Evergreen businesses look at long term sustainability.
There are 5 metrics for growth:
Acquisition, Activation (conversion), Retention , Revenue, Referral
As a Growth Marketer – my job is to optimize these funnels to ensure maximum ROI (Return on Investment) and ROE (Return on Effort). I do this via mini experiments carried out with sufficient data points.
So according to Noah, how does a company become Evergreen?
It all comes back to the relationship between the company and the customer. Great companies go above and beyond to nurture their relationship with their customers. This is the kind of company that becomes Evergreen.
Your business can eternally provide life, growth and regeneration. Becoming Evergreen will create a better, richer and more fulfilling experience for your customers. And you’ll gain customers faster.
Leaky Bucket Theory
Most businesses think that new customers are the way to go for growth.
This is quite far from the truth.
Leaky Bucket Theory is an analogy that suggests that most business operate like a leaky bucket. Your business is the bucket and your customers are the water. The holes in the bucket represent the various areas where you lose your customers. Most businesses tend to focus on adding more water instead of repairing the holes.
So what happens when you focus on having more water in a leaky bucket – you get a flood that you cannot control.
Most businesses have no idea of the cost of acquisition of customers or even lifetime value of customers. Having clarity on acquisition costs is vital to know how much you can spend on marketing.
The cost of ongoing customer engagement is nothing compared to the cost of acquiring new customers. If you want to experience dramatic growth within your organization, you must truly understand the relationship between profit, growth, longevity, customer relationships, employee empowerment and customer service.
The term customer-centric is a strategy that aligns a company’s development and delivery of its products with the current and future needs of a select set of customers in order to maximize their long-term financial value to the firm. Customer-centricity is crucial to be Evergreen.
Use data to monitor, measure and track customer consumption and usage and estimate likelihood of future profitability. Then market to ensure they receive the most value from the company.
The Three Cs (increasing conversion):
For an organization to thrive in our rapidly changing economy, it must embrace the Three C’s: character, community and content.
Character is the first thing that comes to customers’ minds when they think about your business. The principle of character is about defining, crafting, and presenting the character traits that you want customers to associate with your organisation. Modern brands that targets the millennials emphasizes a lot on having character – it gives a voice and personality to the brand.
Human beings are prone to seek out others who share similar interests, values and beliefs. People are attracted to brand communities because they help them find others who enjoy the same products or services. Companies that recognize this need for connection and create structures that allow communities to form have significant advantages when it comes to retaining customers, building customer loyalty, and maximizing customer value.
The same is true for repulsion marketing – pushing out people who will most likely not get your brand.
You don’t want to target everyone – if your target is everyone – its most often nobody.
Content is the core “thing” the customer receives in exchange for money. It is necessary for a successful business. Without content, there is no business. However, only having excellent content is no guarantee of success.
If you want to be Evergreen, you need all three Cs to be working together. Examples of this are great social media – with awesome character, helpful and value adding blog posts and landing pages with an attitude.
To create a compelling company character, you must first develop your origin story and communicate it to your customers. Then, define your superhero. People want to do business with people and companies they like and trust, but also who fascinate them. And superheroes fascinate us. The personality of your character must be perpetuated though every piece of marketing and every bit of customer communication. Step three is to build purpose for your character’s actions. Understand your company’s purpose for doing what it does. Then, create an avatar of your character. Imagine that your company’s character and your ideal customer met today for the first time. Create a fictional conversation between them. Good examples of these: Middle Finger Project, Eat 24 etc.
Organisations that successfully build customer communities experience remarkable benefits from their efforts. It will take time and money but it is well worth it. To build a customer community, you must first develop a community strategy. Once you have defined your vision, choose your tools. The Web offers great tools, but look beyond that too. Then, cultivate your community. Put the right tools and systems in place to allow shared interests, values and beliefs to spread from one member of your community to another. Then, take a step back. Let it grow organically. Good examples of these: Xiomi, Android Community etc.
Your company’s content is only one small part of your customer’s overall experience. Content is valuable, but it is important to provide an excellent customer experience too. Customers want more than just your content. They want to have an emotionally engaging experience that makes them feel good. Having a very clear customer avatar to know how your product / service best serves your customer.
The Evergreen Diagnostic features four quadrants that represent different types of companies:
Deciduous companies lose many customers each year and are constantly trying to gain new customers. This describes the “Leaky Bucket” concept described earlier.
Barren companies have no customer relationship and because of that, no longevity. Most traditional companies operate this way – in a very transactional level.
Wilting companies can retain its customers, but they do little to establish customer relationships. Most typical companies operate in this level – with the occasional eDM’s, SMS-es, etc.
Evergreen companies have great relationships with their customers and keep them coming back. With relationship building emails, knowing exactly what customers want, doing customer proper segmentation and sending targeted and specific marketing messages to customers. Also providing as much value where possible.
Your goal should be to look at every customer transaction as an opportunity to create a long-term relationship with a lot of value.
Rethinking Loyalty (focusing on retention)
There are three distinct objectives of your loyalty program:
- To increase customer retention and increase the frequency of purchases and the size of each transaction
- To gain a better understanding of your customers, including actionable insights
- To generate authentic, segmented and individualised communication and messaging
Design your loyalty program so there is a ladder that customers can climb. There should be multiple rungs that your customers can climb. This will keep your customer coming back and increase his or her emotional commitment to your brand.
Customer loyalty is created not just through a single program, but also through consistent marketing and actions. However, a good loyalty program can increase the revenues from your best customers and increase loyalty from your less-profitable customers.
To build an Evergreen Ladder of Loyalty, you’ll need to follow six steps.
Step One: Define your objectives.
Step Two: Determine what you want to learn about your customers.
Step Three: Design your loyalty program.
Step Four: Identify how you will measure success.
Step Five: Construct your program.
Step Six: Constantly surprise your customers with added perks.