I first mentioned ‘Stop Loss: The Power of Attention Messaging’ in ‘ProfitXL to Profipoly: Solving the Four Funnel Frictions.’ In that article, I talked about how a combination of Attention Messaging and VRM can lay the foundation of a profits monopoly (Profipoly). In this series, I will discuss Attention Messaging and how it can help brands create the twin moats of profits and monopoly.
Love and Loss
One of the most important relationships is between a brand and its customers. Brands generally do not notice their customers. However, customers do detect the presence of brands in their lives. This is why there is an element of sadness when that relationship breaks. It is usually the customer that decides to end the relationship. Sadly, the brand rarely notices this despite the obvious signals.
Brands go to great lengths to acquire new customers, using ads, offers, discounts, and messages. For customers, it is like being caught in a whirlwind love affair. However, once the relationship is cemented, brands move on instead of getting to know the customer better, leaving them feeling neglected. The promise of spending a lifetime together is forgotten.
This is where the separation starts, as other brands woo the customer with ads, offers, discounts, and messages. And thus, the cycle of love and loss continues.
Only some brands manage to stop the loss and build an increasing pool of customers. These brands become industry leaders and are the ones who have erected a moat. They have an excellent relationship with every customer, making each feel special. These happy customers recommend the brand to others, creating a growth flywheel. Other brands try to emulate these industry leaders but have limited success.
We have experienced both types of brands and the love-loss that goes with them. While I may have exaggerated some of the emotions, the key point remains: Brands do a lot to start a relationship, but not enough to sustain it over a long period. I find such an approach a mystery. Retaining a customer rather than constantly looking to acquire new ones is much easier and more profitable.
In the world of B2C, customer churn is just a statistic. In the B2B mid-market and enterprise world, there would at least be an inquiry to establish what went wrong.
Such things didn’t matter in the pre-digital and pre-pandemic age, where digital relationships comprised a small percentage of the overall customer base, and most brands also did not know their customers. However, this has changed and will change further in the future. Every relationship can become digital, even for brands that sell through marketplaces and intermediaries. This is because every customer now has a digital identity and footprint.
Brands must get to know the customer, or newer direct-to-customer (D2C) brands will eat into market share and customer value. By ignoring the power of Attention Messaging, brands miss out on a key chapter in their playbook. By spending 10X more on acquiring new customers instead of focusing on retaining and growing existing customers, brands are feeding the profit machines of tech giants such as Google, Facebook, and Amazon.
The failure to build deep relationships leaves their customers open to being acquired by competition. Attention Messaging is the key for brands to create the twin moats of profits and monopoly.
Broken hearts
I came across ‘The Information’ a year ago through a link from Techmeme. The Information was a subscription site with stories from the world of tech. I subscribed for the free trial but did not pay the annual fee to continue the subscription. The relationship was over for a time. However, The Information reactivated the relationship by sending daily updates on the Creator Economy. As I read those, it made an interesting offer, asking me if I would like to subscribe for the first year at a 50% discount.
I agreed and thus began a new relationship. They probably don’t know anything about me, save for an email ID. I hope they do get to know me because the cost of losing me after a year would be almost $400 a year.
All that The Information needed to do to maintain the relationship was send a few well-crafted emails through the interim when I had yet to activate a paid subscription, which would have cost them less than a few cents. This is true for all brands, yet only a few do it. Most brands don’t even realize when customers move on.
My son switched from Samsung to Apple, yet Samsung doesn’t even know. They never got to know him when he purchased the phone, and they don’t know that he has moved on. Why would they not work harder to foster relationships with the people they are creating products for? Yes, they have millions of customers, but not even trying to create a digital relationship cannot be the standard operating procedure.
Let’s talk about Vodafone. Vodafone has not noticed that I, a heavy data user, have barely used their data services. If they check their records, they will find I have been a loyal customer for over 20 years and have postpaid for their highest data slab. Today, it has been two years since I have consumed hardly any data. However, no calls, messages, or emails have been received to inquire. After switching data to a second SIM, will it be long before I port my number as well?
Two and a half years ago, we moved on from our Honda Accord, and Honda probably doesn’t even know it yet. They never really got to know us, with their service center having only my wife’s mobile number. They didn’t know me or my son – all of us who had a say in deciding our next car. This is despite our association with Honda for so many years. Did they get to know us as a family? No, yet all they had to do was ask.
They could have built a beautiful relationship, telling us about their cars. Had they asked, we would have told them how the car was a big part of our lives, how we loved the leg space in the rear seats, and how much we wanted to get a new Accord. We had even visited their tech center in Tokyo. They could have persuaded us to stay if they had invested in the relationship.
The fields of broken relationships are getting fuller by the day. However, they don’t have to. The choice lies with the brands and marketers. However, most are voting for the new rather than the ones already with them. They are in a game they cannot win, as profits are handed to tech giants in search of more rather than as rewards to the ones who can give them more.
Continued in Part 2
