How to Leverage Your Data, Part 2: Improved Financial Results from Higher Engagement

TimGlomb-Headshot_studio.jpgTim Glomb, VP of Content and Data, Cheetah Digital
Having the right customer data allows you to create personalized experiences that drive measurable revenue.  If you collect zero-party data from customers that includes psychographic information that can not be deduced or inferred, you have the power to persuade in your direct-to-consumer channels.  You can send an email or sms message with hyper-relevant content that inspires and persuades a future purchase.

For example, DECKED, a global manufacturer of vehicle storage solutions, offered a sweepstakes survey to a targeted segment of customers that totaled just over 150k as a test.  They collected psychographic zero-party data about each customer’s recreational passions, their vehicle storage needs and their future budgets. After each entry was submitted, they fired back an automated, personalized email to each entrant filled with dynamic imagery and copy that aligned to each customer’s declared lifestyle and positioned DECKED’s accessory lineup as ‘must-have’ products to enhance their recreational time in their vehicle. 

This direct to consumer, personalized content drove a 70% open rate with the highest rate of revenue from any marketing campaign to date.  This one-off test campaign tactic is now an ‘always-on’, data collection and personalized communications strategy for both new and existing customers.
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Tom-Caporaso-Clarus-Commerce.pngTom Caporaso, CEO, Clarus Commerce
Increasing customer engagement should be a priority for every retailer, especially coming out of the pandemic.

While engagement has shown to directly increase financial metrics like average order value, order frequency, and customer lifetime value, it also creates a halo effect that leads to indirect financial results as well.

That’s because engagement is more than just making a sale – It’s every single touchpoint that your customers have with your brand. For example, a social media interaction, a survey filled out, or a visit to your brick-and-mortar store are all examples of engagement.

The better the experience you can provide at any engagement, and the more data you can collect about your customers, the more you can find ways to add value to your loyalty program.

Our latest Premium Loyalty Data Study found that 89% of respondents would recommend a retailer to family or friends if the retailer’s premium loyalty program offers valuable benefits. And 94% of premium loyalty members shop at that program’s retailer at least once a month.

That’s why it’s critical to make every engagement count. The more engaged your customers are, the more they will spend, and the more they will evangelize for your brand to their social circles.

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Sandra-Sydlik.pngSandra Sydlik, Marketing Specialist, Stuzo
Customer loyalty is not a program or set of rewards, it is the outcome of good engagement. It is the result of building relationships with customers over time that deliver value, both to the brand and the customer. Therefore, brands want to build engagement programs that guide customers through personal journeys to gain a greater share of wallet in the spend categories that drive financial results for the brand.

It starts with understanding how a customer currently shops. Of all the purchases a customer makes, some are with your brand and the rest is with the competitor. In addition, each customer has different wallets across all of the categories they typically buy (e.g. fuel, merchandise, tobacco, etc.). This means that each brand has an opportunity to steer more of customers’ existing behavior to their brand. Real-time hyper-personalization of offers and rewards is a great approach and when paired with journeys that programmatically guide customers along a path to more loyal behavior, this leads to more visits, bigger baskets, and greater customer lifetime value.

Brands like Starbucks and Dunkin Donuts in the quick serve restaurant category or Murphy USA and Wawa in the fuel retail and convenience store industry do an excellent job of delivering immediacy of value for both, the consumer and the business.
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Emil-Sarkissian.pngEmil Sarkissian, CEO, Loyalty Methods
What ultimately drives financial results for brands is profitable consumer behaviors that are actively chosen by consumers. Engagement is about creating a focused interaction space through the careful engineering of customer journeys in which these types of behaviors are encouraged and nurtured. It is very much like creating little stories in which the customers see themselves as prominent actors, and where the choices and interactions are structured in a way that encourages profitable behaviors, while at the same time leaving them with a sense of purpose and connection. It is also about adding meaning to economic transactions in a way that increases the perceived value of these transactions.  

It is interesting to consider Maslow’s pyramid of needs as a thought model for engagement and loyalty, where an economic transaction is at the base of the pyramid to meet basic needs, and a rich, engaging customer journey sits at the top to meet self-actualization needs.  

Higher consumer engagement leads to better financial results as it establishes a continuous conversation context which adds meaning to economic transactions by making them part of a relevant dialog rather than isolated one-off encounters.

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Adhish-Kulkarni-mugshot.jpgAdhish Kulkarni, SVP and GM Digital Engagement & Loyalty Solutions, Evolving Systems
We need to actively address customer churn; acquiring a new customer is much more costly that retaining ones, who can build a strong emotional attachment with the brand which helps lower retention costs, and who are also open to cross-sell and upsell proposition. Engaged customers will likely be your brand advocates, driving viral acquisition through personal recommendation and participation in member-get-member schemes. This equates to increased customer profitability – longer tenure and higher spend.

For example, one our customer’s program focuses on three channels of engagement; exclusivity of access (such as tickets to a popular event); competitions (offering prizes); and seasonal offers such as Christmas promotions. Ongoing monitoring allows for continuous improvement of the app and therefore engagement, management and experience to increase Net Promotor Scores.

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