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[Infographic] Retail Loyalty: Acquisition, Retention and Customer Lifetime Value

Loyalty programs enable a two-way “dialogue” between retailers and consumers.  Consumers gain a voice through their transactions, behaviors, profiles and preferences. Retailers “listen” to consumers by collecting data across the enterprise ecosystem.  Data is turned into insights to drive loyalty outcomes.

In order to create a single view of the customer:

  • Understand how they are engaging with your brand
  • Identify touch points that shape the customer journey
  • Deliver meaningful and targeted communications across preferred channels

 

Improve Customer Lifetime Value (CLV)

By identifying your customers and their profitability over time (CLV), brands can create a unique segmentation and communications strategy.

  • Create a strategy and appropriate tactics to: acquire the “right” customers, retain existing customers, stop incentivizing and rewarding unprofitable customers, drive incremental behaviors, and impact the mix of merchandise and service across brands, regions, channels, etc.

— Be Mindful that —

  • Your loyalty program, like your company, has a lifecycle. Your CLV will evolve over time; so should your loyalty program and your go-to-market strategy.

— Seek To —

  • Optimize campaigns across channels by segments or tiers
  • Deliver more relevant offers and rewards
  • Perform look-alike modeling or other techniques to improve strategy
  • Use analytics to uncover hidden opportunities to improve frequency, spend, cross-sell and up-sell
  • Drive more profitable behaviors and purchases
  • Encourage customer engagement and advocacy through content, social and referrals
  • Identify emotional drivers and moments that matter

— It’s Worth Noting That — 

  • Returning customers spend on average 67% more than new customers
  • A 5% increase in customer retention can lead to a 75% increase in profitability
  • Improved engagement increases:
    • Cross-sell by 22%
    • Drives up-sell revenue from 13% to 51%,
    • Increase order sizes from 5% to 85%

— Retailers Taking Note —

  • Kohl’s “Greatness Agenda” aims to increase sales to $21B by 2017 through:
    • Product relevancy at the local store level
    • New channels of distribution and seamless digital experiences
    • Personalization across touch points
    • Acquisition of more core customers and growing audience segments
    • Investing in Kohl’s Yes2You Rewards which is now at 33M members after its first year
    • Insights-driven pricing and promotions
    • Associate engagement and customer engagement
  • Walgreens Balance Rewards – now over 82M active users
    • Drives valuable insights for efficient targeted promotions
    • Store wide events that build loyalty
    • Increases engagement and boosts the bottom line
    • Drives sales and margin growth
    • Improves customer experience through customer care and convenience

 

With all this in mind, what’s your listening-responding customer connectivity like? We can help you improve it – no matter where you are on the dialogue spectrum. For questions on this content, your new or existing loyalty program, marketing and communications strategies, or other inquiries, contact: info@kobie.com

Retail Loyalty: Acquisition, Retention and Customer Lifetime Value

Presented By Kobie Marketing: Experience Loyalty

Sources:

Bain and Co.: http://www.bain.com/Images/Value_online_customer_loyalty_you_capture.pdf

Bain and Co via: http://www.forbes.com/sites/alexlawrence/2012/11/01/five-customer-retention-tips-for-entrepreneurs/

Constellation Research via: http://influitive.com/blog/customer-engagement-loyalty-revenue/

http://risnews.edgl.com/retail-news%5CKohl-s-Greatness-Agenda-Continues-to-be-Key-Driver-of-Growth103128

http://risnews.edgl.com/retail-news%5CWalgreens–Loyalty-Strategy-Drives-Behavioral-Change97136

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Author: Kobie Marketing

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