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Take a look at this post from Mack Collier, which is based on an analysis of multiple brands by EngageSciences. That analysis found this key takeaway: 4.7 percent of a brand’s fan base generates 100 percent of social referrals.
This isn’t necessarily groundbreaking new information: many people in marketing have known for years about the ‘passionate minority,’ or the idea that a small percentage of your fans/shoppers drive everything. Many other people in business discuss this as a 80-20 rule, generally stated that 80 percent of your revenue/sales comes from about 20 percent of who you deal with. (It is also important to remember in networking.)
If you go back to that graphic at the top, here’s what you hit:
- Most companies focus their marketing efforts on new customers.
- In reality, they should probably focus them on retaining and developing their best customers.
As Collier himself writes:
This is exactly why it’s so important to engage with your fans. So many companies view their marketing campaigns as the chief channel for customer acquisitions, when in fact its your fans that are driving new customer referrals.
I think this is a key point of confusion for a lot of people in the marketing space right now. Because “a campaign” sounds like an active thing that (a) you’ll dedicate time to and (b) will generate value, a lot of marketing types want to be working on campaigns. I recently worked with a lady who called everything, from the simplest e-mail to actual campaigns, “a campaign.” It was moderately infuriating.
We spend a lot of time on campaigns in marketing, and crafting the perfect images and logos and ‘power branding’ and talking points.
But why?
1. We already know ‘brand’ is declining and ‘customer relationships’ are increasing, via financial metrics. Here’s some evidence. Maybe we should focus more on reaching the customers who are driving our conversations.
2. Emotions and connection to a purpose around a brand actually drive consumer behavior: Again, these are things we know from research. This is about much more than how a PDF looks or how sweet the logo is. It’s about value, which is ultimately what a consumer is after.
3. Here’s the essential problem: most CMOs don’t really understand what ‘digital’ is. That’s been proven time and time again, and most jobs I’ve had have been that way. People cling to old revenue models until they’ve sucked every penny from them; when a new CMO arrives, typically within 3-4 years, they do the same thing. The game is about telling the rest of the C-Suite how much money you’re tied to. Customer acquisition can fall by the wayside in that dynamic.
But if you really want to think about finding those new customers? Start by thinking about four-point-seven, friend.
