Behind every sale is a customer, and every customer is either new or existing. Growth comes in these two flavors: gain more customers, or increase the value of the customers you have. The maxim is simple, but it masks something important. The real growth drivers live in four elements that shape this dynamic: insights, motivations, incentives, and scale.
I’ve spent a good chunk of my career on customer acquisition, but I may be slightly more enamored with loyalty growth. Loyalty means customers, and with customers come data and insight. For a marketer, those are tools, and loyalty simply gives you more to work with. There is, however, a place where loyalty and customer acquisition come together. To me, that is hallowed ground for growth.
There’s a saying I’ve always loved: when others speak for you, it’s always more powerful than speaking for yourself. At Redbubble, I saw an opportunity to put that into practice. Redbubble in an e-commerce marketplace, it looks like line an Etsy, Ebay or Amazon, but it’s a little different. Redbubble’s sellers are independent creators. They make the designs and set the pricing, while Redbubble hosts the e-commerce experience and prints t-shirts, stickers, and more on-demand. With the notion or unleashing these seller creator voices at the forefront, I developed a program that turned those creators into advocates, with incentives to promote any product on the marketplace, not just their own. It was part influencer marketing, part affiliate, all growth.
We socialized the program, secured funding, planned the consumer launch, and recruited and trained our first batch of creators. There was a buzz and excitement surrounding the program. I had an outstanding Marketing Director who was believed and was a perfect fit for the initiative. And then poof, my time at Redbubble came to an end. It’s the one that got away. Maybe it was a big success, maybe it was scuttled to cut costs. I’ve had the chance to ask, but I never have. Maybe I don’t really want to know.
So why bring it up? Because this program had all four elements. We had thousands of creators, nearly a billion products across multiple categories, and a deep set of creator incentives to get them started and keep them promoting. Our forecast and metrics (CAC, LTV, contribution margin) looked outstanding. It had all the makings of an enduring program that used loyalty to bring in new customers.
Insights. The insights that turn loyalty into customer growth usually live at the intersection of your brand, product, and customer. Understand how customers view your brand and product, the role you play in their lives, and why they engage. That gives you clues, and often a deeper set of questions that lead to insight you can use.
Motivations. What drives your customers? Money is usually one motivator, but rarely the most powerful. Some want access. Some want to be seen as experts. Some simply love your brand and want to be included. Most brands have an opportunity to tap into these motivations.
Incentives. People do things for a reason. Getting someone to act once is relatively easy. Keeping them engaged over time is much harder, which is why so many companies succeed at acquisition but struggle with repeat purchase and lifetime value. The right incentives get people involved and keep them involved. If you understand your customers’ motivations, you should already have a couple of good options that pay them off. That’s the key to landing incentives.
Scale. Validate the potential up front: the sheer numbers, and the efficiency needed to reach maturity. Even a rough forecast and so-so metrics beat none at all. Quantify participants, program cost, and unit economics, all on a timeline. None of these are static, so track and improve them over the life of the program.
Most companies run loyalty and acquisition as separate efforts, with separate teams and separate budgets. Some of the biggest opportunities sit where the two overlap: your best customers bringing in your next ones.