3 Impactful Ways to Improve Your Customer Loyalty Strategy

I think we can all agree that achieving customer loyalty these days is getting harder and harder. Marketers everywhere are shifting their priorities and evolving their capabilities in an effort to better capture and retain today’s always connected customers.  But how well are consumer-focused organizations evolving their capabilities to become more effective and relevant?

To find out, in May 2016, VeraCentra commissioned a study entitled, Fulfilling The Relevancy Promise, from Forrester Consulting (download the full study here).

Not surprisingly, top initiatives among marketers include increasing loyalty (91%), increasing long-term engagement (77%), and maximizing customer relationships (72%).

But what was surprising… the majority of marketers were more inclined to adopt basic strategies to achieve customer retention over more advanced strategies.

Our study examined the three critical strategic areas that need to come together to deliver optimum impact on customer loyalty: Process, people, and technology.

Bringing Process, People and Technology Together to Maximize Loyalty

Addressing process first, about half of the marketers surveyed actively attempt to meet the challenge of customer retention by managing customer experience across multiple touch points (58%), through loyalty/reward programs (50%), and focusing on relationship marketing versus product focused marketing (48%).  More advanced approaches such as embracing customers throughout their lifecycle and creating a seamless experience across multiple touchpoints were reported by only 44% and 40% respectively.

I was taken aback by these findings.  When you consider the benefits of the lifecycle model — aligning marketing strategy to the customer’s purchase and decision journey, promoting an integrated customer – brand relationship across all touch points, and the ability to focus marketing budget on achievable high returns, I anticipated a much greater adoption of the customer lifecycle model.

When it comes to the skill sets people bring to the table, the study revealed a trend toward adapting expertise at a slower pace — preferring to leverage internal skills over seeking outside agency or analytic assistance.  This response was more expected and in line with what we commonly hear among consumer facing organizations.

However, those companies utilizing agencies to supplement missing skills and then orchestrating functions and outcomes in a coordinated fashion, were achieving a greater impact on their loyalty initiatives versus those companies who do not.  This is alignment with the potential value a third party relationship can bring.  Easing in change, achieving quick adoption, reducing risk, and accelerating ROI are all valuable benefits of working with outside partners.

This was the case with one of our clients, PriceSmart (the “Costco” in the Caribbean, Central or South America, with over $3 billion in revenue and 2.8 million cardholders).  After multiple years working internally to achieve member insight, working with VeraCentra provided valuable insight for critical marketing decisions in just six months.  For more details, download the case study here.  

Lastly, the Forrester study indicated the continued use of “point” technology tools over an integrated closed loop marketing ecosystem.  Basic use of CRM tools was naturally extremely high (81%).  Yet 59% of the marketers surveyed indicated generating customer insights and intelligence as “very challenging” or “extremely challenging”.  In addition, 55% of marketers stated increasing marketing operations efficiency as very or extremely challenging.  This confirmed what we typically encounter when evaluating a client’s suite of technology tools.   It’s clear, silo point systems continue to prevail, yet no one system encompasses all the capabilities needed by marketing to overcome loyalty challenges.

More advanced approaches include system and data integration, across and among multiple systems (both digital and offline), to facilitate the full customer view and advance the capability to deliver in-moment relevant communications. This approach can “power up” point systems, improve agility and create incredible marketing efficiencies.

 3 Impactful Ways to Improve your Customer Loyalty Strategy

Those companies employing advanced people, process, and technology strategies reported these strategies had greater impact on their ability to maximize relationships, increase customer engagement, deliver relevancy, and increase customer loyalty.  Top strategies deployed by these organizations include:

  1. Embracing the customer throughout their entire lifecycle—creating a seamless experience across multiple touchpoints.
  2. Utilizing third party support for greater expertise and faster traction
  3. Integrating systems to create a marketing infrastructure that facilitates customer insight and the delivery of relevant communications across all customer touch points.

Download VeraCentra’s Commissioned Study, Fulfilling The Relevancy Promise, from Forrester Consulting, here.

 

About the Author:

Connie is passionate about customer relationship strategy and truly understands consumer behavior.  An executive level advisor for some of the world’s most prestigious brands, Connie has a track record of delivering game changing customer strategy alongside significant bottom line results. Through the years, companies such as GE Capital, Intuit Software and Costco Wholesale have sought Connie’s expertise.  Connie is President and Founder of VeraCentra, a Customer Relationship Agency.

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VeraCentra’s Closed Loop Solution is an integrated approach that brings together relationship strategy and data scientist teams to overcome technology and data challenges to help yield actionable customer insights.  And our Journey design services coupled with our digital platform integration team work in parallel to advance action, creating and automating customer messages.  Our Closed Loop Solution is fully integrated, allowing you to realize a quick return on your customer relationship marketing investment.