curated point of view on what’s next and how they can reach a new generation of consumers. Since they made this change, expenses are in line with sales, efficiency has improved, and their rate of acquisition has increased.
With a growing audience of current and potential customers, it’s important to know what really drives customer lifetime value. Maybe it’s introducing the customer to a new product or category that you offer or enrolling in your loyalty club. Being able to assess the value of each of these potential actions will help drive your campaigns to meet your goals.
Marketing today is too complex to rely on one single solution. The path to a better strategy involves multiple solutions and customer signals, giving you a comprehensive view of the customer. We can help put together a plan to fit your goals – contact us today!