Attracting and maintaining loyal customers is becoming increasingly difficult as more and more businesses join the market looking for a piece of the customer-loyalty-pie.
Not only is it important to maintain a degree of customer loyalty to stay competitive, but it helps with costs too.
In fact, it costs 5 times more to acquire new customers than it does to retain existing ones. It’s also far easier to sell to existing loyal customers since 50% are more likely to try a new product of yours and spend more than 31% more than new customers.
Traditionally, businesses would largely have to rely on word-of-mouth marketing to attract new customers. In the past, a new competitor entering the market would cause panic and a business would have to compete by cutting prices.
So, what has changed? How can businesses build and maintain customer loyalty? And in what ways has technology supercharged their ability to build and nurture customer relationships for the long-haul?
Building customer loyalty with technology
Advancements in technology have changed the way customers buy from and interact with businesses and brands. From online shopping to virtual personal shoppers and the new ability for businesses to deliver exquisite customer care on a larger scale, customers are more loyal than ever and here’s how.
Artificial intelligence has helped retailers to increase customer engagement, boost contemporary consumer demand and deliver personalized, targeted messaging on an individual basis. Many companies have already jumped on the AI bandwagon.
According to a Teradata report, 80% of enterprises say their organisation already has some form of AI in production. The same report showed that one of the top planned uses for AI was customer experience.
Using predictive analytics to give customers what they need – even if they don’t know it yet
Predictive analysis is a branch of advanced analytics that uses big data to effectively predict future events. By integrating data mining, statistics, machine learning, AI and modelling; data can be analysed for the purpose of predicting future trends.
At the heart of every successful marketing strategy is a company’s ability to understand the needs of its customers.
With the help of artificial intelligence, companies can now get deeper insights into their customer’s behaviour and predict what they will likely be looking for.
Through machine learning, algorithms explore customers’ previous buying habits to predict their future preferences.
By using this technology, companies can identify any potential threats that may affect their buyers’ journey, as well as plan for their next purchase.
For example, Sephora uses predictive analysis for their email marketing campaigns.
They have taken personalisation a step further by keeping track of each customers’ purchasing histories and then calculating how long it will take for the product to run out – they then swoop in with an email reminder on what products a customer should try next.
Spotify has implemented AI to provide personalised playlists based on what listeners like.
They’re not alone. Many big brands are using this AI strategy to enhance the buying experience and keep customers on their side – and so should you.
Supercharging customer care with technology
One of the main factors that make customers loyal to a brand is superior customer experience.
Traditionally, a business would only be able to care for a customer’s queries, questions, problems, complaints or compliments on a one-to-one basis.
Clearly, it wasn’t feasible to provide excellent care to every single customer.
Chatbots make for more effective engagement
Chatbots are able to handle multiple customer queries and resolve them instantly on a 24/7 basis. Recently, such technology has become more advanced in its ability to merely answer simple questions.
Today, chatbots can be used to inform customers about new products, events, discounts and more. They’ll even notify customers about the status of their order. These virtual spheres of information to which customers can turn to create a sense of security and commitment.
Using AI-based customer loyalty programs
The amount of information and data available today shouldn’t go to waste.
Whenever a customer takes action, be it buying, viewing or reviewing – deep learning algorithms can record it. This information can be analysed to create specific customer personas, segmented by age, interests, location and more.
With this information in-store, companies can generate better-personalised customer incentives that are far more effective. Rather than offering a one-size-fits-all program, AI lets companies tailor precisely what they offer customers in a meaningful way. A company with 5 different customer personas can create 5 different loyalty programs.
Furthermore, AI transforms customer loyalty programs by digitising them. Move loyalty programs online with chatbots – like how Marriott International did.
They linked their loyalty program to their chatbot which is available on Facebook Messenger and Slack. Customers can ask about room availability and even if they don’t book a room, the chatbot can send them links to content they may be interested in.
Virtual Reality as an effective customer engagement tool
When rich media like audio and video first hit the internet, a number of studies reported that moving images were the most effective way of grabbing and keeping a viewers attention. Today, Virtual Reality takes this a step further.
The most powerful customer engagement tool is no longer within the realms of the internet. Of all the intuitive content, cookies and questionnaires imaginable – it’s all 2D. The immersive capabilities of VR have become the most exciting marketing innovation in over a decade.
A study by Nielsen found that consumers demonstrated a deeper emotional connection with VR content than traditional 2D media. For many, it was the new and exciting prospects of being immersed in a new virtual environment.
Marketing using VR allows companies to control what the customer sees as well as feels. They quite literally enhance the experience by creating an entirely new and immersive one.
Many companies are already working with technology developers to implement VR and AI in their marketing campaigns. Don’t let your customer loyalty dwindle, while they supercharge theirs.
Learn more about kick-starting a loyalty program here.
This article was contributed by Daglar Cizmeci, Chief Executive Officer at Red Carpet Capital Limited. Daglar has over 20 years’ industry experience in emerging tech, aviation, logistics and finance.
He’s a graduate from Wharton School and Massachusetts Institute of Technology (MIT) and has works has been published in ReadWrite, Business.com, FX Empire and Yahoo Finance.