The Government's newly released National Innovation and Science Agenda shows that for economic growth to continue within Australia, an 'innovation ecosystem' must be fostered, where new businesses with new ideas are encouraged to grow and flourish. With every company wanting to increase, retain or improve their customers’ experiences, this makes marketing vital to fuelling Australia's ideas boom.
Companies continue to focus on acquiring customers and fail to invest in relationship marketing despite the fact that customer retention is more valuable, a new survey claims.
The second annual Cross-Channel Marketing Report, which was published by Econsultancy in association with Responsys, found 22 per cent of companies conduct no relationship marketing at all, and just 30 per cent of companies are “very committed” to the practice.
Nearly two-thirds of respondents have not yet made the move away from a campaign-centric approach, and 44 per cent say their main focus is on acquisition, compared to just 16 per cent focused mainly on retention.
This is despite the fact that 70 of respondents agreed it is cheaper to retain than acquire a customer, and 49 per cent agreed they achieve better ROI by investing in relationship over acquisition marketing. In addition, just 21 per cent thought their companies should focus more on acquisition versus retention. The majority of respondents (56 per cent) said there should be an equal focus on retention and acquisition.
The research was based on a survey of nearly 900 companies and agencies in April and May this year.
“As customer behaviours change and information is consumed from an ever greater number of channels, it will become more important to build relationships at an earlier stage of the customer decision making process,” the report stated.
“Companies switching away from static, campaign-centric models to those that place an emphasis on lifetime customer value are likely to be those that succeed in achieving sustainable and growing revenue streams in the future.”
The most common barriers preventing companies from committing to a better customer relationship cited include a lack of resources, and a lack of a clearly defined strategy. When it comes to customer retention, respondents said email and mobile messaging were the better channels, while paid search was the least relevant.
In a sign that more marketers are getting the importance of relationship marketing, the report did find a larger proportion of companies claim digital channels are “very integrated” with their broader marketing strategy compared to last year. However, still less than half of companies sit in this camp.
Respondents were also asked which channels offered the greatest opportunities over the next year. Social media marketing topped the list with 50 per cent of the vote, followed by email (43 per cent) and website (35 per cent).
As has been seen in the recent IAB Australia report into digital advertising spending, mobile continues to prove the growing channel of investment, and 44 per cent of marketers surveyed by Econsultancy said they are using mobile Web as part of their marketing efforts, up from 35 per cent last year.
“The mass marketing era is over, replaced by personalisation on a large scale, which is powered by data,” Responsys senior director of marketing and alliances EMEA, Simon Robertson, stated in the report.