Brands have access to more customer data than ever before, but that data remains nothing more than zeroes and ones unless they have the proper tools to transform that data into useful information. Making a personalized offer to a customer is a great start, but taking it to the next level demands dynamic interaction that evolves with the changing customer behaviors.
BCG recently published an article declaring there is a 70-billion-dollar opportunity for brands to move from mass offers to personal offers. Formation is a loyalty-focused technology company that helps brands do just that.
Mark Johnson, Loyalty360 CEO, spoke with Formation CEO, Christian Selchau-Hansen, about the best technology in use today that can help brands drive unique experiences, engagement and, most importantly, customer loyalty.
World’s First Dynamic Offer Optimization Platform
Personalized offers are a great way to earn and keep customer loyalty, but as the customer changes, those offers need to change with them. Personalized campaigns need to automatically adapt to changing customer behaviors to deliver a truly one-to-one experience.
To assist with this, Formation set out to create a proprietary dynamic offer optimization platform. This patented platform makes it possible for marketers to activate first-party data by creating personalized offers for each customer using dynamic actions and dynamic rewards and automatically optimizing those offers over time.
Selchau-Hansen says, “That helps achieve much better customer engagement metrics, better financial metrics and ultimately establish a much stronger relationship with your customers.”
Customer Loyalty Begins with Engagement
Brands need to engage with the customer throughout the relationship, whether it is a new customer, a highly engaged customer, or even a lapsed customer. Brands need to think holistically about all touchpoints in which a consumer engages with the brand, product or service.
At the offset of the COVID pandemic, consumers have dramatically increased their digital engagement with brands. When a consumer interacts with a brand on the digital landscape, they are expecting a certain level of personalization, for relevant offers to come through the app, the website or emails.
It is important for brands to utilize the data collected from consumers to create specific, relevant offers to drive engagement. In order to be highly engaging in today’s world with today’s customers, brands need to focus on relevance. That is what ultimately delivers value.
Effective Use of First and Zero-Party Data is Key
The effective use of customer data is one of the single biggest challenges that brands face today. When a customer shares their data with the brand, they expect the brand to use that personal information to create a more relevant experience and more value in return. Brands need to demonstrate the payoff to the customer.
Selchau-Hansen explains, “Effective use of data is it that exchange. The challenge is connecting the technology systems to recognize consumers at the first point of contact.”
Customer loyalty programs are focusing on zero-party data and how to demonstrate the value to the customer. One way to demonstrate that is by applying technology around gamification.
Says Selchau-Hansen, “Gamification has been a misunderstood application within the industry. Badges or certain aspects of games are applied with no core value to the experience. Those badges alone do not drive incremental value for a customer. But when it is applied well, it makes a substantial difference.”
When people participate in games, whether it is a physical game like a sport, there is a need to see the progression: is the participant going to win a point, a set, a game, or a tournament. There is a natural progression toward a final goal. In a loyalty relationship, brands need to demonstrate the progression to a customer.
Applying gaming mechanics in the right way will show customers a clear path toward more value, a better experience, and more benefits from their relationship with the brand, product or service.
Start Small. Experiment. Find Out What Works. Scale.
The martech landscape of possibilities is endless, and choice consequence is present within many marketing organizations. With nearly unlimited resources, and choice in technology and new processes, marketers need to find the right fit for their specific company needs.
Selchau-Hansen offers this advice. “Don’t wait for perfect. Pick one and try it out, see what works, then figure out how to scale what works from there. Your customer and competitors are not waiting around, and neither should you.”
Technology is a learning process. The customer experience spans many different touchpoints - website, mobile app, in-store, customer service – there are opportunities across all touchpoints to influence and help customers ultimately connect better with the brand.
If marketers can choose one particular use case and experiment at a small scale, they are able to see what works and what does not for their company. Selchau-Hansen stresses, “Be okay with failing because it means you are trying new things. Companies need to try different things, see what works, and then invest in that.”
Choose a Focused Technology Partner
Companies want to use technology to help personalize their loyalty programs, but it’s challenging to know which to use. It helps to partner with experts in the industry. But brands should be wary.
Says Selchau-Hansen, “When you have a vendor who says they can do it all, they can’t do it all well.”
Brands need to create an end goal and evaluate specific criteria against how to reach that goal. From there they can begin to look for the technology best suited to reach that goal.
Selchau-Hansen adds, “Start with a specific use case and find a vendor who is an expert on it. You can be confident in the software’s ability to serve your brand the way it is intended.”