Consumer insights:
FANFINDERS
Why building pre-purchase
brand loyalty works FanFinders’ CCO Adam Gillett discusses why for brands and retailers in the baby sector, acquiring customers way before the purchase point and at the right life stage means better cost-efficiency and longer-term value.
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he ‘pre-customer acquisition’ space isn’t new, but it has gathered more momentum during the pandemic. That’s because more and more businesses are looking to intercept people prior to them becoming a customer, add them to their database and then own the relationship from beginning to end using the likes of email programmes, discount codes and relevant product information at key buying points. So they can market to them and build up their sales as early in the parenting journey as is relevant to their brand.
Why are they doing this? Well that’s because the reality is every single digital marketing funnel is the same basic shape, with the wider point at the top where customers first hear about you and then the narrowest point at the bottom where they buy from you. And it’s in this funnel that we find an inverse relationship between scale and cost appearing for brands currently using the likes of Facebook and Google for acquisition, which we covered back in the February issue. If a company is going on Facebook and spending £20 per new customer acquired, they’re gauging success by the
end point of the funnel and what the process costs ‘ cost per customer’ or ‘CPA’. Meanwhile, from Facebook’s perspective, it’s what are they charging ‘per 1000 views’, which is the awareness stage right at the top of the funnel. The gist is that as you scale, metrics such as cost per customer and cost per lead get more expensive. Soon, this dropdown spreads into the entire funnel and everything falls out of sync. All of a sudden, you’re relying on lifetime value and repeat purchases to keep you profitable.
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build sign-up pathways that let our partners communicate with parents at the right time to then convert them into loyal customers. The reason this is so important in the baby market is because of the short lifetime value. The first point for connecting with parents to drive sales is around 6-7 months into pregnancy, when they start thinking about pushchairs, car seats, hospital bags and other essential nursery items. Or, if you’re a baby food company
By inserting yourself into life stages correctly and before these purchase points, brands can communicate to build loyalty and goodwill, using helpful communication that isn’t pushing sales and establish brand equity with their future customer base.
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Image Source pexels.com
Pre-purchase loyalty in the baby market We aim to insert brands in the midpoint of the funnel by creating the awareness but only charging based on a mid-funnel conversion metric like ‘cost per lead’ or ‘cost per email address’. We
for example, it’s before children go through weaning at around 4 months. By inserting yourself into life stages correctly and before these purchase points, brands can communicate to build loyalty and goodwill, using helpful communication that isn’t pushing sales and establish brand equity with their future customer base.
