We all know that loyalty is a big buzzword in retail — and it’s not surprising why. The data from Visa’s annual Loyalty Report shows that, on average, loyal customers spend twice as much.
For most businesses, gaining insight into customer spending behaviour is fundamental to understanding their customer’s journey. This knowledge is built on the data loyalty programs generate. This data is then used to craft highly personalised offers and rewards, helping boost customer loyalty and increased spend within a retailer. Alongside how much a customer spends, there are many other things that retailers can understand from transactional data, such as how often a customer shops, where they shop, what they buy and when they make purchases.
Sometimes, it may be slightly off-putting to hear companies talk about “supercharging spend.” But what if you could really supercharge your customer loyalty and their intention to spend with your brand? You can, and here’s how:
Examining the shopping experience
According to Barclays, in the UK, consumer spending declined by 7.2% in March compared to the same period in 2019, but there are signs of recovery from the previous two months of lockdown.
The pandemic taught us that customer loyalty and spending can be increased by improving the overall shopping experience for customers, starting with examining the customer journey.
Together with the prominence of suggested and personalised offers, customer journeys can be captured in a CDP (Customer Data Platform). This platform will offer you a unified customer database that contains comprehensive customer profiles with insights into their interactions with your brand, from how they purchase and engage with your company to feedback on your staff’s performance.
Integrating these customer insights into existing marketing strategies supplements the available customer and shopping behaviour information. When used well, it encourages the customer to progress from merely wanting to buy to converting and completing their journey with a purchase.
An interesting area to explore as part of your customer journey capture is what customers read or note. Here, enhanced contextual advertising is possible in relation to both online and offline behaviour. Just as with customer journeys, allowing customers to tell their stories can supercharge sales. The extent to which you can offer this will, of course, depend on the specifics of your customer engagement channel.
One important thing to remember is that even if your customer base isn’t overly “locally focused”, social media can still be an excellent way to engage with your relevant target audience by sharing news that is more likely to encourage a purchase.
Understanding customer behaviour through data
It’s hard to have great CX and increase customer spend in retail without the valuable customer insights into how they interact with your stores. Knowing what customers are doing across every touchpoint can help you create a better experience and identify potential areas for improvement in your model.
It’s unlikely that a customer is going to spend more than they intended to organically. Therefore, retailers need to convert intention into behaviour by using omnichannel triggers, such as offering discounts for online purchases if customers opt into in-store contests or recommend a product or service to a friend.
Studies have found that people tend to prefer buying things based on a discount code, content platform, or social media channel that they find particularly appealing. If you know when shoppers make their purchases and how they got there, you can use that to tailor your offers & campaigns to that particular moment in their journey.
Gaining insights into how a customer is interacting with your brand is even more powerful. Let’s say you learn which customers make the most frequent (and therefore profitable) purchases and total spend. In that case, this data will enable you to target this specific customer segment with better offers that have a higher positive impact on the bottom line and are more likely to convert.
Alongside transactional information, such customer insights will allow you to build loyalty programs that will turn this data into marketing strategies. Our customers use the TRU Loyalty integration to encourage spending and repeat visits. This is achieved by creating a blend of personalised brand experiences and customised real-time interactions with their customers, such as offers and rewards placed at precise moments in the buying journey.
As well as giving you insights into how customers engage with both in-store and online retail, behavioural data can also be designed to pull together customer profiles (i.e. what, when, and where they shop), enabling you to determine their spend intention factors (spending intention, frequency, or motivation), their levels of engagement and how they transact.
Use customer analytics to make informed decisions for the futureHow customer spending insight can help supercharge customer loyalty and spend in retail
Collecting valuable pre-sales customer data through specific channels (online, in-store, etc.) will give you a thorough picture of a customer’s characteristics, interests and motivations. This data can give you a bird’s eye view of the many stages involved in a customer journey, and then on, you can determine where they may be headed in the future.
This could mean a head start in improving your website UX ahead of a sale or promotion. If not, merely improving the UX in harmony with your customer journey data will give you a good indication of what strategies are working and which need improvement.
The customer journey is a series of plays — each one informed and shaped by the previous ones. You can’t be 100% certain of every move your customers will make, but as a business owner, you must understand where customers are starting, what they’re using your business for and what they are likely to do next.