Marketing Automation: A Consumer Perspective

Johan Uttenthal Milling & Martin Morell Jensen

Student thesis: Master thesis

Abstract

With this paper, we seek to investigate how companies can apply Marketing Automation software to achieve customer loyalty. By conducting a twofold approach to analysis, we first establish a conceptual understanding of both loyalty and Marketing Automation. Secondly, we apply a consumer perspective on both fields to understand how consumers perceive companies’ increasing ability to implement personalized communication. By combining theoretical and empirical insights on loyalty and Marketing Automation, we found that six categories apply for companies when doing Marketing Automation with the purpose of achieving loyal customers. The categories were further interlinked into three groups that companies must integrate in their automated marketing communications: 1) Relevance & Personalization 2) Dialogue & Interaction 3) Data & Privacy. Additionally, relationship emerged as an overarching concept. The degree to which consumers experience an emotional or relational attachment to the company holds a profound impact on the ability to achieve customer loyalty. Hence, relationship itself is the one key factor to unlock consumers’ willingness to interact with companies. An interaction leading to a mutually beneficial dialogue that leads to a consumer perception of added-value. Consequently, companies’ ability to provide longtermed value helps establishing an actual relationship, that should lead to further acceptance of more comprehensive data usage as well as increased personalization, and thereby lead to higher perceived relevancy. Subsequently, with a relationship in place, companies can similarly avoid privacy issues. With this hypothesis in mind, we move on to the second part of the analysis. Here, we investigated how marketing messages compiled from Marketing Automation was perceived by consumers. Our analysis was concentrated on specific communicative channels throughout the Customer Journey: banner ads, email, In-Store Experience, and SMS. Conducting the analysis, we found that transparency is a crucial concept in line with relationship. When companies use Marketing Automation, they must inform consumers about data collection and how it adds value to the customers via an enriched Customer Experience, and for which purpose the data will be used. We found that if companies seek to leverage data collection, the company must provide the consumer with a full sovereignty to opt-in/out when aiming for customer loyalty. Specifically, to develop customer loyalty we found that banner ads should mainly function as a mean for identification. By providing rich content inspired by the principles behind Content Marketing, banner ads can be used to present value-adding content in main product categories, enhancing the dialogue leading to further interaction. When using e-mails for dialogue, companies must communicate relevant based on the consumer’s ongoing feedback (preferences, purchase history, level of engagement). By communicating in relation to the consumer’s exact needs, companies eliminate undue dialogue and demonstrate loyalty to consumers through insight and value-adding services. In addition, inaccurate product offers were found to harm customer loyalty. When integrating online and offline channels, we found that companies cannot apply online data in an offline context without further consideration. To enhance Customer Experience, a separate relationship must be established offline as well. When the two distinct relationships exist, online data can gradually be applied in the offline context to ensure relevance and improved Customer Experience. Finally, we found that SMS should only be applied after a relationship is established and is only to be used as an add-on service tied to the purchase. Otherwise, SMS will be perceived as intrusive. However, when a relationship is established, SMS was found to be a powerful channel to enhance Customer Experience and develop customer loyalty. In conclusion, we found that Marketing Automation can be used to build, develop and maintain customer loyalty by complying with the transparency concept, through informing customers of value and receive their consent. Correspondingly, companies should focus their Marketing Automation on building mutual beneficial relationships throughout the Customer Journey.

EducationsMSc in Organisational Communication, (Graduate Programme) Final Thesis
LanguageDanish
Publication date2018
Number of pages180