The Customer Loyalty Framework

President of Giant Goat, Doug Foley, walks through the “The Customer Loyalty Framework” and how to use it to reverse engineer your marketing strategy.

So, why Does Marketing Fail?

Campaigns are run as individual assets instead of thinking of them strategically across the entire customer journey. This is why most marketing fails – because content is created without consideration of a bigger strategy. We are trying to gear purchase type behaviour at the top of the marketing funnel instead of leveraging how platforms work in order to build a funnel that is natural and based instead on how people behave and how the human brain works.

Marketing In It’s Simplest Form

The main goal of marketing is simply to get the attention of a defined audience with the intent to have a conversation.

Most marketing is broken down into 3 categories; paid, owned and earned:

Paid – Traditional marketing; print media, direct mail, newspapers, tv advertising & now digital

Earned – PR (media mentions), social

Owned – Website, email list, contacts

Most marketing relies heavily on paid or earned marketing with the intent to get them over to their owned assets. Which is why it’s so important to be building your own owned assets, that way you will not be relying on paid assets.

3 Stages of The Buying Cycle

The 3 categories of marketing are relative to how most people buy, which is categorized into 3 different stages:

Awareness – Root brain firing – Fight or flight mechanism – Is this going to kill me or not?
Consideration – Limbic brain – emotional brain – Do I like this or not?
Decision – Neocortex – logical brain – Deciding whether or not to purchase

Most paid platforms, especially in digital, are organized in these steps, which is based on actual brain science and based on how people behave when it comes to purchasing. This is why most marketing fails – customer’s are being met with purchase and decision type behaviour in the awareness stage – instead of leveraging how platforms work, and building content to meet the customers needs at each stage of the buying cycle.

First Priority – How Do I Get More Existing Customers To Come Back?

Most traditional business owners will tell you their business was built from loyal customers coming back and customer referrals. Most businesses stop their marketing efforts with the Buying Cycle, and focus all their efforts on building awareness and driving more traffic to their website. This way of thinking neglects the behaviour of existing customers – when really the data that you have from existing customers can support media buying decisions in the top of the funnel.

How can we get our customers to buy more from us
One of the most significant ways of evaluating effectiveness of marketing is the lifetime value of your customers. The more somebody spends with you as an existing customer, the less you have to spend in paid marketing which ultimately drives down customer acquisition costs. This can be done through increasing the value you’re bringing to customers or by introducing new products or services.

The loyal customers will send referrals to other buyers
These buyers tend to know others who are like them and are already in market and considering what products and services are needed, which gives access to potential customers already in the consideration stage.

Once both loyal customers and customer referrals are considered then it’s time to consider what are we doing in terms of creating assets to drive people through our marketing funnel – such as social posts, video content etc.

How do we create content that is going to meet the need at each stage of the buying cycle?

The UPSYD Framework dates back to Eugene Schwartz’s 1966 book Breakthrough Advertising, and is an acronym that allows you to figure out what type of content or messaging to send to an audience at a given point in time. Although the way marketing is delivered has changed, human nature has not. Which is why a marketing approach over fifty-five-years old still works today.

The UPSYD Framework

U – UNAWARE: Unaware of the problem they have – content created here gives you the opportunity to bring awareness to the issue, what they are missing or what they could use.

P – PROBLEM AWARE: They know there is an issue – now you can introduce the concept of why it’s important and provide context to explain why that problem is relevant to them.

S – SOLUTION: They realize the consequence of the pain (the greater the severity the greater they’re willing to pay) you can then introduce a solution (ex. we do x, y, z to remove this issue).

Y – YOUR-SOLUTION AWARE: They now know about you but aren’t sure if your product or service is the right one for them.

D – DECISION OR DEAL: Knowing about you, they are determining whether it is the right solution for them.

This frame work allows you to sequence and create content and meet them where they’re at by determining which platforms to distribute specific content. Having relevant content at the right stages helps it relate to where the customers are at in the buying process.

This framework drives potential customers directly into your paid, owned and earned marketing as they do their research to support their buying decisions. This is the perfect opportunity to focus on creating content on the platforms in which you distribute specific content.

The most important things to look at to measure whether the framework works are:

CPL – Cost Per Lead
How much does it cost to get the attention of a potential customer and have them enter the funnel
(Take total amount you’ve spent on marketing & advertising and divide it by net new leads).

CAC – Customer Aquistion Cost
How many people converted from a lead into a customer and how much did I have to pay for that customer
(Take total amount you’ve spent on marketing & advertising and divide it by net new customers).

LTV – Lifetime Value
How much did that customer spend with me, needs to be 3-5x the CAC
(Take a broad look at your customers in the 3-year range, are we on track, can we continue to scale or do we need to make changes in how we’re buying and positioning our media).

By working close to the transaction, with loyal customers and customer referrals, you can develop a really simple start. Once you start to move up into the advertising space, you have to be a lot more tactful in how you position campaigns and where you’re driving them from. The good news is, ad platforms actually allow you to pull out the data you know about your current customer base, and create something called a customer list and a look-alike:

Customer List & A Look-Alike
Use information such as their income status, relationship status, where they went to school, etc. + thousands of other data points.

A Look-Alike audience helps position you with a head start and puts your content in front of the ‘right’ people. The ad platforms start to pick up more data points as time goes on and the targeting gets more precise and intelligent.

The TACT sequence below helps to simplify this process of how to meet potential customers at different stages of the buying stages with the right content and messaging. It can be used on both a micro and macro scale to validate your campaigns and match how the brain works at different buying stages.

TACT

T– Traffic – Paid and organic ads used to drive traffic to an asset or offer.

A– Action – Take action, watch, listen or subscribe.

C– Commitment – Book a call, give us their email in exchange for something.

T- Transaction – Am I willing to buy?

How Does Content Really Fit In?

Take the time to listen and understand your customers, understand their pain points so you’re able to align the content in the right sequence, to show your expertise and demonstrate how your services are different and more in line with what they need.

So ultimately, most marketing fails because it wasn’t part of a bigger strategy. It all comes down to developing content in a very strategic sequence, because that’s exactly how the brain works, and how humans been buying for hundreds of years. Understanding that the structure of marketing hasn’t changed since we came out with radio back in the 1920’s – it’s just a matter of understanding how to create and distribute content to get the attention of where your audience is and then nurturing them through the sequence until ultimately you’re doing business together.

Watch the video above to see how Giant Goat President Doug Foley ties all of these concepts together to create The Customer Loyalty Framework, and how you can use it to reverse engineer your strategy for buying Facebook Ads, LinkedIn Ads, Google Ads and a number of other platforms.