With Chinese customers increasingly disloyal, the modern Chinese marketer is focused on marketing to address disloyalty; but it is customer retention that is ripe for innovation, and this is where brands should be investing resources.

That’s the view of Elijah Whaley, CMO at influencer marketing platform Parklu, who observes, in a new report on this topic, that China’s digital landscape has increased the cost and complexity of customer acquisition.

And since brands can do little about the increasing costs, with gatekeepers like social/e-commerce platforms and KOLs holding the keys to consumer attention, he argues that they should instead focus on what they can control: customer lifetime values.

That means turning to retention marketing. And loyalty strategies in China, he notes, tend to be more innovative and culturally sensitive than Western cross-border counterparts. (WARC subscribers can read the report in full here).

“Instead of designing triggers to maximise penetration and adoption of loyalty programs, many Chinese brands are using the data they generate to better serve core, high-value customers in order to recruit more of them,” the report states.

So rather than aiming promotions, for example, at general consumer segments, they use these to increase the spending and loyalty of those higher value customers.

And then they can tap the power of KOC marketing, where Whaley advises that the gains to be had are “exponentially higher” than, say, outperforming rivals with superior programmatic ads.

But this also necessitate a co-creational approach to marketing and advertising that puts consumers in control.

And internally, too, a degree of control has to be relinquished as the goal of retaining more customers is a moving target: frequently shifting requirements at the individual customer level make an agile approach most suitable.

“Retention marketing is dynamic and complex, often requiring flexible power structures that give employees the ability to act in the brand’s best interests.”

Sourced from Parklu