The Importance of Prioritizing High(er) Value Customers

JoshMeyer

April 10, 2018

Blog_TheImportanceofPrioritizingHigher
One of those areas is customer prioritization. As with most industries, the 80-20 rule applies to the world of retail; high-value customers make up a large percentage of most brands’ sales. High-value customers are labeled as such for a reason — they can be huge drivers for your bottom line, and your CX efforts should be tailored accordingly. That means it’s critical to analyze your customer base for not only your best customers but also for those with potential to become a best customer in the future. Potential is important to consider along with current worth — high(er) value comes from both areas.
As you look to shift your investments to better serve your current and potential best customers, here are a few best practices to keep in mind.
 
Solve pain points that have the highest impact
Pairing analytical techniques such as potential value models with customer experience solutions will allow you to get the most bang for your buck in enhancing the customer experience. In this way, you are unlocking the value of your future best customers and not just the ones spending the most today. For example, if your data shows a pain point affecting only 20 percent of customers, you would need to look at the composition of this customer group (with specific attention to best and potential best customers) to understand the impact of solving this pain point.
 
Foster loyalty of your best and next-best customers through personalization
The LoyaltyOne report found that 76 percent of customers felt that receiving personalized discount offers based on their purchase history was important. Unfortunately, retailers aren’t keeping pace with their execution of individualized offers. Just 38 percent said they currently give customers personalized offers or promotions via their company’s mobile app and less than half (48 percent) reported that they engage with customers via email during the pre-purchase phase. Consider a more personalized approach to product offers and communication for not only your best customers but also your highest-potential ones.
 
Continue the relationship post-purchase and don’t forget to measure
Your relationship with customers should continue well beyond the point of purchase, yet this seems to be an area where retailers place less focus than they should. Customer listening is crucial to improving the shopper experience, but just 42 percent of retailers reported that they collect customer feedback based on the shopper experience. Loyalty programs offer an excellent chance to solicit feedback and gain insight on the areas that can benefit most from improvements. Your survey data and other metrics from your loyalty program should be used to measure the impact of your personalized offers. Introducing personalization into your post-purchase interactions with your highest potential customers will get you the best results and maximum ROI.
 
Current and potential high-value customers have a major impact on your business’s bottom line; today and into the future. Start making improvements to their CX today by understanding who those shoppers are; listening to their feedback and implementing changes that will make them feel that their business is truly important to you. 
If you’re interested in learning more about how retailers’ CX strategies are resonating with customers, be sure to check out LoyaltyOne’s entire report: https://www.loyalty.com/home/insights/article-details/cx-intention-vs.-impact-making-sense-of-the-ever-evolving-retail.
 

Customer Experience

Customer Analytics

Grocery

Food & Beverage

Retail

CX

Food Retail

About the author

JoshMeyer

Josh Meyer

Associate Director, Global Solutions

As Associate Director, Josh is responsible for leading client engagements and strategic partnerships within the Global Solutions consulting practice. Josh brings expertise in loyalty program design, financial & economic model development and international loyalty trends to drive loyalty innovation and positive returns for clients across the globe. Josh also leads the Knowledge Development team at LoyaltyOne to deliver industry, competitive and innovation best practices to the organization.

Josh brings extensive knowledge of coalition loyalty having worked with Dotz (the largest coalition in Brazil) and a number of other coalition partnerships during his tenure at LoyaltyOne. He holds an Honors Business Administration from the Richard Ivey School of business.

The Importance of Prioritizing High(er) Value Customers

Aug 28, 2018, 12:45 PM
One of those areas is customer prioritization...
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Publication date : Apr 10, 2018, 04:00 AM
One of those areas is customer prioritization. As with most industries, the 80-20 rule applies to the world of retail; high-value customers make up a large percentage of most brands’ sales. High-value customers are labeled as such for a reason — they can be huge drivers for your bottom line, and your CX efforts should be tailored accordingly. That means it’s critical to analyze your customer base for not only your best customers but also for those with potential to become a best customer in the future. Potential is important to consider along with current worth — high(er) value comes from both areas.
As you look to shift your investments to better serve your current and potential best customers, here are a few best practices to keep in mind.
 
Solve pain points that have the highest impact
Pairing analytical techniques such as potential value models with customer experience solutions will allow you to get the most bang for your buck in enhancing the customer experience. In this way, you are unlocking the value of your future best customers and not just the ones spending the most today. For example, if your data shows a pain point affecting only 20 percent of customers, you would need to look at the composition of this customer group (with specific attention to best and potential best customers) to understand the impact of solving this pain point.
 
Foster loyalty of your best and next-best customers through personalization
The LoyaltyOne report found that 76 percent of customers felt that receiving personalized discount offers based on their purchase history was important. Unfortunately, retailers aren’t keeping pace with their execution of individualized offers. Just 38 percent said they currently give customers personalized offers or promotions via their company’s mobile app and less than half (48 percent) reported that they engage with customers via email during the pre-purchase phase. Consider a more personalized approach to product offers and communication for not only your best customers but also your highest-potential ones.
 
Continue the relationship post-purchase and don’t forget to measure
Your relationship with customers should continue well beyond the point of purchase, yet this seems to be an area where retailers place less focus than they should. Customer listening is crucial to improving the shopper experience, but just 42 percent of retailers reported that they collect customer feedback based on the shopper experience. Loyalty programs offer an excellent chance to solicit feedback and gain insight on the areas that can benefit most from improvements. Your survey data and other metrics from your loyalty program should be used to measure the impact of your personalized offers. Introducing personalization into your post-purchase interactions with your highest potential customers will get you the best results and maximum ROI.
 
Current and potential high-value customers have a major impact on your business’s bottom line; today and into the future. Start making improvements to their CX today by understanding who those shoppers are; listening to their feedback and implementing changes that will make them feel that their business is truly important to you. 
If you’re interested in learning more about how retailers’ CX strategies are resonating with customers, be sure to check out LoyaltyOne’s entire report: https://www.loyalty.com/home/insights/article-details/cx-intention-vs.-impact-making-sense-of-the-ever-evolving-retail.
 
Tags :
  • Customer Analytics
  • Customer Experience
  • CX
  • Food & Beverage
  • Food Retail
  • Grocery
  • Retail
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Author : Josh Meyer
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