Deriving the Value of Discounts, Referrals, and Loyalty Through Insights-led Engagement

Referrals at Talon.One

Marketing

Oct 4, 2022

Falguni Jain, Partner Content Manager for EU and NA at MoEngage

Falguni Jain

Partner Content Manager for EU and NA, MoEngage

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7 minutes to read

With easy access to information and multiple brand alternatives at their fingertips, the new generation of customers can easily shift their purchases from one brand to another. 

But studies show that 72% of customers are more likely to be loyal to a brand if they offer a personalized experience with additional rewards and benefits. 

The global loyalty management market is expected to surpass US$24 billion USD by the end of 2029, and there will be even more competition in the market than ever before. Unless your approach to customer engagement and loyalty is unique, survival will be tough. 

There is a pressing need to break through the clutter and connect with your customers in a way that gives value to them. This is why using insights-led engagement is essential.  

The Three Pillars of Insights 

Data helps you understand your customers better. But knowing which insights to use is a foundational step to successful customer engagement.

Here are the three types of insights modern marketers need, to understand their customers holistically:

Insights marketers need

Customer Attributes: 

To understand your customers’ attributes, behaviors, and preferences. 

  • Preferred product/content category

  • Preferred communication channels

  • Best time to send communication

  • Customer segments most likely to purchase

  • Segments most likely to go dormant

  • Segments most likely to churn

  • Most price-sensitive segments and those who love discounts

  • Most loyal segments and those likely to give referrals

  • Demographic data 

Journey Insights: 

To understand what your customers’ journeys on your platform look like.

  • How different customer segments are navigating inside your website/app

  • Moments and paths leading to conversions for different segments

  • Moments and paths leading to drop-offs for different segments

  • Moments and paths leading to churns for different segments

  • Which segments are not converting and why

Campaign Insights: 

To understand how your customers respond to your campaigns and communication.

  • Long-term impact of customers engaged with your campaigns 

  • Customer segments that actively engage with a specific campaign

  • Segments that don’t actively engage with a specific campaign

  • Campaigns that lead to the most churn

  • Campaigns that lead to the most revenue 

  • Campaigns with the highest interaction 

  • Most viewed content 

  • Impact of A/B tests on revenue, engagement, and retention

Once you know the insights you want to pull from, you must segment your customers based on the data you have about them.

Leveraging Insights to Create Deeper Segments 

Customer segmentation is critical for establishing which customers you need to engage with and how.

But since traditional segmentation methods are limited by incorrectly weighted factors and pre-existing biases, using more deeper ways to segment is a better approach. These include segmentation based on affinity, behavior, purchase path, and RFM segmentation.

RFM in particular accounts for the “Recency (R), Frequency (F), and Monetary (M) value” of each customer to generate valuable insights. Hence it is one of the best ways to understand where customers are in their purchase journey, their willingness to purchase, and eventually their CLV.

RFM modelling, recency, frequency, monetary

Customers who show similar behavior on R, F, and M scores and RFM aggregate scores, are grouped into the same RFM segments. 

customer segments from RFM modellingImplementing Insights-led Engagement 

Based on the customer segments, you can tailor your engagement strategies such as the following:

Champions: 

These customers have visited your website/app most recently, visit most often, and spend the highest. They promote your products and can be early adopters of your new launches. 

Recommended Engagement Strategies

  • Invite them to exclusive product launches.

  • Send them free samples. 

  • Reward them with membership points, gifts, free shipping, and other benefits. 


Loyal Customers: 

These customers have visited recently, visit often, and spend a large amount. They are highly responsive to your promotions. 

Recommended Engagement Strategies

  • Upsell by suggesting higher-value products to them. 

  • Leverage them for reviews and referrals by offering membership points or discounts per successful referral or after they have left a review.  


Can’t Lose Them: 

These customers have spent a significant amount on your website/app and have visited you many times.

Recommended Engagement Strategies

  • Listen to their feedback, suggest newer products, and make them stick to your platform. 

  • Send birthday gifts, early access to your products, free samples, and free shipping to keep them hooked.

  • Also, offer them priority support for any issues. 


Potential Loyalists: 

These are recent customers who spent a good amount with your brand and have the chance of becoming your loyal customers. 

Recommended Engagement Strategies

  • Engage them with long-term offers like loyalty programs or membership rewards.

  • Cross-sell by suggesting other categories of products to them, based on their search and purchase history. 


Recent Users: 

These customers have visited most recently, but do not visit often, and have not spent much.

Recommended Engagement Strategies

  • Make their onboarding experience smooth and provide assistance when needed.

  • Offer them a discount for every new product category they purchase and free shipping, to convert their purchases into a habit. 


Promising Customers: 

These customers have average recency, frequency, and monetary scores but the potential to buy more, and more often. You need to convert them into loyal customers.

Recommended Engagement Strategies

  • Create brand awareness by sending relevant messaging across all the channels they use.

  • Give them free trials/samples.


Price Sensitive: 

These customers have visited you the most recently, and also visit you often, but have not spent much. This indicates purchase hesitancy based on price and that they are looking for the best deals. 

Recommended Engagement Strategies

  • Recommend them value-for-money products.

  • Send discount-related communication frequently to re-engage them.  


Needs Attention: 

These customers have spent a good amount with your brand but a long time ago and haven’t visited recently. You need to bring back these customers. 

Recommended Engagement Strategies

  • Provide limited-period offers.

  • Give them product recommendations based on their purchase history.


About to Sleep: 

These customers have below-average recency, frequency, and monetary scores, and are about to disappear. You need to reactivate them as soon as possible. 

Recommended Engagement Strategies

  • Recommend popular products and provide membership discounts. 

  • Create “FOMO” through your messaging across the channels they typically use.  


Hibernating: 

These are customers whose last visit was a long time back and who have not spent much on your website/app.

Recommended Engagement Strategies

  • Recommend relevant products and provide personalised offers based on purchase history.

  • Communicate more often with them during the periods these customers are most active with your brand.


Lost: 

These customers have the lowest recency, frequency, and monetary scores.

Recommended Engagement Strategies

  • Make your presence felt through unique campaigns and try to win them back.  

  • Create “FOMO” through your messaging across the channels they typically used. 

  • Try to re-engage them with content or products they engaged with in the past.


A New Era of Customer Engagement 

We’re in the digital age of engagement, and customers can navigate their own buyer journey like never before. To stay ahead of your competitors and ensure customer retention you need to slice and dice your data into insights and craft bespoke customer engagement strategies. 

Fortunately for you, an AI-based customer engagement platform like MoEngage can enable you to segment your data, derive insights, and truly personalise your approach to customer engagement. 

To know more about the current landscape of insights-led engagement, check out The State of Insights-led Engagement Report 2022 | Europe Edition.


Author Bio: Falguni is the Partner Content Manager for EU and NA at MoEngage. She is passionate about writing various types of content, from epigrams and micropoetry to long-form B2B thought leadership articles. Having spent her life living in different parts of the world, she is always fascinated with travelling, meeting new people, and learning about their cultures.

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