Leveraging Loyalty: Can Businesses Digitize Customer Retention?

Customer retention is a core component for all ambitious businesses, but can loyalty be digitized to great effect?

Many businesses mull over how to optimize customer retention, but a startling number of decision-makers still struggle to understand that customer loyalty is about more than just selling products.

Today, to retain more customers, businesses must apply their efforts and resources to provide a level of service that can appeal to customers in an engaging way.

While it can be easy to lose the trust of customers, it takes time and care to build it up. Fortunately, these processes can be optimized in a digital environment to help build strong relationships between a brand and customers.

Optimizing Social Engagement

When it comes to leveraging a customer retention strategy, social media is a key consideration for virtually all businesses.

Through social platforms, it’s possible to keep customers informed and nurture new leads about your brand, upcoming events, special offers, and product discounts.

Crucially, social proof and social selling are also excellent ways of attracting customers by demonstrating their credibility using other trustworthy sources.

Whether you use social media to highlight positive expert comments or an influencer endorsement, you can leverage the right platforms to showcase your brand and products in the best possible light.

\In the above excerpt from the Starbucks X account, we can see that the brand is no stranger to utilizing social proof in the form of a positive repost or a celebrity endorsement to boost engagement.

Build Analytical Insights from Behavior

Customer loyalty offers key tangible and intangible benefits for businesses, particularly when it comes to data collection.

Loyal customers who regularly interact with a business can indirectly offer more data and insight into predictive analysis initiatives.

The great thing about the insights leveraged through customer loyalty is that they can provide actionable information on what exactly caused them to become so engaged with your business.

Factors like your products with the best competitive advantage, the best target demographics for certain products, whether customers are willing to increase their spending, and the average lifetime value of a customer can all be analyzed through the behavioral insights from your most loyal customers.

Create Rewards to Compliment Behavioral Patterns

For rewards to be most effective, they must leverage a positive action. For instance, if you want to increase your average order value, a restaurant can add a complimentary drink with a certain meal deal.

But how can you set up rewards to complement a digital customer retention strategy? There are three key principles that all businesses can follow to maximize their performance.

Firstly, businesses should go beyond discounts in order to reach new leads. Applying too many discounts can lead to negative perceptions of a product’s quality and the cheapness of your brand. Rather than discounting, adding bonuses like free delivery on orders over $50 can motivate customers to receive a reward for buying more.

You should also look to distribute simple rewards for loyal customers. Rather than offering a freebie every 10 orders, keep customers motivated to come back by offering a smaller reward for every two or three orders.

Finally, make sure that you are seen to recognize your customers through your rewards systems. Whether you offer them a special birthday discount or a reward as part of a referral scheme, this can help customers feel valued and motivated to continue promoting your brand.

Leverage Personalization

The single best way to generate more customer retention is to build an emotional connection between your customers and your brand. This can be done through personalization, and customers can feel more valued when their experiences are tailored to suit their own wants and needs.

Statistics suggest that 80% of shoppers are more likely to make a purchase with personalized experiences, but leveraging personalization means utilizing more customer data.

This is where the behavioral analytics you’ve amassed can become useful for developing insights based on previous purchases, brand preferences, and key shopping habits. Using this data in an affirmative way can help you showcase your most effective products and services under the noses of your most receptive leads.

Building Segments for Lost Customers

Another key component of customer retention is to reclaim your customers who have fallen through the cracks of your loyalty scheme in recent months.

Be sure to set up a bespoke promotion that can lure lapsed customers back into making regular purchases with your business. In addition to this, customers who have abandoned an online shopping cart could receive email reminders that their items are still available to buy.

These measures can actively encourage retention and show customers that your brand considers them valuable enough to engage with if something seems wrong.

Harnessing the Power of Loyalty

Managing customer retention is key for ambitious businesses of all sizes. It can be a powerful tool that positively impacts loyalty and maximizes growth prospects.

By prioritizing customer needs and meeting them, a digitized strategy can help organizations build strong and lasting relationships with their customers.

Leveraging loyalty is about more than just marketing a brand accordingly. It has to be a business mindset where the customer can feel prioritized through meaningful connections and interactions. It’s through this carefully structured approach that a business can build a sustainable connection with those who matter most.