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There’s a fundamental difference between product-driven and customer-driven marketing strategies. This blog provides insights into the pros and cons of each approach, emphasizing the importance of combining both strategies to create powerful, personalized marketing campaigns that address individual customer needs and preferences, fostering long-term loyalty.
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In marketing, there’s a somewhat clear separation between strategies:
Product and Campaign-Driven or Customer-Driven.
They differentiate in focus; Product-Based (for simplicity we will refer to both product and campaign driven marketing as just product driven) marketing plans marketing communications around new releases, seasons, and collections.
Customer-Based marketing uses customer insights to determine what communications need to be created and whom to target.
Companies may choose to use one method or both depending on their marketing philosophy.
Let’s understand the two strategies’ pros and cons and look at the combinations of them – all while starting with the customer.
Here, the main idea is that if a company has a product they desire to sell or push, the marketer should probably target customers with campaigns promoting such product.
The logic is straightforward. We identify a business need and want to meet it.
But, when not starting with the customer, questions arise. For example, Should a customer who never made a purchase in such a category receive the same communication than those who have? Should churned and top-loyalty tier customers receive the same marketing messages?
Customer-led marketing starts from a customer insight instead of a product or campaign.
It starts by identifying a segment of customers and discovering a valuable insight from it. Only then, determining what product or campaign should be shared with this segment, creating an extremely intimate marketing program.
Let’s say you begin by looking at your New customers, for example, those who purchased for the first time in the past two weeks. Then, you use predictive analytics to identify those least likely to become top spenders with your brand.
Comparing these to your best customers might lead you to an insight on the differences in their preferences and behaviors. You can then leverage that insight for a hyper-powerful marketing campaign that targets the New, Low Probability to Spend customers with the intention of turning them into higher probability ones.
CDP Institute’s David Raab makes the case for embedding a decision engine in your CDP
There is a way to combine the two strategies and get the best of both worlds. So, if you want to put the customer at the center, but still address the product in relation to the customer – we have a few suggestions for you.
First, we should understand who the customer is, by basing it on the following:
Then, to these Customer-Based points, we add the Product-Based touch:
While there are many products out there, each customer is unique and wants to be addressed this way. Hone your marketing to celebrate the uniqueness of each customer and their relationship with your product or brand. When customers feel that every marketing message your brand is sending to them is a personalized one, they will reward you with their loyalty for life.