Loyal customers are a brand’s greatest asset. Typically, around 80% of a brand’s revenue comes from just 20% of the customer base.
A 5% improvement in retention can yield up to a 95% increase in profit.
A strategic focus on optimizing the journey of the customer delivers immense benefits for both brand and consumer.
Habitual, loyal customers deliver higher average transaction value (ATV), increased visit/purchase frequency and margin optimization.
So, what are the 5 key elements required to grow and retain customers and drive engagement and brand loyalty in a world where consumers have more choice than ever before?
Data is the key to creating effective marketing campaigns that resonate with your unique customer base. In order to truly understand what your customers want and need from your brand, a seamless data flow is essential.
Ensuring your brand is not only capturing as much data as possible throughout the customer journey but also has the systems in place to interpret and act on this data to drive better business outcomes is the backbone of a successful customer loyalty solution.
Rich customer profile
Building a rich customer profile for each consumer who has interacted with your brand is key to understanding what will drive them to continue to engage and purchase. Gathering identity data via an enrolment form is the start, but it does not end there.
Pinpointing their unique habits and preferences and utilizing this data to build campaigns ensures much greater success than generating mass offers.
Are they vegetarian, a spice lover or have a sweet tooth and only shop for desserts? Do they prefer salads and wraps over burgers? Or shop exclusively for their kids?
Simply knowing their name, address, gender, and age is not enough to form the basis of a personalized shopping experience that meets their expectations.
And customers are increasingly demanding that the data they provide to brands is utilized in a way that’s beneficial to them.
- 72% of customers say they only interact with personalized engagements.
- 71% of consumers feel frustrated when their shopping experience is impersonal (source).
In order to grow and retain customers, you need to provide a shopping experience that they feel was designed just for them.
Timely and relevant content
It’s not enough to simply send ‘relevant’ content based on customers unique preferences, ‘timeliness’ is also a critical factor in building marketing campaigns across the entire customer journey.
Timeliness refers not only to contextual events such as the time of day and customer location.
For example, aligning offers to different day parts so a consumer receives a breakfast offer – at breakfast time. Or, triggering a push message for a new flavor of ice cream on a hot sunny day when the customer is nearby.
It’s equally important to consider timeliness in the context of a customer’s unique stage in their journey with your brand.
Plexure’s intelligent platform applies AI and ML to automate best practice cadences to pinpoint when a consumer is ready to convert, automating the complex process of creating data-driven marketing campaigns.
What is Brand Loyalty?
Brand loyalty is the tendency of consumers to repeatedly purchase the same brand or product. This loyalty can be due to a number of factors, including the quality of the product, the excellent customer service provided by the company, or simply because the consumer has been using that brand for a long time and is comfortable with it.
To grow and retain customers, increase satisfaction and maximize the value that each and every known customer represents, you need a mechanism to incentivize and reward desirable behaviors.
That’s where a loyalty program – stamps or earn and burn rewards – is critical providing an added mechanism or ‘lever’ in the toolkit that can be utilized in different ways to meet overall goals and KPI’s.
There’s the standard loyalty offers of rewarding habitual behavior, ie, buy 4 get one free or providing points for purchasing particular products.
Loyalty programs can also be used more strategically to transform customer behavior, ie. incentivizing fulfillment methods such as drive-through vs instore ordering, or encouraging orders placed directly vs via a third-party delivery aggregator.
Another benefit of including a loyalty program is that it provides an additional identification point, requiring a customer to scan to redeem, which then provides more transactional data to fuel the data flywheel.
Optimized Customer Journey
With all the other steps in place, the last element required to maximize the value that each and every customer represents is an optimized customer journey.
Each customer is at a unique stage in their relationship with a brand and that should be reflected in the messaging they receive.
They may have just made their first purchase, so a robust onboarding process is required to ensure they are ‘activated’ effectively, via a data-optimized sequence of messages. Or at the other end of the spectrum, they may have lapsed and require an added incentive to make another purchase.
Even the most digitally savvy brands tend to narrowly focus their engagement strategies, often missing optimizations across the full customer lifecycle to ensure they spend their budget and resources in areas that truly shift the dial.
Plexure works with some of the world’s largest QSR and grocery brands to optimize the opportunity that each and every customer represents. Our clients have achieved some impressive results, including a 50% reduction in time to first purchase, through to a 65% increase in user retention.*
To find out how Plexure can help your brand truly capitalize on the value that loyalty can deliver book your demo today.
- Loyal customers are a brand’s greatest asset, and around 80% of revenue typically comes from just 20% of the customer base.
- A 5% improvement in retention can yield up to a 95% increase in profit.
- Data is key to creating effective marketing campaigns that resonate with customers and understanding what they want and need from your brand.
- Building a rich customer profile for each consumer who has interacted with your brand is key to understanding what will drive them to continue to engage and purchase.
- It’s not enough to simply send ‘relevant’ content based on customers' unique preferences - ‘timeliness’ is also critical in building marketing campaigns across the entire customer journey.
- To grow and retain customers, you need a mechanism to incentivize and reward desirable behaviors – this is where loyalty programs come into play.
- The last element required for maximizing the value of each customer represented is an optimized journey – taking into account where they are at in their relationship with your brand.