3 ways retailers can build customer loyalty through a frictionless and flexible approach

Consumers’ choices and expectations are changing due to shifts in their shopping behaviors. Since the COVID-19 outbreak, a McKinsey report found that three out of four consumers changed stores and brands. They spent less money on discretionary items like clothing and more on “essentials” like home furnishings. The same report also noted that half of consumers plan to continue their new habits, such as restaurant curbside pickup.

Keeping this in mind, consider rewarding consumers for their new shopping behaviors and preferences by trying these three approaches to customer loyalty.

1. Maximize engagement with a data-driven, cross-channel strategy

Recognize and reward customers through multichannel marketing using tools and processes to analyze customers and their behaviors. For example, collect customer data across all touchpoints and channels by adopting a loyalty program like Oracle CrowdTwist Loyalty and Engagement. These programs reward customers when they buy from a brand in store and online and complete engagement activities, such as surveys.

Also, enhance the mobile experience. The use of mobile devices grew during the height of the global health pandemic in 2020, which presented retailers with a huge opportunity. A June 2020 Ericsson Mobility Report noted that the time people spent connected to mobile broadband went up an average of an hour per day based on a survey of smartphone users from 11 different countries. When you make your customer loyalty program accessible via mobile, you can reach customers on a device they’re already using, which makes it easier and more convenient for them to participate and engage with your brand. Take a look at what Vitamix did.

2. Highly personalize experiences to boost customer loyalty

BCG and Google recently conducted a customer survey in which respondents shared that they were 110% more likely to add additional items to their baskets and 40% more likely to spend more than they planned if they had a highly personalized shopping experience. When asked to rate a particular retailer, customers ranked companies 20% higher when the level of personalization was high vs. low. Popular brands like cosmetic company tarte realized the value of this when analyzing their loyalty program data: repeat clients made up a fifth of their customer base and about half of their revenue.

Brands that map out the customer journey can create highly personalized customer experiences. This initial step may help you figure out key touchpoints for your customers as well as identify how you can customize each interaction to minimize friction and add value. Focus on a new customer’s journey so you can shape your brand’s messaging and offer strategies early to build long-term loyalty. Analyze shifts you notice with ongoing customers so you can try a new, creative approach.

Consider mapping out how you can apply the loyalty program data you collected to every customer interaction to create highly personalized customer experiences. Fill the gap left by traditional in-person experiences during this time of social distancing and innovate ways to connect with shoppers and recreate in-store experiences. For instance, augmented reality can give consumers the chance to interact with products they are assessing, and online chat can help fill the void of in-person interactions.

3. Map the customer experience throughout the journey

Identify the pain points you’ll need to solve throughout the customer journey by determining what customers think and feel—in addition to what they are doing at each step. According to Wharton Baker Retailing Center and WisePlum, customers who experienced problems while shopping were 35% less loyal than those who conducted business problem-free. Leading retailers aim to solve pain points by providing convenience and an incentive to spend more and purchase more frequently. For this reason, consider offering contactless return policies and extending support channels across phone, email, and social media.

In addition, subscription-based models can give customers the opportunity to obtain greater value and convenience from a brand through exclusive benefits like free shipping. These are perks that you can either offer for free or at a premium to loyalty members in exchange for signing up and spending with the brand. Both loyalty programs and subscription-based models provide retailers the opportunity to collect insights over time to help inform their acquisition and retention strategies.

Building customer loyalty involves thoughtful and positive customer interactions at each touchpoint throughout their purchasing journey. When you design and implement activities that build customer loyalty, incorporate data, strategy, and optimization, you will likely see a return on your investment.

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