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Building Customer Loyalty

How brands can leverage their customer database and other owned marketing assets to deliver better customer experiences, leading to higher customer loyalty.

Building Customer Loyalty

It all starts with understanding who your customers are, what they want and need, and what makes them tick. Customer Relationship Marketing, or CRM for short, is an important part of gaining a deeper understanding of one’s customers or shoppers and the various data around a customer’s interaction with your brand. If you don’t have a customer database starting with names, emails, addresses and basic preferences, now’s the time to start. It’s the cornerstone for building customer loyalty.

However, having a database doesn’t equate to building customer loyalty. It’s how you use the data to create better customer experiences, online or in your stores and in all possible marketing communications. Let’s start with a basic question: What makes a customer loyal? There’s a lot of research to support this customer-centric thinking. It often boils down to getting the basics right of having a good product at a good value. And for many brands, that’s hard to achieve by itself.

Next come the intangible factors for building customer loyalty, such as emotional affection for the brand or the fact that customers want convenience. That’s a key reason why retailers need to fix their check-out processes. Customer might have a great feeling about the brand and a delightful shopping experience. But then an awful check-out experience with long lines and not enough open registers/lanes completely drain the euphoria shopper had prior. Nailing the check-out experience is a fantastic way to build customer loyalty. Those are elements that have not much to do with marketing or knowing each individual’s preference, but rather thinking holistically about human needs and common desires among most/all customers. Next comes the individual’s preferences.

Next come the intangible factors for building customer loyalty, such as emotional affection for the brand or the fact that customers want convenience. That’s a key reason why retailers need to fix their check-out processes. Customer might have a great feeling about the brand and a delightful shopping experience. But then an awful check-out experience with long lines and not enough open registers/lanes completely drain the euphoria shopper had prior. Nailing the check-out experience is a fantastic way to build customer loyalty. Those are elements that have not much to do with marketing or knowing each individual’s preference, but rather thinking holistically about human needs and common desires among most/all customers. Next comes the individual’s preferences.

Personalization & CRM to Enhance the Customer Experience

Most customers value time and money. If you can help them save both, that’s a great start to building customer loyalty. Furthermore, customers tend to be loyalty to brands that “get them,” or understand their individual preferences. That’s why hospitality companies like hotels and airlines, want to know what types of seats or rooms you like, meal preferences, drink preferences etc. However, having that data is worthless if you can’t use it to build customer loyalty. A simple use-case of hotels welcoming you when you check in and telling you that they have a great corner room on a high floor or a quiet room away from the elevator are little things that use what they know about your preferences to delight you. How great would it be if we didn’t need to remind them every time we check in? That’s what personalizing the customer experience looks like in a very small way. Now how can brands and retailers to do the same?

Retailers have lots of information about what you buy and perhaps some info on your preferences (who doesn’t like a shorter line at checkout?). Most aren’t using their data to deliver personal experiences like the hotels and airlines. It’s not that hard. As a potential solution, retailers in certain categories have invested in personal shoppers to deliver this level of personalized service and experience. Nordstrom’s does a fantastic job at this. While this model doesn’t work for many retailers, there are plenty of other ways to deliver more personalized experiences. Kroger, as a grocery retailer, for example, delivers personalized coupon mailers to shopper with targeted offers based on what the customer buys or might be inclined to buy. Does anybody like getting random or completely irrelevant offers from a retailer for things they would never buy? I doubt it. That’s a great way for brands and retailers to destroy customer loyalty. Despite good intentions to offers money-saving deals to shoppers, lack of relevance can turn off shoppers versus building customer loyalty brands so desperately need.

Building Customer Loyalty without Needing A Loyalty Program

Brands often thinking that the best way to build customer loyalty is to create and launch a loyalty program for customers. Customers can sign up and get rewards, such as points, for shopping. Loyalty programs are big business, but unnecessary. There are so many ways to build loyalty without the gimmicks. If marketers focused on understanding what customers buy, what they won’t buy, and how they want to be reached (communication preferences like email, SMS, Facebook, etc.), marketers can expose customers to special offers and merchandise at the right time for that customer. This is the big area marketers need to focus on getting right for building customer loyalty. Blasting coupons out to millions of people at a time is a far cry from what most customers want. You can reward loyal shoppers with coupons and offers and delight them by helping them save money when they don’t expect it. You don’t need to create loyalty programs that confuse shoppers and make them jump through hoops.

Conclusion

If you are not using CRM and customer-centric thinking to build customer loyalty, then you are missing the big opportunity. Identifying the real issues and barrier to building customer loyalty and deploying the right solutions will separate the best brands from the rest.

Interested in more effective ways for building customer loyalty?

If you are interested in discussing how your CRM program and customer loyalty strategies can benefit from a more strategic use of data to personalize the customer experience, please contact us today. Our teams partner with forward-thinking marketers like you to bring strategic thinking and digital innovation to clients that empower meaningful growth.

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