This is a continuation of ‘eFolly To Profipoly: The Art and Science of eCommerce Profits, originally mentioned in ‘Mystery of the Missing Profits.’ In the first part of this series, I talked about the profits problem and how most eCommerce companies are struggling with slim profit margins. I also discussed how brands could address this problem through a change in mindset and start their journey towards profitability.
In this part, I will talk about the building blocks for the transformation from eFolly to Profipoly and explain the frictions encountered during the customer journey.
Innovations
Here are the new building blocks for the journey from eFolly to Profipoly.
Email 2.0 as the Fulcrum
Email 2.0 has emerged as a central axis for customer engagement, leveraging AMP to transform static email content into a dynamic and interactive platform. This allows customers to perform transactions and browse content directly within the email. Microns, or micro newsletters, deliver personalized content to users, making email engagement quick and convenient.
Martech 2.0
Martech 2.0 represents a shift from siloed, point-solutions to a unified, integrated solution. The Unistack concept consolidates diverse marketing tools into a streamlined platform. Unichannel (beyond Omnichannel) ensures a seamless, consistent, and unified user interface across touchpoints, eliminating barriers between online and offline channels.
Large Customer Model and Digital Twin
The Large Customer Model involves the creation of a detailed, large-scale model of customer behavior and preferences. On the other hand, the Digital Twin concept involves the creation of a comprehensive digital representation of each customer. This allows highly personalized marketing tactics. The Digital Twins interact in a Mirror World, helping predict the next best actions and maximizing lifetime value.
Velvet Rope Marketing (VRM)
Velvet Rope Marketing creates exclusive experiences for Best Customers by combining the principles of Customer Lifetime Value (CLV) and Best Customer Genome (BCG). CLV enables a forward-looking view on customers, focusing on their past transactions and projecting their future value based on behavioral, demographic, and psychological data.
On the other hand, BCG creates an intricate, personalized profile of valuable customers, highlighting their preferences, habits, and interaction history.
Atomic Rewards (Loyalty 2.0)
Atomic Rewards redefines traditional loyalty programs by offering customers small, frequent, and highly personalized rewards. It offers pan-brand micro-incentives for non-monetary transactions: attention and data in the upstream and reviews, ratings, and referrals in the downstream.
Progency
Progency combines the robustness of a platform with the adaptability of services, becoming a trusted ally for marketing departments. Progency’s performance-based compensation mirrors Adtech agencies, creating an alignment with brands and fostering a shared objective of success.
Earned Growth
Earned Growth is an innovative metric that assesses progress in the Profipoly journey. It quantifies the revenue from returning customers and their referrals, excluding revenue from paid acquisitions. This focus on organic growth and customer loyalty highlights the importance of customer retention and advocacy in the long-term growth narrative of businesses.
Let’s re-examine the frictions in the customer journey and how these ideas and innovations can fuel the eFolly-to-Profipoly transformation.
ATF, ToFu, MoFu, BoFu, BTF
I have already discussed the five funnel frictions, the good fractions, and the solutions in ProfitXL to Profipoly: Solving the Four Funnel Frictions, Solving eCommerce’s Fifth Funnel Friction: Identifying Unknown Shoppers, and Email 2.0: The Fulcrum for Fixing Five Funnel Frictions.
Towards A Profipoly: Solving the Five Funnel Frictions
Insufficient marketing spends on new customer acquisitions. Waste: Wrong acquisition and Reacquisition | Reacquisition → Reactivation Referrals from Best Customers | |||
Unknown/Anonymous shoppers | Email 2.0, AMP, Atomic Rewards, Gamification, Micro Newsletters | |||
Low opens and CTRs due to information overload and non-personalized messages | Email 2.0, Email Shops (AMP), Engaging Footers, WhatsApp Shops | Special focus on Best | ||
Poor customer experience leading to drop-offs and disengagement on brand-owned properties (website/app) | Large Customer Model and Digital Twins Velvet Rope Marketing, CLV, Best Customer Genome Martech 2.0, Unistack, Unichannel, Search, Browse, Recommendations, Omnichannel Personalization, Earned Growth | Special focus on Best | ||
Existing customers become inactive or are lost, and are then retargeted for expensive reacquisition. | Email (AMP); Data enrichment; Microns Atomic Rewards (Loyalty 2.0) Partner which combines product and agency Adtech-style performance pricing | Left and Test |
The friction and fixes can be better represented in the traditional marketing funnel, ToFu, MoFu, and BoFu (top, middle, and bottom of the funnel). I have added ATF (above the funnel) and BTF (below the funnel).
ATF (Above the Funnel) – Adtech AdWaste to Near-Zero Acquisition Cost
This is the initial engagement phase, where potential customers first encounter a brand. Marketing initiatives can achieve unprecedented efficiency and cost-effectiveness by curtailing AdWaste due to wrong acquisition and reacquisition.
ToFu (Top of Funnel) – Identity Gap to Anon-to-Known
Here, marketers face the challenge of transitioning anonymous site visitors into known contacts. The aim is to incentivize anonymous visitors into sharing their email ID and mobile number, ensuring digital reachability and facilitating their progress to the next funnel stage.
MoFu (Middle of Funnel) – Attention Recession to Inbox Commerce
This phase focuses on retaining customer interest and engagement through Email 2.0 and leveraging tools such as Microns, Email Shops, and Engaging Footers. Search functions, recommendations, cart management, and payments can be accomplished in-channel. This increases the probability of transaction completion. Atomic Rewards can also help gather zero-party data voluntarily provided by customers.
BoFu (Bottom of Funnel) – Red Journeys to Green Journeys
This is the phase for customers who visit a website or app intending to make a purchase. At this stage, it is crucial to minimize drop-offs, optimize conversions, and ensure that their customer journey is seamless and frictionless. Here, Martech 2.0 and the Large Customer Model with Digital Twins are indispensable for predicting the next best actions.
Velvet Rope Marketing, targeted at profitable customers, can maximize their lifetime value through exclusive offers and personal experiences, further boosting profitability.
BTF (Below the Funnel) – Dormancy and Churn to Reactivation Progency
This final stage focuses on retaining customers after their initial purchase. The objective is to re-engage and reactivate customers that have fallen into dormancy. This approach steers marketers away from retargeting and reacquiring customers through expensive Adtech expenditure. Partnering with a Progency acts as an effective way to ensure marketers are focused on nurturing active and transacting Best Customers.
Instead of just considering top line growth or the size of the marketing budget, earned growth must act as the primary performance indicator of a marketer’s success. As earned growth surges, marketers can move past their eFolly and help the brand evolve into a Profipoly.
Continued in Part 3
