March 11, 2021
7 min read
The FanFinders Guide to Marketing is back. This time we’re covering how for brands 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.
The ‘pre-customer acquisition’ space isn’t new, but it has gathered more momentum during the pandemic.
That’s because more and more brands 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 extensively in our last post.
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.
We aim to insert brands in the mid-point 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 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 for example, it’s before children go through weaning at around 4 months.
By inserting yourself into these life stages correctly and before 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.
Parents make purchasing decisions early.
For nappy/diaper companies, parents want them in their hospital bag. For baby-specific retailers, they want to be talking to them before 22 weeks about what pushchair and car seat they want before their baby arrives.
Communicating as early as possible and getting relevant data is the key.
In the baby market specifically, what you’re looking for as a brand is to connect with people and this targeting is probably more important than in any other sector.
The reason: for most brands, the window is only from that pre-pregnancy stage through to around 2/3 years old.
Any loyalty you build up through the stages where parents need your products can extend through to when they have more choices available.
If you’re interrupting people in those later life stages for the first time, then you’ve already missed out on a certain amount of purchase value.
Short-term thinking, just looking for the instant sale or what you need right ‘now’, will mean not getting past the smaller picture.
Focusing a program around how fast you can get new customers will eventually mean a constant uphill battle against scale and not owning your own customer relationships up until the point of purchase.
Instead, you should begin building brand awareness and loyalty way before a parent is anywhere near needing your product.
Otherwise, you might miss out on a crucial 3 months and because babies grow so fast, that’s up to 25% of the lifetime value of that customer gone.
If you can acquire people into a funnel that is about targeting with specific products, tailored messaging and email campaigns for specific life stages, everything can interconnect and it becomes one big picture.
This is how you influence the first purchase, take control of the cycle and own the entire journey.
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