Retailers have recognized that even though consumers are loyal to brands and stores, they can be influenced by critical life events.
Event-driven marketing uses transactional data to identify signs of customers, such as when they are buying a house, getting married, or having a child. Then, campaigns are launched to retain customers and upsell them at these critical moments.
We were inspired by the success of these programs and the widely publicized example of a major retailer who inadvertently informed a woman’s husband of her pregnancy. This led us to explore the possibilities of event-driven marketing for business-to-business. Businesses can be pregnant with the opportunity… but only for those who are savvy enough to recognize them.
Trigger Types
Three categories of events your analytics should not miss
- Product triggers can include the expiration of maintenance contracts, product upgrades available, buying signals from transactions (e.g., a company purchasing one product will likely need a similar product), or product replacements at the end of life.
- These are the easiest triggers because they are tied to the lifecycle of the product. This type of trigger tracking requires keeping installed base records of customers over a long period while maintaining the data as current and clean as possible.
- Organic triggers refer to the changes that occur in the business lifecycle. A growing business may signal new requirements for the vendor’s product by means of real estate purchases, revenue growth in new geographic areas, or an overall high rate of growth. Consolidation may be a result of mergers and acquisitions. Vendors can anticipate seasonal sales by understanding the year-end seasonality of their customers and their industry. Changes in executive leadership can also lead to new purchasing strategies.
- Companies assigning a salesperson to a particular account are making this person responsible for identifying organic triggers within the account and positioning products at the correct time to the appropriate person. The advancements in marketing analytics have made it possible to monitor more accounts. This is done by using people, processes, and tools.
- “Black Swans” are uncontrollable events that can have a dramatic impact on a business. Hurricane Sandy boosted demand for hotels, bottled water, and construction materials in the short term. The storm caused an estimated $66 billion worth of damage to property. Due to the ash cloud of the 2011 Icelandic volcanic eruption and the SARS outbreak in 2002-2003, businesses worldwide have re-examined business continuity plans. They also invested in virtual conferencing and telecommuting.
If the marketer pays attention, it is important to change tax incentives and subsidies that can have a very specific impact on new investments.
To respond effectively to these types of triggers, departments must work together. A central marketing analytics team needs to monitor external conditions using accurate and timely data provided by IT or Sales via CRM systems. Marketing campaigns must be creative and flexible, working closely with sales. The operations team must be prepared to meet the demand.
All of this requires cross-functional governance to ensure customer satisfaction and a high rate of return.
Predicting Buying Behavior
It’s never too late to start looking into buying trigger events.
Here are four tips on how to anticipate customer behavior and do it systematically.
1. Your customers are the best source of information.
By analyzing readily available data on customers, you can gain organizational support for larger event-driven marketing campaigns.
Combining data sets, such as your CRM database with your service maintenance records, can provide actionable information on product-driven events. You can find information about organic triggers on the Web for free or via databases (such as customer credit rating data) that marketers do not normally mine.
It is important to achieve a quick victory at a low cost without having to challenge corporate bureaucracy.
The savvy marketing analyst will learn which events correlate most strongly with purchase behavior.
2. Establish real-time reporting to be the first one to identify triggers.
You’ve achieved a quick victory and completed a systematic evaluation of the correlation between triggers, purchases, and sales. It’s now time to create processes that will continually monitor events and flag those worth pursuing.
Prioritize events that will drive the highest revenue while minimizing expenses for data collection and sales and marketing response. Avoid tracking too many triggers simultaneously; starting with just two or three will allow you to make significant progress without overloading your current processes.
3. Timing is everything in event-driven marketing
To achieve long-term success with event-driven campaigns, you will need to be flexible and patient.
A real estate event, such as moving an office or opening a brand new wing in a building, can trigger buying behavior within four weeks. However, mergers and acquisitions may not produce buying behavior until six months after the activity. Black Swan events demand creativity, quick responses, and the willingness to refocus marketing efforts.
It is important to be committed to assessing the market and customer behavior for triggers. Making an effort to estimate the time until purchase up front can increase campaign effectiveness and provide a framework for marketing action.
4. Test your winning rate to increase it
It is important to focus on which triggers produce the best results from the beginning. This will only become more critical as you add new triggers.
When your event-driven activities are mature, you can invest in dedicated staff and additional information sources, as well as tools that allow automation, by demonstrating continual improvement and documenting the business value.