3 Strategies to Improve Customer Acquisition and Retention
Retailers today are faced with more competition than ever before, making it challenging to both attract and retain customers. Customer expectations are elevating too, driven by new technologies from point-of-sale engagement and artificial intelligence engines all aiming to enhance the shopping experience. Marketers must put their customers first by using data intelligence to stand out from the competition and engage with them in meaningful ways.
It’s been proven and well-documented that retention is more cost effective compared to acquisition, yet oftentimes marketers fail to engage customers post-purchase to make them excited about a repeat buy. To build brand loyalty, marketers must hone in on preferences of individual customers to ensure they're capturing shopper attention and activating them with relevant touchpoints throughout the entire purchase journey.
According to recent research on shopper dynamics, 34 percent of consumers have one preferred retailer by purchase category. This means two things: marketers have an immense opportunity to build loyalty and improve retention and, on the flip side, are more at risk of losing customers to competitors.
Let’s look at three acquisition and retention strategies.
Personalize Promotions and Rewards
Retailers that personalize the customer experience with targeted messaging and promotions/rewards will better connect with customers. To earn their loyalty, research revealed 73 percent of customers want to be rewarded with personalized discounts or special offers.
Robust consumer data provides insights on factors like interests, demographics, location and purchase behavior (including cart abandonment). Ideally, retailers should unify data between channels and across devices. A 360-degree view of a consumer’s real-world shopping habits enables marketers to create highly targeted campaigns that balance personalization and scale to drive sales lift. Marketers must engage with consumers at appropriate touchpoints leveraging multiple media channels — mobile, email, direct mail and online display — with relevant, targeted content, messages, offers and recommendations.
Retailers also have a long history of using customer loyalty programs to drive repeat purchases and long-term rewards for shoppers. Data platforms exist today to not only be reliant on undervalued loyalty programs. Using the right identity resolution tools, marketers have the opportunity to re-engage lapsed and current shoppers alike to drive loyalty and increase share of spend.
Integrate Print and Digital Campaigns
We live in an omnichannel world where retailers too must take an integrated approach. Twenty-eight percent of consumers say receiving an ad in both print and digital media encourages them to shop at a new a store/website or visit one they don’t shop at often. There's an immense opportunity to use print and digital campaigns to build customer loyalty. Having multiple, ongoing touchpoints is also effective, as 73 percent of consumers typically shop at retailers that have reached out to them throughout the year.
Optimize In-Store Experiences
Brick-and-mortar retailers are still a prime destination for consumers, as 96 percent say they shop in-store for apparel, shoes and accessories, according to data from the 2018 Purse String Survey. Marketers must provide compelling in-store experiences with specific calls to action, as well as convenient and streamlined checkout. In-store experiences should offer unique options that aren’t available online. This approach will help to increase foot traffic and in-store sales.
Retailers are transforming their in-store experiences, driving convenience. For example, during the holidays, retailers promoted buy online, pickup in-store (BOPIS). And consumers responded. An Adobe Analytics Study found that BOPIS increased more than 46 percent October through December 2018. Retailers like Best Buy, Target, Lowe’s, The Home Depot, Kohl’s and Walmart reported BOPIS positively impacted their holiday sales and are planning to expand the offering.
To further drive convenience, retailers should integrate innovative technologies like cashierless checkout and digital wallets. A recent study of mall shoppers found that 51 percent have yet to encounter this in-store technology. Yet this technology creates shorter lines and wait times, highly valued by consumers along with greater savings and in-store customer service. Conversational ads, powered by artificial intelligence or chatbots, also deliver a personalized marketing experience, helping businesses engage their target consumers with real-time, on-demand experiences at scale.
Using the right approaches to customer acquisition and retention drives profitability. It’s clear retailers providing personalized offers, a cross-channel approach and unique in-store experiences will stand out in a fiercely competitive environment. They will be rewarded with customer loyalty and improve long-term relationships with existing customers.
Curtis Tingle is chief marketing officer of Valassis, a leader in intelligent media delivery and creating cross-channel campaigns through direct mail, digital and print advertising, and marketing strategies.
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