When we know that engaging an existing customer is ten times cheaper than converting a prospect, and that fierce competition is right around the corner, investing in solutions and strategies to engage customers and build loyalty is one of the most important and profitable approaches for attracting and retaining customers. In this first of three articles, we will learn about the importance of having a 360-degree customer data strategy.
360-Degree Customer Data: Not Quite as Simple as It Seems
Customer expectations have greatly changed over time: they increasingly expect companies with whom they conduct business to know and answer their needs and queries unconditionally. Most of all, they expect the customer experience to be as good online as it is in the store or over the phone. To better understand and properly address the customers’ needs, companies cannot rely only on customer data they can collect to send out promotions—a practice that evolved a great deal in recent years, but also one that will soon reach its limits in terms of performance. Companies who want to stay competitive are now shifting to the 360-degree data mindset; they need to learn to collect, analyze and use data to attract their customers and build loyalty by offering engaging and strong customer experiences, generating both value and results.
What Is the Value of a Loyal and Engaged Customer Base?
86% of customers will pay a higher price (up to 18% in some cases) for a better experience.
73% point to customer experience as an important factor in their purchasing decisions.
65% find a positive experience with a brand to be more influential than great advertising.
72% of customers will share a positive experience with 6 or more people.
Loyalty Programs: When Data Brings Value
Putting together a loyalty program is one of the most efficient ways to engage customers and build loyalty. Gone are the days when we were simply accumulating points based on the amount spent. Today, loyalty programs come in many models; some of them are custom-made while others are outsourced. Loyalty programs in the digital age is also a great way to collect valuable customer data in exchange for an exclusive, unparalleled customer experience.
Single Source of Truth?
One challenge faced by companies that develop new, innovative, multi-channel loyalty programs and new engagement strategies is that, at a certain point, when they look at the digital ecosystem, they realize that there is no such thing as single source of customer truth. Customer data rather comes from several systems and quickly becomes a headache for the different teams (marketing, sales, customer service, etc.) who want to develop programs, solutions and customer journeys to deliver attractive and profitable experiences.
Regulations and Compliance
Another important (and big) challenge is complying to new regulations and legislative requirements that protect the customers’ right to confidentiality. Consequences of a potential non-compliance can be quite costly to companies, and have adverse effects on their reputations. What’s more, customers are more and more aware of their rights and legal remedies when rules are not followed.
I recently had an experience with a loyalty program that suffered from a lack of data orchestration, which resulted in a clash between the company and I. Here’s the case.
With the relaxation of public health measures and the reopening of movie theaters, I was excited to finally go see a movie. I had to book online since there were still limitations in terms of seating because of social distancing.
On the theater’s website, during the reservation process, I was encouraged to subscribe to the loyalty program; they were offering a substantial amount of bonus points if I were to use my new member card before the end of the year.
I subscribed, and used my loyalty card during checkout without a hitch. I noticed on the mobile app that the bonus points had already been transferred to my account.
Moreover, I received an email (three days later) to confirm the allocation of my bonus points. Three days is a little bit long. An automatic email sent and received in real time would have worked better during the actual activation (and transaction) process to engage the new member. But that’s OK. At that point, everything had worked out fine.
But what unfolded next was not supposed to happen. Five days after my subscription, I received an SMS reminding me to use my member card before the end of the year to obtain my bonus points.
Why was I reading this?
Was there a problem with my account?
Slightly worried, I logged into my account only to see that everything was in order.
False alert. The points had been loaded up into my account.
This is what we refer to as an orchestration failure caused by siloed data. The SMS, which is given high priority by most recipients, has been sent in a disorganized manner in relation to the emails, most likely because the marketing system used was not fed with real-time data, and there was no validation process in place in the messaging sequence to confirm if I had actually “consumed” the bonus offer. You’ll probably find that it was not a serious offence, but it made me look twice. I had to check that my experience with the program was not broken. It’s an unfortunate situation that could have been avoided.
Orchestration Mistakes Are More Common Than You Think
In another case, I dealt with an airline to plan a trip. I received notifications related to that trip for weeks (namely about the activities I could do after reaching my destination) even though my trip was cancelled a few weeks before my departure. The cancellation never reached the systems that orchestrate the customer journey attached to my trip. And in yet another program, my account was cross-referenced with that of another member following a call with customer service. To this day, they are still not able to reverse the procedure. And so, I still receive customized messages intended for another member.
Down With Luck?
Given my individual experience with loyalty programs and digital marketing projects, I can assure you these situations are more common than you think. The good news is they can be avoided or at least rectified. In the next blog post, we will be exploring the five mistakes to avoid when implementing customer experience programs and solutions!