Repeat Purchase Strategies

Digital Marketing - Study Notes:

Engaging with customers post-purchase

CRM also has a role to play in driving repeat purchases after people have chosen to buy a product or service from you. So here are a few key examples.

Tesla

Consider Tesla, the car manufacturer. An interesting thing about car advertising is a huge amount of the advertising value actually comes after someone has bought a car. It’s about reinforcing with the buyer that that was the right decision to make, they’ve bought the right car and so hopefully, when they come to replace the car even three, five years down the line that they choose to buy with the same brand again. So that shows you it’s incredibly important in the car industry that customers are followed up with, and that they’re served lots of relevant marketing material to help them validate that they have made the right decision, and spent a very significant amount of money on the right brands for them.

Oreo

The other end of the spectrum in terms of price point is the fast-moving consumer goods (FMCG) sector where re-marketing and marketing to people after purchase are incredibly important for driving engagement with the brand and repeat purchases. And because the price points are very low, it’s incredibly important that brands try and drive as much frequency as possible. It’s actually very interesting book called How Brands Grow by Byron Sharp that speaks about how brands grow. And he advocates that the best way you can drive growth is through increasing penetration of your brand. This means getting more customers buying it. And he says, “There’s couple key ways that you can do this and one of them is through driving mental availability and the other is through physical availability.” And what he means by mental availability is about being top-of-mind when someone is at the point of purchase.

So if you think of a typical grocery store or supermarket, there are literally tens of thousands of products in there, and there are far too many products for a shopper to make a rational decision on each of those products about will I or will I not buy. It will take them years to do a single shop if they thought about every product and thought yes or no to that in a rational way. So what shoppers actually do is do very short subconscious shortcuts about what they’re going to buy based on product packaging, product familiarity, where it’s in the shop, where it’s on the shelf, and all these types of things. And the more that your brand can be top-of-mind with the customer while they are stood in front of that shelf, the better chance you have that they choose your product rather than someone else’s. This will increase the penetration of your brands and the number of people that buy it, and also, as a result, increase the frequency that people buy your brand which in turn grows the overall brand.

Apple Music

The other area where post-purchase marketing and CRM is very important is in the subscription sectors. Take Netflix or Apple Music as an example. People are signed up for a subscription there and if they choose to take new action that subscription will continue to roll on. And so it’s really important that after someone has made that commitment the retailer continues to market to them and continue to show them the full value that that product service has to offer them.

Examples of this would be making recommendations about what products and which types of music, what types of films that the customer might like. It might also be highlighting some of the features of the service that the customer is not currently using. So effectively, just trying to make sure that the person and the customer has as positive an experience as possible to make it as likely as possible that they really value what they’re getting and so that they continue to pay for it.