In recent years marketing technology has become an integral tool for companies looking to boost their Customer Lifetime Value (CLV). Companies recognize that creating an individual experience for each customer requires a broad set of different marketing tools, with a new report [download page] from Econsultancy and RedEye showing that 7 in 10 of the companies surveyed are planning to increase their investment in technology that can help improve CLV.
Note: Econsultancy and RedEye surveyed 610 individuals mainly from the UK, with the majority (66%) representing the client-side or working for an in-house team, and the remaining respondents representing agencies. For the purpose of this article, data will be based on company respondents only.
Among the technologies that companies are using to help increase CLV, email marketing platforms are favored by two-thirds (65%), due to email’s success when it comes to personalization and targeted experiences for buyers. In fact, email marketing platforms appear to be the technology of choice for smaller companies (those with annual revenues of up to £50 million), with 71% saying they use this technology to increase CLV, compared to 58% of companies with annual revenues of £50 million or more.
Respondents also report using personalization technology (45%), customer data platforms (33%), marketing automation platforms (29%) and predictive analytics (21%). However, far fewer respondents have embraced machine learning (11%) and artificial intelligence (9%) in their efforts to increase CLV. Even so, three-quarters of respondents in a survey by Acquia say they will make AI and machine learning part of their marketing strategy this year.
So, which technologies are actually helping to create an uplift in CLV?
Despite it being a technology used by only a small percentage of companies, 94% using artificial intelligence say that it has created significant (29%) or some uplift (65%) to CLV.
A study by The CMO Survey found that CMOs were using AI for personalization and predictive analytics in their marketing – and these tools are also impacting CLV. One-third (32%) of the companies surveyed for this recent report are seeing significant uplift from their use of predictive analytics, while another 59% say they have experienced some uplift. Additionally, companies are seeing either significant (25%) or some (68%) uplift in CLV from the use of personalization.
Machine learning is another technology not widely used by companies that has also proven rather effective for its users, with 30% of companies using machine learning seeing a significant uplift in CLV and two-thirds (65%) seeing some uplift. As such, it’s difficult to say for certain whether organizations that are earlier adopters generally get more out of their technology anyway, rather than these new tools being the sole determinant of improvement.
As a possible case in point, while email marketing platforms are used by more companies, fewer appear to be significantly benefiting from it in regards to CLV, with only 17% reporting significant uplift and 66% seeing some uplift.
Indeed, challenges do remain that hold back technology from being a silver bullet to CLV. When asked to pick their top barriers, around 4 in 10 marketers (38%) chose data limitations / no single customer view, as well as poorly integrated marketing technology. Larger organizations were more likely to put the blame on a siloed organizational structure (49%) compared to smaller ones (26%).
To read more, download the report here.
About the Data: A total of 610 respondents were surveyed between February and March 2019. Two-thirds (66%) are client-side or work for an in-house team while the remaining one-third (34%) work for an agency or classify themselves as vendors or consultants. The majority (60%) of the respondents were based in the UK with the remaining respondents covering a range of other regions, including the US.