Is Personalization Relevant in Loyalty Marketing?

Everything you need to know about personalisation and how to communicate with your customer base on a 1-1 level

People buy from people, as the old adage goes. Where brands connect with their audiences in a personable manner, trust starts to develop—and where there’s trust, there’s loyalty. Small businesses can thrive from personal connection, so how do you keep that sense of personal connection central to your brand when scaling your business or operating at scale?

The key is to talk and sell to people. Your customers are individuals with personalities, not simply passers-by to your site. Your audience members have quirks, likes and dislikes, and unique interests and emotions. Neglecting approaches that make customers feel special as you grow will result in marketing noise that is neither interesting nor helpful, and ultimately— creates drops in engagement.

Personalization and the ability to communicate with your customer base on a 1-1 level is highly desired by marketing teams. Building trust by demonstrating to those customers that you know and understand them individually is a potent method of driving value from existing customers and offsetting acquisition costs. This personal connection in a human relationship is called empathy, and that’s what is meant by customer-centric marketing. But how can we be sure that the personalization we’re chasing is aligned with what customers want and will ultimately nurture loyalty? Furthermore, is it a level of personalization that your organization is set up to deliver?

The Importance of Data

Retail, leisure, and travel loyalty programs have made the use of data commonly understood. The public is aware that data is being used and understand the value exchange of sharing this with companies. The main question is whether they value the use of personalization highly enough to see it as a fair exchange.

It’s not enough to simply include a name or make a relevant comment about something that affects 99% of your database. Relentlessly following visitors around showing them ads about products they browsed, but didn’t buy, is more likely to make your customer uneasy and distracted than to drive them back to purchase. Telling your customer that it’s been 12 months since they last ordered with you is only valuable if they need a reminder for health or financial reasons. But before you do that, in the name of personalization, ask yourself whether you are doing it to help your customer, or because it is the only option with your current personalization capabilities.

Using a general behavioral average to drive a customer-centric approach is more likely to get it wrong for individual customers than right. The goal, for any brand, should be to become so much a part of making your customers’ lives easier that they rely on you to guide them, share ideas with them, remind them, and direct them in their selections. What do you know about the pain points of your customer, and how are you solving them? Put your data and insight into action to improve the experience your customer has with you—then tell them about it.

Spotlight on Delivery

Delivery, for example, is a highly emotive stage of the journey that is so often treated as purely operational. Little empathy is ever shown when communicating delivery, yet most customer service teams will tell you this is a huge part of their contact.

Businesses run different delivery options and incentivize them from time to time. These incentives are marketed to everyone, because every potential customer needs to know about them, right? Wrong.

Think about whether that message is of value to the recipient. Have they ever used that particular delivery method before? Is the offer in line with their previous spend? Did they order recently and use that delivery service at full price? From the business’s angle, think about whether this offer will positively impact their regularity, returns, or shopping cart items that are about to expire. Have they ended a session recently at checkout stage, or is their historical spend and regularity otherwise in line with the offer criteria?

A Shift in Personalization Perspective

There is actually plenty of opportunity to personalize the delivery stage of the journey and build loyalty. Parting with cash, entering card details, and taking in important information results in stressed customers. They may need their goods quickly and so will pay whatever it takes, or they can wait for their goods to arrive but resent a delivery fee—there’s little in between. Think what it would feel like to regularly shop with a brand and never get an offer on the delivery method you use, but see that they always upgrade others’ deliveries. Imagine using a brand for the first time, paying for next day delivery to get the item, and then being offered free overnight delivery the day after placing your order.

The reason delivery is relevant to personalization is that most businesses can do this without having to create an industry around the personalization itself. Consider personalization more in terms of how to make your customers’ lives better, rather than exclusively thinking about how to get different visuals into 500,000 emails.

Personalization technology is based on the understanding that without any degree of personalization, the customer experience is poorer, less useful, less valuable, and with no differentiation to boot. Ask yourself whether the personalization is telling your customer something they don’t already know, sharing something with them they might like, and building trust in your brand—the ‘know, like, trust’ checklist.

Your offer doesn’t have to check all these boxes all the time, but at least one should always be true. Among the best examples I’ve seen was a guaranteed Saturday morning delivery—a premium option. This offer did not go out to everyone, but was personalized and targeted to regular overnight delivery users whose profiles reflect a low return rate and regular purchase pattern, making the delivery perk commercially viable and a point of difference.

The point here is that you don’t need to overinvest in technology to personalize. Think about it more as showing empathy. It’s a simple equation: “Because (as a brand) we know it’s hard when (insert pain point), we have (insert solution) and want you to be (insert incentive or reward).”

Of course, there are other examples where you might need more technology, but make it valuable. Include parcel tracking links on promotional emails for ease, ‘remind me later’ options on sale launch communications, prompts to renew subscriptions ahead of expiry, and advice and articles for session abandoners on high-ticket items. These steps will turn your brand into the one they can rely on.

Relationship as a Constant Goal

There is no textbook in personalization theory that’ll work for everyone. Many of the benefits are for the customer but this should not be a bad thing, we are nurturing relationships. However, it’s fair to expect a commercial payback… and the good news is, your ROI is just around the corner.

By delivering improved experiences for your customer, loyalty improves, and in turn, so does data and performance. The use of data and creative resources to deliver personalized communications are often barriers, but as you start out, personalization doesn’t have to be public-facing. Unique send times improve the likelihood of being seen, opened, and clicked. Channel preferences based on visit history deliver ‘behind the scenes’ personalization and predictive modelling to drive margin growth, manage stock, and tactically pull forward and push back visits and orders.

These methods are not something the customer will be overtly aware of based on their recall of behaviors, but they do create a perception of your brand always being there at the right time, showing customers the right content and reminding them of what they need. That’s the start of a very loyal friendship.

For more from PostFunnel on Loyalty, check out The Loyalty Series