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Turn personalized customer experiences into customer loyalty

By Shannon Abel

When the pandemic forced brands and retailers to close physical stores, customers turned to digital channels to fulfill their shopping needs. Pressured by increased competition and heightened consumer expectations, brands had to rethink their digital strategies and redefine one-on-one, personalized customer experiences in an online environment.

It’s critical to personally connect with each customer or risk losing them to a competitor. 48% of consumers have left a brand’s site and purchased from a competitor because of a poorly personalized experience. With advances in technology, companies are finding it easier than ever to invest in digital personalization efforts and quickly realize the benefits. According to Forbes, 70% of executives said that personalization was critical or somewhat important for loyalty, customer retention, and share of wallet.

By focusing on personalization efforts that foster customer loyalty, brands can form lasting customer relationships while improving KPIs. Blue Acorn iCi has identified how and where to personalize the experience to improve customer engagement, lower churn rate, and increase repeat business.

Build customer segments to create distinct customer journeys

Segmentation creates a solid foundation for personalized customer experiences and interactions. Crafting personas based on owned customer data, user research, and third-party data allows brands to build journeys and identify areas of opportunity for personalization. 

Once the brand’s personas are defined, the next step is to build segments by identifying customers that share common attributes. For example, “Debbie the Skincare Fanatic” is someone with a customer ID and purchased six skincare products in the last six months. Using the quantity and timeframe, a marketer can build the segment with customers that have those attributes.

Sophisticated digital experience managers enable brands to apply data science techniques to dynamically personalize the customer experience based on real-time customer behavior. With this type of advanced analytics architecture, brands can present the right message to the right customer at the right time to improve customer loyalty.

How to deliver personalized customer experiences to enhance customer loyalty

Data-driven product recommendations

Personalized product recommendations based on customer data, such as previously viewed items, past purchases, or content engagement, allow brands to present products that customers have the highest propensity to buy. McKinsey & Co. found that personalization leaders have driven 5-15% increases in revenue and 10-30% increases in marketing spend efficiency predominantly by deploying product recommendations and triggered communications with singular channels. 

Using customer segments allows brands to deliver data-driven product recommendations through their website, email marketing, and paid social media campaigns. When presented with a personalized product recommendation, 49% of customers buy items they didn’t initially intend to buy, and only 5% of these purchases are returned (the average ecommerce return rate is 20%).

With an advanced merchandising solution, like Searchspring, brands can present personalized recommendations across their entire site, from product detail page to checkout. Additionally, applying exclusion and attribution rules prevents brands from delivering frustrating personalized customer experiences. Exclusion rules dictate which products are featured to ensure shoppers only see hyper-relevant, available products. Attribution rules determine the order of product recommendations based on specific criteria. For example, recommending specific pants to match a particular top or recommending brands that customers typically purchase together.

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Relevant search results

Consumers who use search functionality are nearly twice as likely to convert than visitors that don’t, which means the search experience needs to be as frictionless as possible. Features like autocomplete, predictive suggestions, and popular searches make it easy for customers to find the right product or inspire them to explore trending products.

Search can be a clunky experience if brands don’t account for spelling mistakes, use of regional terms, or symbols and numbers. By adding a layer of intelligence to search results, brands can automatically identify and present the products with the highest customer engagement based on previous related searches.

Similar to personalized product recommendations, an advanced site search solution will allow brands to apply merchandising rules to elevate or hide products in the search results. Whether it is based on conversion rate, availability, customer reviews, or margins, these rules help brands increase revenue while offering convenient experiences for shoppers.

Tiered loyalty program for personalized customer experiences

By personalizing loyalty programs by tiers, brands can align their rewards based on desirable actions. While the primary purpose of a customer loyalty program is to retain current customers and increase repeat purchases, brands can also use them to attract new customers.

Identifying trends in customer data will help brands determine rewards, promotions, or services that are most relevant to shoppers. For example, if top spenders frequently visit local stores, invite them to exclusive store events. If a segment of shoppers often shop within a product category, provide early access to the next product release.

Tracking and analyzing metrics, such as repeat purchase rate, retention rate, account creations, and average order value, will help measure the success of the loyalty program and identify opportunities to continuously optimize rewards.

Right-time, right-place content

When brands couple data with advanced analytics, they have a holistic understanding of their customers, including actions taken before and after purchase. Based on these insights, brands can personalize their website, emails, and promotions with relevant and timely content for each individual. Keeping the website’s homepage updated with personalized content prevents the experience from becoming stale and keeps customers engaged.

Features like back-in-stock notifications and newsletters allow brands to capture email addresses and interact with customers to stay top of mind. From articles about product care tips and the brand story to announcements about just-in items, brands can deliver personalized content that motivates shoppers to return to the site.

Personalized customer experiences drive loyalty and keep shoppers coming back

Personalization has pivoted from a nice-to-have to a must-have for brands and retailers to remain competitive. With the right strategy, tools, and skill sets, companies can leverage personalization efforts to improve customer acquisition, lower churn rate, and turn existing customers into brand advocates. Blue Acorn iCi has helped brands like Capitol Lighting, First Citizens Bank, and Le Creuset create personalized customer experiences that deliver results. Reach out to learn more about how we can help you.