18 Jan 2023

How to improve customer loyalty & retention

Talon.One Writer

Content Team

how to improve customer loyalty retention

3 minutes to read

Retaining customers and acquiring new ones is essential to keeping your business running as usual, and both of these factors are hugely affected by your ability to tend to your customer's needs.  

To improve your overall customer experience, the most important thing to remember is your promotions have to be targeted, representative and relevant to your customers. 

This also means it’s very important to find out which customers are ‘high value’ and will be the most likely to spend their hard-earned cash with you.   

In this blog article, we’ll give you some great tips to set up your promotions in a way that improves customer satisfaction and brand loyalty. Look here if you want to know more about loyalty programs, features and all relevant definitions.

Coupon Personalization

Coupons can be used in a huge variety of ways. Everything from incentivizing the first purchase, rewarding your customers for any continued brand loyalty or quick and low-price customer appeasement.   

You can target much more effectively by setting unique-to-customer attributes as the validation criteria to receive or redeem coupons. 

A few basic examples are:  

  • Customer profile, device or payment ID 

  • Customer segmentation values (age, gender, average spend etc.)  

  • Geolocation (with Geofencing this process is simpler to define)

  • ‘Points’ earned (this could include badges, stamps, miles or any other type of loyalty system currency you have in place for your clients)  

Collecting this data from your customers is often a pain point in itself, and can cause people to feel suspicious of your intentions. 

But, you can overcome this obstacle by only ever using hashed-value IDs (hashids) for your customers, so their personal information is always protected. 

Discount Incentives

Like all your sales promotions, discounts need to be personalized so they feel relevant to your users. Data-driven discounts and notifications should be automated to react seamlessly to your user’s interactions with your platform. 

In this way, you can gently guide the purchase flow, provide a more relevant experience for your customers and display heart-warming success messages at every available opportunity.

A large part of the discount experience is the copy (text) you use in your notifications and the way you show them. You need to come up with a variety of funny, exciting or intriguing variations to ‘wow’ your users into deciding to make their purchase. 

Bundling Flexibility

The way you set up your product or service bundles should not only reflect typical buying trends, but also user-specific and seasonal deals that feel relevant to the time of year or where your customers are from. 

Discounts you give for bundling products should become larger the more items that are added and should also be personalized using profile-data attributes.

Also, free items, even if they’re excess stock are a great way to sway your customers and make them happier.  

Some basic examples of bundling best practices would include offering:

  • Similar items (to compare)

  • Related items (to complete the set) 

  • Items from the same or a similar series

  • Demographic-specific items (mostly for clothing or items you must be 18 to buy)

  • Profile-specific items (recent searches, similar items in your customer’s average spending range, items in colours your customer often chooses, and so on)    

The more personalized you can make a bundle (without making your customer feel like you’re spying on them) the better.      

Referral plans

In an ideal world, you won’t need to ask your users to refer your product, because it’s just that good. But, when you’re just starting out and you have a lack of resources, that ideal world is mostly just a dream.

So to start, make sure to reward both the advocate (your current customer) and their friend. With cash ideally (the people’s choice), but store credit and loyalty rewards work well too. 

Next, you have to make sure the whole sign up process is as friction-free as possible and the benefits of your product or service easily outweigh any negative experience your new customer has, filling in whichever forms. 

Straight after the sign-up, you should reward your new customer with credit or coupons and then show them how they can improve their lives enormously with your product or service. 

Loyalty programs

Here lies the key to improving your customer experience greatly.

A well-designed loyalty program needs to be more about noticing and rewarding valuable interactions, than about trying to convince clients to spend more constantly.

Using effective milestone rewards are a great way of gamifying your customers’ experience and showing that you care about them at all those crucial moments that they invest in your brand.

Your loyalty program should include at least some of the following:

  • Customer Wallets for collecting points, stamps, badges, currency or coupons

  • Business-relevant credit to collect 

  • Badges for achievements

  • Loyalty Tiers that unlock special features, content or higher value points

  • VIP Membership benefits

  • Wallet sub-ledgers so that you can offer different types of points that can only be spent where they were collected.

Again, make sure that any rewards you give your customers are tailored to the segment that they are in. Or even better, tailored specifically to their profile data.

So, in a nutshell…

Knowing who your audiences and current customers are, how they behave and what they like, without breaking data-privacy laws is a crucial part of the overall customer experience. 

For new customers, a friction-free and personalized user journey will help remove doubts about your brand or product. 

Then to keep users interested, a gamified loyalty program that rewards clients regularly, and encourages brand commitment.    

With the right software, you can create memorable experiences that people will tell their friends and family about. 

At Talon.One we developed an API that allows you to create all of the campaigns mentioned in this blog, with data-driven, targeted and easily scalable promotion tools in an intuitive user interface. 

If you'd like to learn what our Promotion Engine can do for your business then by all means, book a demo with us and we'll show you how you can set up your specific use cases in our Campaign Manager.

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Isabelle Watson

Loyalty & promotion expert at Talon.One

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