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Improve Conversion by Targeting Loyalty Segments

A loyalty-focused poster with varying rewards levels to enhance conversion rates.

Your customers come in many different shapes and sizes. It’s important to segment your marketing so you can serve up the right content at the right time. But, with just 22% of customers saying that they’re satisfied with the level of personalisation they receive, brands need to do a lot more to get their customers to convert. 

To improve your customer experience and encourage conversion, target your customers in ways that go beyond demographics.

With a loyalty program, you can segment your customers based on deeper insights (such as average order value, loyalty point balance and interactions completed). This data will help you reach out to your customers in new, engaging and highly targeted ways. 

This article takes a look at the three key customer segments you can extract from your loyalty data: VIP customers, at-risk customers and churned customers. It also suggests ways you can keep each of these customer types engaged and repurchasing from you long-term. 

Keeping your top customers engaged

So, who are your loyal customers? 

These are the ones who repurchase from you often and sit in the top 10% of your customer base. Their customer lifetime value is high, and their average order values are bigger than a regular customer. On average, these loyal customers spend 67% more than new ones. 

Not only do these customers spend more, but they’re also more engaged with your brand – they open your emails, follow you on social media and are active in your community. More often than not, these are the customers that become advocates of your brand and will recommend you to others.

With a substantial 86% of customers saying that they are more likely to repurchase from a brand again if they provide excellent customer experience, it’s important to make these customers feel valued.

Start by giving them extra perks for being a dedicated customer through your loyalty program.

For example, Annmarie Skin Care use their loyalty program to create a VIP community around their brand. Membership to their “Wild & Beautiful Collective” gives members a first look at new products and access to a private Facebook group where make-up lovers share beauty secrets. 

An approach like this will work to make your brand champions feel special. As a result, they’ll return to shop with you, and take every opportunity to tell others about your brand. 

Turn at-risk customers into an opportunity

Your at-risk customers are the ones who are reaching your lapse point and are close to leaving you to shop with your competition. They may not have repurchased from you within a particular time frame and they’re not engaging with your brand as often. 

To bring these customers back from the brink, send reward available emails as a reminder of the loyalty points they have acquired. You should also show them the products they can redeem those rewards against. 

On average, loyalty emails have a 35% higher click-through rate as they hold more value for the reader. Plus, with customer data at your disposal, you can personalise the content within these emails to entice more clicks and conversions. 

These emails could also include prompts that show customers the other ways they can earn points beyond spending – such as leaving a review or referring a friend. This way, they’ll be excited to return and engage with you. 

Your win-back approach

Just because a customer hasn’t purchased from you in a while doesn’t mean they’re gone for good. There are still ways you can bring these customers back to your site. 

Create a campaign that makes them feel like they’re discovering you for the first time.

You could use emails to show them what’s trending on your site since they last visited, and to show them the perks of your loyalty program that they may not have known about before.

Boody, a sustainable underwear brand, send their customers emails that make them feel welcomed into their brand community and shows them ways to earn more points. 

You should also work to surprise and delight these customers. With a tiered based loyalty program, you can move your lapsed customers into a higher or secret tier with more exclusive bonuses. By notifying them of the change to their account, they’ll be excited to return and engage with the new perks they have now unlocked. 

Also, use seasonal sales to excite these customers. Opportunities like Black Friday Cyber Monday are the perfect time to run flash-point events where customers earn double, or triple, points on their purchases. These eye-catching events will grab the attention of these (almost) lapsed shoppers and will make you stand out over the competition. 

Level-up your segmentation

Customer segmentation is nothing new. What can set you apart, however, is the way you use the loyalty data at your fingertips to target your customers in ways that encourages them to complete their purchase. To learn more about engaging your customer segments, visit the LoyaltyLion Academy – our free, educational resource

This article was originally published by our friends at Zaius.

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