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Gone are the days of anonymous punch cards. Today’s customer loyalty programs incorporate sophisticated data segmentation efforts to better understand the end customer and purchasing patterns. Brands are working to personalize communications, offerings, and recommendations to build relationships with their customers beyond the transaction.
Loyalty360 spoke with supplier members to discuss the topic of segmentation and personalization, and the effects they have on customer loyalty.
Raising the standard with a new standard
Nearly every brand is working on incorporating personalization efforts into its loyalty program, but the level of sophistication varies depending on a number of factors.
Ingrid Sierra, VP International Marketing and Customer Experience at Tenerity, believes that all brands are making some personalization efforts. Some are still in the initial stage of only personalizing on demographics or using explicit raw data (such as name, location, previous purchases); however, most brands are now looking to go further, using complex algorithms to present next best offers to customers based on a contextualized and commercially influenced parameters.
She says, “The exciting part of this is that we don't need to try to make consumers look like each other to be successful anymore. We can treat individuals as individuals. We can really focus on their behavior, not just their demographics. We can make sure that we're responsive to the diversity of behavior, of thought, of timing, of context. Because at the end of the day, personalization is a more advanced way to achieve the #1 objective of marketing, ‘reaching the right customers, with the right offer at the right time.’”
Matthew Kates, SVP, Strategy, Clarus Commerce agrees, saying, “Nearly all brands understand the value of personalization.”
Furthermore, Kates states two specific areas where most brands are still testing and trying to figure out how to optimize their personalization:
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