There is an excellent case study (IPA Effectiveness award) about how O2 changed the game in the UK mobile category by shifting their business focus from acquisition to retention.
At the time all nine UK brands concentrated their marketing budgets and efforts on trying to sign-up more and more customers - through heavy weight media advertising deals, deals, deals...
This was creating customer dissatisfaction, high levels of churn and an erosion of customer loyalty.
O2 decided it was time for change.
They started to put the customer at the centre of everything they did by delivering brand experiences that would delight customers. This included:
- Offering deals to existing customers only
- Rewarding existing customers
- Hiring extra staff to ensure their customer service improved
- Changing their communications to highlight their new commitment to existing customers.
At the time this was a bold step but the results were impressive. New customers increased, churn declined and satisfaction ratings improved. The other key metric - average revenue per customer - also held steady.
Today O2 goes from strength to strength as they continue to find ways to delight customers with better and better brand experiences. I think their recent sponsorship of the O2 dome, and the Blueroom and priority tickets for shows is brilliant.
Other categories could learn from this.
I recommend getting key stakeholders in the brand organisation together to collaborate and find ways to genuinely deliver brand experiences that delight customers. If you get it right – like O2 – customers will become fans, and hopefully advocates.
It is a straightforward formula. More brands should try it.