Six Steps for Improving Customer Engagement and Loyalty
Customer shopping patterns have been totally upended during COVID-19.
A recent McKinsey report found that 77% of consumers have tried new brands, places, and ways to shop during COVID-19, putting customer loyalty at risk. Retailers are left struggling to identify both how to retain loyal customers at risk of shopping elsewhere, as well as how to create loyal customers out of new shoppers.
Surprisingly, though, retailers are falling short in customer loyalty. A new research report from dotdigital found that 80% of omnichannel brands don’t have a customer loyalty program; a missed opportunity that can directly impact the bottom line. More than one-third (35%) of loyal customers will spend more on a brand’s products even when there are cheaper options elsewhere. They also serve as brand ambassadors, with 56% willing to recommend a brand to their friends.
Loyalty programs are valuable ways to increase customer engagement, especially at a time when so many retailers are struggling for sales. They improve customer retention, drive incremental sales and help brands better understand their customers through rich data such as birthday, gender, sizing, favorite color, or brand preference. All of this is valuable information that can help retailers personalize their offerings.
Establishing a loyalty program is a fundamental first step to improving customer loyalty. However, there are other key strategies that can help improve customer engagement and retention.
Here are several to consider:
Put the shopper in control. Two-thirds of brands don’t offer customer preference centers, missing the opportunity to put shoppers in control of their relationship with a brand. Empowering subscribers to choose the communications they receive, and the channels through which they receive them, significantly improves the customer experience.
Include product recommendations. Be sure to incorporate relevant, timely product recommendations into landing pages, email campaigns, and shopping carts. AI-driven product recommendations can improve contextualization and enable messages such as “next best” or “people also bought.”
Recover abandoned shopping carts. If a user abandons a cart, send a timely nudge to remind them to check out. You can always include a small incentive a few days or a week after. Don’t send more than three emails though, as you don’t want to annoy potential buyers.
Remember to say ‘thank you.’ Aftersales programs are an important aspect of triggered messaging that helps retain customers long-term. Start with a “thank you” email, then follow up with useful content that helps your customer make the most of their new purchase.
Win back at-risk customers. Shoppers that are classified as “at-risk” are those who have not returned to purchase from you within a particular time frame. Since it costs five times more to acquire new customers than it does to retain your existing ones, when customers begin shopping elsewhere it represents lost time and money.
By putting these customers into a segment and targeting them with emails that surprise and delight them, you can encourage them back to your site. Remind them why they chose to shop with you in the first place by showing personalized offers. These could be welcome-back offers, double points on products they’ve previously shown interest in, or a free birthday gift. You could even use emails to notify them that you’ve moved them up a loyalty tier. This way, they’ll have more reasons to return to your store to make the most of the new benefits they’ve unlocked.
Respond quickly to customer queries. Omnichannel brands that were surveyed in dotdigital’s research placed a high premium on rapid response and engagement with shoppers, with 64% of them responding to queries within 60 seconds. In addition, 71% have bots or dedicated customer response teams. Answering shoppers’ questions quickly is a proven strategy to improve the customer experience.
The accelerated shift to e-commerce following COVID-19 is a once-in-a-lifetime opportunity for omnichannel retailers. However, they must do a better job of cultivating customer loyalty, which is essential in increasing lifetime customer value. They can do this by adopting strategies that improve loyalty and by leveraging customer data in order to improve relevancy, engagement, and emotional connection to their brand.
Genelle Kunst is Americas head of marketing, dotdigital.