Mike Ferguson, Vice President, Global Services, and General Manager EMEA, Redpoint Global, explains how achieving a high degree of personalisation is the key to forming and maintaining meaningful interactions between brands and customers, boosting customer loyalty and, in turn, revenue.
According to the Office for National Statistics, UK retail sales beat forecasts in April with 0.5 per cent growth, a three-month 0.8 per cent increase compared with the previous quarter. This represents the fastest growth in nearly two years, perhaps reason for cautious optimism amid an uncertain economic outlook.
However, to keep customers on-side and maintain this momentum, businesses must prioritise meaningful interactions with their customers. As customers, we want the local corner store experience every time we interact with a brand, from the enterprise level to the, well, corner store. Online or in-store, we expect a brand to know what makes us tick as a customer. The more a brand knows about us, the better it’s able to provide value in terms of a highly personalised, relevant customer experience – every time and anywhere we engage.
This is demonstrated in a recent Dynata survey, where 74 per cent of consumers said that feeling valued and understood by a brand was the key component in brand loyalty, 64 per cent said they would rather purchase a product from a brand that knows them, and 34 per cent said they would spend more money on the product to do so.
Advanced personalisation and revenue
With consumers loosening the purse strings, how can retailers create revenue growth through the delivery of a personalised experience?
First, as mentioned, is creating a meaningful interaction anywhere, at any time. This means omnichannel; where a retailer recognises a customer as the same person across all channels in the context of an individual customer’s journey. It is the local DIY shop knowing what stage of a renovation project we’re in, knowing the parts and materials we bought last week, and what we need next. For an enterprise, this translates to a call centre agent knowing about our latest online browsing session or social media post and engaging with relevance from the start of the call to the finish. It is a seamless click-and-collect experience that requires a real-time alignment between the website, SMS, email, inventory and a physical location. Omnichannel personalisation drives revenue opportunities by delivering end-to-end frictionless experiences that show a customer that you value them beyond a transactional basis.
Another way for a retailer to drive revenue through personalised experiences is to leverage the knowledge you have of multiple customers’ behaviours and interests (not just demographic and behavioural information) to take predictive action at the individual level. Delivering a personalised website experience for a first-time visitor is one example, where segmentation models using aggregated data from unified customer profiles help a brand predict what a customer will engage with or respond to.
First-touch personalisation has been shown to increase conversions and brand affinity. And, when a unified profile (also known as a Golden Record) is created using persistent keys, a brand is able to orchestrate a personalised experience across an anonymous-to-known customer journey. Enriching the Golden Record over time enables deeper personalisation across every interaction.
Increasing purchase size and/or frequency using a Golden Record is another way for retailers to increase revenue. Knowing everything there is to know about a customer, a brand is primed to deliver the next-best action the moment a customer engages. Hyper-relevant offers that factor in a customer’s real-time journey maximise cross-sell and upsell opportunities; across every touchpoint, a brand delivers content that matters to the customer in the moment.
At the same time, a brand reduces negative behaviours, such as cart abandonment, by using context and cadence as cues for triggered events. Your next-best action is not the same for every customer who has abandoned a shopping cart, but rather intricately woven into the details of the abandonment within a particular customer journey.
Finally, retailers drive revenue growth through personalisation by increasing customer lifetime value. According to Gartner, a personalised CX drives 66 per cent of customer loyalty – more than price and brand combined. Hyper-relevant interactions or contextually personalised offers at the moment of engagement incentivise return visits and purchases by meeting customer expectations for knowing they’re the same customer across channels.
Driving revenue growth through personalisation is not to say that brands shouldn’t attempt to compete on price. It’s just that consumers are now making it very clear that price is not as important as a personalised, omnichannel experience. If the UK retail figures from the Office for National Statistics continue to trend upward, retailers will be wise to make competing on personalisation a top priority.
Vice President, Global Services, and General Manager EMEA