You’ve heard it before: “It’s not personal, it’s business.” But that absolutely should not be the case when it comes to customer loyalty. Where loyalty programs are concerned, getting personal makes for better business. Jeff Rosenfeld summarized it beautifully when he said: “Personalization is the new loyalty.”
If you don’t know your customers’ interests, preferences, and history — and interact with them accordingly — you are stuck in the dark ages of marketing. But fear not, there is a way out!
Why Personalization Matters
According to McKinsey & Company, targeted communications that are relevant and useful can create lasting customer loyalty and drive revenue growth by 10 to 30 percent. Ultimately, consumers are more likely to do business with a company if it offers personalized experiences.
Personalization tells the customer that the brand truly values their relationship, and it reduces unwanted and irrelevant communications. From the brand perspective, personalized experiences translate to deeper insights and more robust customer profiles. That’s great news for the bottom line.
Why Personalization is Hard
Most marketers know they need to understand their customers and prospects personally. Nearly 100 percent said in a study this year by Evergage/Researchscape International that they “believe that personalization helps advance customer relationships.”
Unfortunately, the same Evergage study also showed that only 31 percent of marketers believe their peer group is getting personalization right, and marketers aren’t optimistic about their own personalization efforts. Just 12 percent are “very” or “extremely” satisfied and 38 percent are “moderately” satisfied with their performance. Forrester’s Loyalty Playbook reported that less than half of loyalty marketers use experiential benefits or personalization to tailor offers and brand interactions.
So, what’s the problem? Evergage reports that 55 percent of marketers believe they don’t have enough data insights for effective personalization and are challenged when tracking customer journeys across channels. Without the right data, you certainly won’t be able to leverage machine learning, which can help to track consumers’ behavioral patterns and uncover correlations between multiple data sets to enable the desired micro-personalization.
What You Can Do
For a top-notch loyalty program that your customers will love, you need a data-driven loyalty system that will help your organization streamline the personalization process. Look for a solution with:
A modern, cross-channel platform that handles burst messaging
Real-time capabilities that adapt to consumer behavior and preferences
Machine learning prowess to analyze demographic, behavioral, transactional, and contextual data
Your system must also be able to simultaneously process millions of digital signals and create real-time interaction profiles of each and every customer. It sounds overwhelming — and it can be — but today it’s “personalize or perish.”
Understanding how your loyalty program stacks up when it comes to personalization best practices is an important first step in taking your loyalty program to the next level. That’s why we developed the Loyalty Report Card to help you quickly evaluate the core features of your loyalty solution and identify areas for improvement.
This article originally appeared on the Stellar Loyalty blog. Read more about Cheetah Digital's acquisition of Stellar Loyalty.
About the AuthorMore Content by Manoj Das