The low-touch business model is one where there is little human interaction between the buyer and seller from the customer acquisition process to product or service delivery. Under the low-touch business model, there is little to no direct interaction between the buyer and the seller.
Understanding the low-touch business model
Since automation and digital sales are important components of the business model, it is popular with eCommerce platforms where products are offered with a direct checkout option. When there is interaction on an eCommerce site, it commonly occurs via live digital assistants or chatbots. Indeed, most buyers are not motivated to interact with a company unless they have a pressing issue such as a warranty claim or customer complaint, which makes this business model low-touch as opposed to “no-touch”.
The automated nature of the low-touch business model can also be seen in situations that pre-date the internet, such as withdrawing cash from an automatic teller machine (ATM) and filling the car with gas from a self-service pump.
The three stages of the low-touch business model
Every application of the low-touch business model will be different, but most incorporate three general stages.
1 – Customer awareness
Modern low-touch businesses utilize digital and content marketing strategies delivered via the company website, blog, or email address. Some others may use videos, webinars, or any other automated solution that minimizes costs.
Email marketing is considered particularly advantageous because of the way it can be used across multiple customer touchpoints.
Whatever the strategy chosen, the primary focus during this stage is to get ultra-specific on a target audience or buyer persona and focus on adding value to the channels where these individuals spend their time. Ultimately, the automated communication of the low-touch business model is only successful if it is backed by a deep understanding of the ideal prospect.
2 – Customer evaluation and qualifying
For products with low profit margins, a buyer may peruse the item description or consumer reviews before making a direct purchase. Sellers of premium products or those offering software-as-a-service (SaaS) may entice buyers with an automated free trial or access to a freemium version.
In either case, the in-product experience should be maximized to encourage the prospect to purchase after the free period has ended. This means delivering value as quickly as possible to reduce customer churn rate and increase customer retention.
3 – Purchase and after-sales
Consumers now expect the eCommerce business to handle payment, invoicing, and product delivery by default. However, the low-touch business model should also automate the return, repair, exchange, and warranty claim process wherever possible.
The business should also encourage the customer to leave a review since 90% of customers who read online reviews claim that positive reviews influence their buying decisions. This form of social proof can then be used in the first stage to generate awareness.
- Under the low-touch business model, there is little to no direct interaction between the buyer and the seller.
- Automation and digital sales are important components of the low-touch business model, so it is a natural fit for eCommerce platforms where products are offered with a direct checkout option.
- There are three general stages to the low-touch business model: customer awareness, customer evaluation and qualifying, and purchase and after-sales. There is an emphasis on email marketing and its ability to connect with prospects across various touchpoints. It is also important to develop a specific and accurate buyer persona as a foundation for the stages that follow.
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What is a low touch approach?
Under the low-touch business model, there is little to no direct interaction between the buyer and the seller. Therefore, most of the interactions that lead to the business transaction between customer and seller are automated or at least require little effort or competence. Therefore, the product and service might be either highly standardized. Or they might be customized via digital/tech features at scale.
What is low touch customer service?
In low-touch customer service, customer support is mostly automated. Think of the case of a vending machine, which runs mostly on autopilot, as the customer can proceed with ha self-service procedure in picking up the product.