Emarsys Loyalty Index

CIPR members receive 5 CPD points and PRCA members receive 10 CPD points for listening to this podcast if they log it on the CPD programme.

In our second episode to be produced in partnership with the Customer Engagement Platform Emarsys, part of SAP, we discussed the findings of the Emarsys Loyalty Index, which analysed responses from 7000 consumers that Emarsys surveyed across the US, UK, France, Germany and Australia.

Russell Goldsmith welcomed back to the podcast from Emarsys, Payal Hindocha, Director of Customer Engagement Solutions GTM and joining them online was a panel of retail experts from North America. Firstly, in New York was Carol Schuster, Business Information and Technology Adviser from the global lifestyle brand Lafayette 148 New York. Next from Montreal, Canada, was Angelo Rubino, Vice President of Rubino Shoes. And then finally from Chicago was Jason Goldberg, Chief Commerce Strategy Officer at Publicis Communications and co-host of top e-commerce podcast, The Jason and Scot Show.

Headline Findings

Payal began by explaining that Emarsys has over 1,500 clients globally with a vast majority in online retail and multi-channel retail space. They specialize in delivering personalized communications across all digital, physical and service channels to really help their clients build customer loyalty and create those long-lasting relationships with the customers.

One of the reasons why they produced the Loyalty Index was that there’s so much buzz around loyalty and loyalty programs right now in the industry. Payal said that it’s always been a slightly controversial topic on whether loyalty programs work or not and how to measure the success of loyalty. What does a brand want to achieve from loyalty and what does that actually mean for a customer?

She said that when it comes to loyalty, it helps businesses achieve what everyone wants to achieve, which is more customers buying more often at higher values and lower costs. Across the Emarsys client base, whether these brands have a loyalty program or not, each of them are able to use insights from their customer product and sales data to better understand their existing customer base and personalize those communications with context and relevance for each customer. All these personalized communications are based on their past behavior. What their predicted spend and lifetime value is net of the returns, what their product affinity and what type of customer they are. If they’re a first-time buyer, an active customer, a loyal customer who’s been buying from the brand for a long time, but not necessarily part of their loyalty program, but also what level of discount and reward they’re accustomed to or sensitive to. All of these elements that make up these personalized communications are tailored towards selling value and benefit to the customer so that a brand can progressively build their engagement with that customer and ultimately their lifetime value by encouraging behaviour that drives a profitable outcome, but also rewards that customer for their engagement with that brand.

The Loyalty Index found that over 67% of customers consider themselves loyal to a brand, whether they’re part of a loyalty program or not and these frequent personalized communications is also what’s driving different types of loyalty in customers:

1. Incentivised Loyalty – through discount, incentives, and rewards.
2. Inherited Loyalty – built through the association with other brands – typical examples are brands which sell through department stores where the loyalty lies with the department store or alternatively with that brand itself.
3. Silent Loyalty – without advocacy, which a customer who can buy from brands and retailers that would not publicly endorse that brand, but also disagree with some of their ethics.
4. Ethical Loyalty – built through a strong emotional connection that customers have with the brand. The findings showed almost 41% of customers are ethically loyal to a brand due to the great personalized service that they offer.
5. True Loyalty – where a customer is loyal to a brand they know, they love and they trust and have that previous history with them.

All of these different types of customer loyalty are a result of a personalized engagement and communication that brand have with the customer.

Rubino Shoes

Angelo explained that Rubino Shoes is a family business retailer in Canada, based in the French speaking territory of Quebec. The company has been around for thirty-five years. He said he was basically born in the company – his father started it. They have 30 brick and mortar large retail stores and sell 100% branded footwear including eclectic brands such as Nike, Converse, Vans and also, as he described, a little more dressier brands, such as like Michael Kors. They do not have a private label. They also have an online store and so sell across Canada.

Angelo said that the Rubino has Inherited Loyalty from its customers because of the brands that they sell. For example, customers come to Rubino and buy only Nike shoes or Converse. They are therefore working with Emarsys to be able to send their customers personalized communication with regards to those brands. Angelo also believes that have Ethical Loyalty. He said that what’s really big right now is companies that have a culture, a mission and a purpose, which is what Rubino Shoes do. He said that through the pandemic, we’ve seen a lot of people returning to their local stores, shopping local. They’ve been avoiding some of the mass retailers that sell online and going back to the little local shops. With Rubino Shoes based in suburban areas, they’ve seen a lot of families go back in store and try to really encourage the local economy. Rubino Shoes therefore try to give back locally. They try to help foundations that are local in Montreal, Quebec.

Lafayette 148 New York

Carol explained that Lafayette 148 is a women’s lifestyle fashion brand, founded in New York, ergo the name. The company is twenty-five years young. They are vertically integrated, making all their own clothes. Carol said that they were actually a manufacturer that became a brand, which she felt was very unusual in this industry. She said that they are very much multichannel. They started out as a wholesaler but are now primarily direct to consumer. They have 17 brick and mortar stores in the United States with 17 brick and mortar stores in China, wholly owned. They also have a very robust e-commerce catalogue business. During the pandemic, they started a direct sales model leveraging independent stylist’s network across the United States and they are about to move into Canada. The company was founded by women for women, so they are very much a purpose driven company as well and pride themselves on the fact that they really deliver quality and craftsmanship, which Carol added is critical, and the ultimate in service. She said that’s really what their customers are looking for, especially at their price point.

What does it take to drive loyalty to a particular brand or store?

Jason was fascinated by Payal’s research. The thing he runs into most often is that it turns out humans are super complicated beings, and their decision making is quite complicated. He thinks the same person can exhibit all five forms of loyalty that the Emarsys study uncovered, and the challenge is how you appeal to them simultaneously or have the right context to know which trigger is relevant to a particular point. He said that he might be quite ethically loyal to his food brands but may have an inherited loyalty to his apparel brand, for example. He therefore feels it’s important to be aware and cognizant of all of those biases. But when you put it in practice in the world, we maybe need to find a way to ascertain the specific triggers for a specific customer and then deliver something that’s contextually relevant to her.

Payal agreed.  She said that correlation between progressively building the engagement with a customer and ensuring they’re rewarded and felt valued by that brand is why customers keep coming back to these brands again and again. She added that there’s a wide variety of reasons why customers stay loyal and why they keep going back to a brand. One of the biggest reasons is actually tied back to the frequent personalized communications that they receive and the content that’s in there. The Emarsys study showed that a wide selection of products that are relevant to customers, the discounts and promotions which are tailored based on the behaviours and past purchases and what they’re actually rewarded for, is what’s driving that loyalty. She said that one of the measures of success of having loyalty strategies, is how customers show their loyalty towards a brand. According to the research, 66% percent of consumers showed the loyalty and the frequency of purchases that they make with 48% saying that the positive experiences led them to recommend others to a brand. So, the more a customer buys from a brand in terms of all the value and frequency of purchase, the higher their lifetime value is and the more profitable they are to business. She said that it’s almost like a virtual circle, bringing all of these different types of loyalty together and progressively building that relationship and engagement with an existing customer and personalizing that communication drives that frequency of purchase and order value up. And when customers have that positive experience, they’re rewarded for the purchases and their loyalty and then they refer others. So, they refer friends and family to that brand and referrals are a great low-cost acquisition method. It’s also based on third party data. So, through this virtual circle, you have more customers buying more often at higher value and lower cost. And in each stage of the circle, you’re progressively building up that engagement with a customer to build that loyalty.

Angelo said that this resonated so much with him and his company.  He feels like the number one thing is servicing his customers, especially in a pandemic when e-commerce was booming. Most of his competitors had a very hard time delivering. The number one thing was making the product available. People were working from home, so they were looking for athleisure apparel, athletic shoes. Rubino Shoes had the stock, and we were delivering really fast and ultimately, they service the families. He thinks that’s how you build a strong loyalty with your client base – keeping it simple, delivering it really fast, personalized communication.  He added that word of mouth was so amazing for them. People were saying, “Order from Rubino. I got my shoes the next day”. He said that social media was also crazy. People were asking how they were doing it? But Angelo said the truth was they all rolled up their sleeves and went to their warehouse and were all shipping orders, a thousand, two thousand orders a day. They had stopped all traditional marketing including a billboard campaign that was supposed to come out and fliers through the mail. Their marketing budget was zero dollars. They didn’t know if the company was going to go to a hundred or to zero. Fortunately, 2020 was a record year because of the moves that they made. He said that Emarsys became so important to them as they needed to personalize their communication.

Carol said that their customers have true loyalty. They have customers who just absolutely love them and have been with them since the very beginning. She thinks the consistency of quality, fit, craftsmanship and then that high level of customer service is really what has retained them. Even during the pandemic. They had customers come and buy in their stores and when they reopened again in July, they came in just to buy something because they wanted to see them do well. She added that they were very careful about messaging during the pandemic in the sense that they were considerate of what was going on in their customers’ lives. They kept driving email and that more personalized approach. They built a direct sales model, which is a stylist network who deal directly with the customers. They also built out their customer experience team to take on some of the individual customers one by one. Carol thinks there’s a there’s real opportunity to continue to drive loyalty, particularly in difficult times as you tend to stand out if you do it really, really well.

Carol explained that her company doesn’t have an incentivized loyalty program. They do have their markdown cadence during the year and times where they start to mark down a discount. They also run a Mother’s Day event last year, which did very well and was almost like a gift that came in the mail while everyone was in lockdown. She thinks people really appreciated that because they were able to apply a substantial amount of money against a purchase and she learned a lot through that. But generally speaking, they do not have an incentivised reward program. They incentivised in the fact that they provide excellent service, quality and fit. They even go to the extent that if somebody would send them a jacket that they bought 10 years ago and it had a rip in it, they will fix it for them and send it back, or if they’re missing a button, they will replace it. The company can do this because they are vertically integrated and so have everything at their fingertips, and therefore do things that other brands don’t do. Carol said that is really what’s tied their customers to them for so many years.

In answering whether too many retailers rely on incentivize loyalty programs, Jason said that it’s tricky because an inconvenient truth about price and incentive is they work in the short term as they entice behavior. However, he added that the problem is they almost never are a good investment in the long term. Therefore, if you’re a marketer and you’re just looking at the return on ad spend for a particular campaign or for a particular promotion, it’s absolutely true. You can get more customers by offering a discount, but you very likely are doing permanent damage to your brand and eroding the potential lifetime value you can earn from those customers. He said that Walmart has been very disciplined about consistently being an everyday low-priced retailer, and that model has been very successful for them. Whenever a retailer starts offering promotions, it’s almost impossible to go back to being an everyday low-priced retailer. So, it’s a slippery slope.  He said that it is a tool in the basket, but it needs to be used very sparingly and carefully.

Payal said that when a brand has a loyalty program, they’re looking for different ways to build customer loyalty. She said that service is a key element to that and that it’s quite clear to see that launching a loyalty program is just another tactic that supports and complements a loyalty strategy, and whatever that loyal strategy may be for that brand, but it’s complementary to build a loyal customer base. She said that there’s a very big difference between a customer who’s not part of a loyalty program, but has a high lifetime value, a high propensity to buy and high protected spend, and has been a loyal customer for years versus a new customer who has just joined the loyalty program just to get the perks of a discount on the first purchase and then never shop with that brand again, which she said complements what Jason was saying on the return on ad spend. Payal said that when a loyalty program is disconnected from your existing customer base, where they’re already immensely valuable loyal customers, it’s very difficult to make that loyalty program a success because it’s just another project to you that’s not remotely connected to or even consolidated to what else you’re doing to either your existing customer base or to your product recommendations or to what you’re doing in the channel and a marketing execution and the lifecycle marketing mix. She thinks in the case of Carol and even Angelo, when they are ready to launch a loyalty program, just having this connected to their overall marketing strategy and their overall tech stack, they already have all the insights they have on that customer base and that following that link to the marketing execution that allows them to make this a success. On Jason point about incentivised loyalty, Payal said that incentivised loyalty is typically brands that launch a loyalty program to reward their customers with points, prizes, experiences, and build a tiered approach to building their profile in the loyalty program. This could be across any sector, but more so in the fashion and beauty categories, where from the Emarsys Loyalty Index, they have seen over 60% of customers build their loyalty within loyalty programs because of different rewards such as exclusive access to a wider product range or earning and redeeming rewards with points or access to member only discounts and even invites to VIP experiences. But Payal added that a loyalty program is just one tactic within an overall loyalty strategy to be able to drive that lifetime value up.

Jason said that one of the first questions he always asks, whenever someone talks about implementing a loyalty program, is defining what loyalty means for that brand or that retailer, because there are so many goals. To some people loyalty is having a higher NPS score or to some as having a higher share of wallet, to some spending twice as much next year as you did this year. It might even be sharing the brand on social media, but specifically around the incentive. So, the trick here is generally humans are not good at long term paybacks. We all struggle to pay for life insurance that doesn’t have some benefit until the distant future. And in the same way, incentive-based loyalty programs that have very big rewards that are hard to earn don’t tend to work very well because consumers don’t like to wait a long time to get the reward. But then conversely, if it’s a reward that’s easy to earn and therefore it is likely less valuable, that tends to have less of an impact on behavior. So, striking that balance of having some long-term incentive while rewarding people frequently earlier is an endemic challenge in these points-based loyalty programs. Jason argues that those kind of programs at the moment are waning in popularity. There are some very successful ones. But across the board, we’re seeing them implemented less than they once were.

How can brands achieve true loyalty?

Carol said that theirbusiness was predominantly wholesale driven for many, many years up until recently, and Covid was really the pivot point. They pivoted to becoming a direct to consumer (D2C) brand overnight, going from 65% wholesale to now 65% D2C. She thinks that what’s really continues to drive their loyalty with their consumers – building that personal relationship, frequency of communication and continuing to build that personalized service, which she said is really what differentiates them and is what’s actually driving their D2C growth. They are continuing to invest in those areas as well in a way that they hadn’t done historically because they came from a manufacturer mindset and became a wholesaler. But when you really step up and own up to being a D2C brand, there are a whole new set of skills and capabilities that need to come to the forefront. Driving consumer demand is very different than being on the supply end. Carol said that they are very excited about a lot of the work that they have been doing in terms of building storefronts, building out their service offering and continuing to build and invest in their brand.

Angelo said that Rubino Shoe’s is way more mass market, and their typical clients are women between age of twenty-five to forty-four. So, they don’t want to be another loyalty program, another card in their wallet. It’s instead about finding ways to reward their customers’ loyalty and keeping it really simple and honest – he said their customers are family. They’ll come back either way because we have four seasons in Quebec. So, they’ll come back for ‘back to school’ and for their winter boots for their kids. They are returning customers. It’s just finding ways of how you can thank them for their loyalty and make it fun and simple.

Jason said that to him, like loyalty is much more than just a points program and increasingly a points program almost is certainly not the way you want to go for loyalty. He said Patagonia, which has one of the strongest loyalty and highest NPS scores among outdoor apparel brands, doesn’t have a membership program or a points program, but owners of their apparel know that Patagonia will stand behind its product. If the zipper breaks 10 years down the road, they’ll replace it. And so, they lean heavily into that ethical loyalty element. Every holiday around Thanksgiving, they run a famous campaign called ‘Don’t buy this jacket’. ‘No one needs a jacket this expensive. You already have a good jacket. If it needs to be repaired, bring it in and we’ll fix it. If you’re tired of it, bring it in and we’ll trade it with someone else’. Jason said those kinds of campaigns engender true deep loyalty with the brand, even though they’re not tied to any form of program, which he thinks is very smart and ultimately financially lucrative.

Inherited loyalty

Jason said that in some ways, inherited loyalty might be the oldest. He felt we could debate whether that’s a form of loyalty or a fundamental brand affinity and used Chanel as an example.  He said that a lot of fans of Chanel love Chanel because of what it says about them, that they own Chanel. And there are millions of consumers that are loyal to Chanel that don’t own any Chanel. He therefore thinks that’s a form of inherited loyalty, which is one of the fundamental tenets of building a great brand – creating that association that consumers want to have with a brand. He thinks Apple is another version of that.

Recreating physical loyalty into online loyalty

Payal thinks that even with the growth in e-commerce, there’s been a bit of a shift in how consumers use different, digital channels. Mobile apps and mobile first experiences are becoming just as relevant now because they’re a customer’s preferred method of engagement. But majority of retail sales still happen in physical stores globally. She said that only 195 still happen online. However, Payal thinks both online sales and physical store sales now are facilitated by mobile apps and mobile channels, where over 60% of discovery to purchase journeys are started on a mobile device. So, when it’s building that customer loyalty around e-commerce or stores, she thinks it’s really about how you make that experience and that frequency of personalized communication relevant and contextual, wherever that customer is, wherever that customer wants to be across any of those channels. So, whether a customer’s visiting a store, whether they’re on a website, whether they on engaging with an SMS or even downloading a mobile app, it’s about making that experience easy to earn and redeem the loyalty or rewards, whether that’s online via mobile app, or via in-store. It’s also about making it easy for them to then refer others based on their positive experience, because that’s clearly what people want to do these days. Payal doesn’t think we should look at it as a siloed channel approach, but rather holistically how it’s all coming together and how you use the data from all of these channels to be able to really understand that customer and personalize the communications going forward.

Carol said that Lafayette 148had a pretty robust e-commerce business for many years, which started it in 2006 and what saved them during the pandemic. They did see a big shift towards e-commerce during this time. Carol also thinks that convenience is a luxury now. We’re all seeing the flexibility we have from working from home and so whilst customers still want to go to the store, they’re going to want to go to the store more for an experience. The ease of buying that additional pair of pants online while you’re sitting at your computer at nine o’clock at night after dinner and you’ve put the kids to bed in a way is also a luxury, but it’s just a convenient one. So, Carol thinks it is about really understanding how their customer wants to shop, when she wants to shop and being there for her and meeting her at all those different times and making yourself available and also understanding what her needs are – in Lafayette 148’s case, it’s her wear occasions and being able to provide the product that fits her changing lifestyle. Carol said that in this omnichannel world, we don’t have any choice but to meet her or him, where they are and really be able to deliver on all points, all touch points.

Angelo said that Canada was already behind the USA with regards with online shoppers and online shopping. So, their business was 90% in-store sales. However, they have seen a 10x growth on their online sales and when the stores started reopening, what they realized was that people were going back to stores but also continued shopping online. There was a lot of pre-shopping made online and then people visiting stores. They have now implemented something called BOPIS – buy online pickup in store. People were looking for convenience and so he wanted to see how to make it easier and effortless for their customers to walk in and out and making sure that the size was available. The customer usually pre-shops online and then pick up in-store.

Angelo said that they ry to stay connected with their customers by sending personalized emails and he thinks the general experience was good. The pandemic forced them to improve their online processes. They had to do free shipping and free returns and follow the leaders on this online world. They had to adapt or die and that’s what they did and so right now, he said they have a very strong online presence. They were able to turn around very quickly and ship the next date, which are things that people are looking for when they shop online. But Angelo said that the value they we have is because they have 30 stores right across Quebec, so people buy online, and they can easily return to one of their brick-and-mortar stores to exchange the size. People are looking for that kind of convenience.

How important is a brand’s purpose to the loyalty of its customers?

Jason said that purpose driven brands and purpose driven marketing is a double-edged sword. He firstly pointed out that while there clearly is true loyalty to brands that have an authentic mission that’s aligned with their consumers, it’s difficult to measure. He said the Emarsys study, for example, was a stated preference survey. It asked consumers how much they weighted something, and those consumers answered with their rational mind. However, he said about 97% of all our shopping decisions are made with our irrational mind or the subconscious part of us. The rational part of us is always going to say that we’re interested in brands that are aligned with the mission. But then when we go to the grocery store and our lizard brain wants the sugar-coated cereal, that is not organically grown and has no GMO in it, it turns out we still buy the sugar-coated cereal. So, he would be a little careful about just assuming because consumers say that they’re motivated by their missions that they are. That being said, they sometimes really are. And the key thing there is it’s only worth appealing to that consumer if you can do so in an authentic way. If you’re having a meeting and saying, how do we reach consumers? Oh, consumers care about this cause. So, we’re going to run a marketing campaign about that cause. Stop. You shouldn’t do that. If you want a market based on having a cause, you better have had that cause before you started the company, because in the modern era, where transparency is so predominant, if you don’t really live your mission or you don’t really live your brand, you’re going to be found out. And the damage to your brand is irreparable. Jason cited a famous apparel brand, a digitally native brand that built their business based on this sort of mission driven customer called Eveline. Jason said they famously had transparent features on their website that were wonderful, but  it came to light they weren’t very nice to their employees and that they weren’t necessarily always living that mission that appeared in their marketing. The brand equity was significantly eroded when it was discovered that they were potentially inauthentic.

Angelo agreed.  He believes in company culture and that you’ve got to have strong values.  He said one of the values at Rubino Shoes is authenticity.  They never try to surf a wave of campaigns, such as Black Lives Matters. He said they saw companies blacking out their pages and saying black life matters. Angelo believes that black life matters, but they didn’t post about it just to follow or surf on a trend. People asked him  me, why Rubino wasn’t taking a stand and he said it was because they are not just going to do it and surf on it. He thinks people are going to see what you are actually doing for your community and explained that Rubino are actually based in the east end of Montreal, where it’s a very diversified community. Therefore, rather than saying it on a post or on a statement or surfing on the waves and on trend of LGBTQ, gender diversity, sustainability, they get involved in their community and talk about what they actually are doing. He said that that’s how you stay genuine.

Payal said that the research showed 23% of consumers stay loyal to their favourite brands due to a strong emotional connection. But she agreed with Jason and Angelo in that what people buy versus what they say and then what they do is different. So, data driven decisions is the way marketing should go forward. Looking at the data, how you bring that data together and then how you act on that and when there’s a certain theme, when there’s something happening in the community, it’s about having that agility to be able to maybe have a softer approach to the tone. But it’s down to supporting your core value proposition of that brand. And it’s really down to making data driven decisions to really act upon the data rather than what people are saying, see what they’re buying, what they’re doing and act upon that. Carol agreed and said it really does come down to what do you stand for and being really true to your core and not veering off of that because the consumer will smell that a mile away. It’s so important to be clear about what your mission and your values are and stay true to it and really live them. That will be the best expression of who you are. You don’t have to ride the coattails of some particular event. She thinks that’s true for any brand.

Emarsys case studies

Payal then shared some examples of clients they are working with, starting witha lifestyle fitness brand who doesn’t have a loyalty program, but are building a loyalty community that is core to their strategy. She explained that they are looking at the data sources and the data sets of their customers engaging via many different marketing channels. They’ve connected those data into insights to understand who that customer is, what they engage with, what kind of discounts and offers and promotions they are most sensitive to. So, they’re really making data driven decisions and they’re engaging with their existing customer base, using the data from multiple channels, and using AI and machine learning and predictive analytics to be able to build that loyal community. She said that something like this doesn’t happen overnight. It’s about how do you take a new customer? How do you get them to come back to your brand? How do you engage with them even at a time when they were not ready to buy something? This lifestyle and fitness brand is actually now classified as a tech unicorn, they recently IPO’d and are one of the biggest brands in Europe now.

Similarly, she said Emarsys have another health and nutrition brand who, again, don’t have a loyalty program. They are a consumer product brand who have really seen a very big shift in the D2C sales versus the wholesale sales and are predominantly going D2C. They’re not ready to launch a loyalty program. But again, they’re using predictive analytics and really understanding their customers’ affinity to different products and how they’re sensitive to different type of messages to get them to engage even further.

The third example are a multichannel sports brand, who have a loyalty program as well as a loyal community and loyal strategy. The way they see their loyalty program is just one element of what they’re trying to achieve to engage and build the relationship with their customers. By default, any new customer that comes to their brand, they sign up for a loyalty program and it’s not that they sign up for a loyalty program straight away, but they nurture them and they engage them and they use all the different data points to personalize for them first.

All three of these examples will be discussed at Retail Revival.

Jason said that the version of loyalty that’s winning and working is helping people live a better life, making their life easier, saving them time and enabling them to live better versus saving money or earning points, for example. He went back to Carol’s example of having remote stylists helping the customer find their best wardrobe, or Angelo’s examples of providing more robust omni channel features. He added that in the pandemic, curb side pickup became the most dominant form of e-commerce of all times!   He said that on twitter recently, a big advocate for Nordstrom was talking about Nordstrom, tweeting that they have the greatest customer service company ever. They have a super liberal return policy, a wonderful piano player in each store, and they send a handwritten card on your birthday. They have fabulous customer service, whereas Amazon has horrific customer service, who you can’t call or talk to, being completely impersonal. Jason said that while all those observations are true, the majority of consumers rate Amazon as having better customer service than Nordstrom. And that wouldn’t have been true 10 years ago. But today, because Amazon is much more likely to have the product you want when you want it and get it to you the next day, that’s the new definition of customer service. It’s evolved over time. And in the same way, he thinks loyalty is continuing to evolve over time.

Measuring Loyalty

Jason believes almost everyone does a really poor job at measuring loyalty. He said you need to start with what your goal is, why you want loyalty. And then how you’re going to measure that. But the real answer and in the increasingly popular answer is you need some flavour of customer lifetime value, LTV or CLV. And increasingly, brands are implementing measurements that do measure customer lifetime value. And through that lens, you can make really smart decisions about the impact of all of these various loyalty tactics. But all too often, brands will say, I want a loyalty program and I want it to increase customer lifetime value, but then they’ll measure it based on the last click conversion of the last email they sent, which is an inaccurate way to measure these long-term customer elements. So therefore, Jason believes it is LTV for the win.

Angelo agreed. He’sseen people that have never ordered on Rubinoshoes.com. And since the pandemic, they’ve placed eight different orders. So that to tells him that’s a loyal customer rather than a click through on an email. He said it comes down to customer service and how fast he can deliver. He has seen a lot of products are sold out to some of the retailers, but they have a hard time sourcing them. He believes to build strong loyalty you have the product, deliver it fast and make it a very effortless for the customer and simple.

Carol said they do measure lifetime value, and they are old enough now so that helps tremendously. Then the question is, what do you do with that data and how do you mine that information in order to continue to nurture those high value customers who have demonstrated loyalty to you for a really long time? She said they look at retention and that they have very high retention levels. She agreed with Jason that in the short term, you look at clickthrough, you look at your UPC units per transaction, your average order value, all those things to help you achieve your budget for the year. But it’s really about lifetime value. And what drives lifetime value is really delivering, as Angelo said, an excellent product, excellent service time and time again, and really being able to repeat that every day of the week, 365 days a year. That’s the secret sauce to loyalty.

Emarsys Retail Revival

Payal said that if you’d like to learn more from some of the pioneering thought leaders on industry trends or learn from best practices from her clients and how they’re delivering exceptional customer experience and service that really drives loyalty, please register, and join Emarsys at their conference at Retailrevival.emarsys.com