How to Inspire Customer Loyalty with Marketing Personalization

In the age of ubiquitous customer choice and fierce, omnipresent competition — think Amazon — securing customer loyalty is a strategic necessity for retailers. Which is why so many are adopting a personalized approach to marketing. The customer may always be right, but each customer is different. The ability to appeal to customers on an individual basis is crucial for building better relationships with them and earning their loyalty. Here’s how you can use personalization to inspire loyalty.

Promote the products people want–but go beyond best-sellers and discounts

Consistently offering customers the products, content and experiences they want will please them. Pleasing customers helps to inspire loyalty. Everybody knows that. But how do you figure out what they want? This is actually a pretty hard question to answer, especially through digital channels without the benefit of in-store associates or personal shoppers.

A good approximate answer to this question are best-sellers. Best-sellers, by definition, are the most popular items and therefore are most likely to be well-received by the most number of people. However, not everyone will like every best-seller. Sending such people best-selling items may very well erode loyalty rather than strengthen it. You need to figure out what each person wants. You need to personalize.

The products, content and offers that customers have purchased and browsed should give you a good understanding of what is likely to resonate. This information can be found within your transactional, web and email data. A good personalization system can use these data sources to determine which customers will like which products. In this way, you can personalize your outreach around customers’ tastes and earn their loyalty.

On a related note, you won’t have to rely on discounts as much to drive engagement if you know what people are willing to purchase at full price. Weaning customers off of discount-heavy promotions yields more benefits than simply increasing your margins. Discounts can train customers to only act when those discounts are available as well as to perceive your brand as low value. Reducing your dependence on discounts can help to improve your brand’s image in the mind of the customer.

Surprise customers with products they didn’t even know you carried

Surprising customers with products they didn’t expect but which they find appealing gives them a compelling reason to keep interacting with your brand: what other awesome products will they encounter? Still, it’s pretty hard to determine which products people will like before they’ve actually purchased them.

This is where machine learning software and data come in. Without getting too much into the weeds, hidden within your transaction, web and email data are the trends and behavior that indicate interest for various products, even though customers have not yet purchased those products. A good personalization solution will be able to interpret your data and identify such products. You can then use this insight to inform your outreach on multiple channels.

Find out who loves your proprietary products

Proprietary products are very effective for securing loyalty simply because your competitors don’t offer them. The customers that like these products are likely to be naturally loyal to your brand. Again, the trick is in figuring out who likes what. A good personalization solution will enable you to identify fans of your proprietary products.

What kind of personalization system do you need?

You need a personalization system that can orient outreach around long term objectives rather than just near term engagement and conversions. More specifically, you will need a solution that can introduce customers to products that are new to them–that is, those products that delight and surprise and/or are proprietary.

While “you may also like” and “people who liked this also liked that” product recommendations may be sufficient for increasing near term engagement and conversions, these methods tend to suggest products within the same category or those items which customers have seen and not acted upon. In other words, they often don’t surprise or delight customers. Think of how many times you’ve browsed Amazon or a similar e-commerce site and received product recommendations very similar to the product you were just browsing for a real world example of this phenomenon.

At Coherent Path, we map out each individual customer journey in order to determine 1) where they’re going and 2) discern how best to move them in a direction you would like to see them go: loyalty, higher lifetime value, more cross-sells and so on.

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