As the battle of e-commerce brands continues to rage on, acquiring new customers has become more challenging, complex, and costly than ever.
In fact, thanks in part to the pandemic-induced surge in consumer demand and the privacy-first implications of Apple’s iOS 14+ drops, competing for consumer attention has led to a staggering 50% bump in Customer Acquisition Costs (CACs) over the past five years.
However, your new customer acquisition only impacts your business’ bottom line so much, because at the end of the day, brands need those shoppers to stick around for the long haul to make bigger, more frequent purchases–and beat competitors from poaching them before they do so.
Enter customer loyalty.
Best-in-class customer service, consistently high-quality products, a positive brand reputation, and seamless shopping experiences are instrumental to boosting customer loyalty. However, they’re oftentimes not enough, with the average U.S. brand losing 15% of its customers to competitors each year.
And, with 75% of consumers admitting they favor brands that offer rewards, the customer loyalty programs that help brands serve them up are proving to be a critical piece to the marketing puzzle.
Naturally, the number of available customer loyalty programs–which are essentially opt-in subscriptions for exclusive rewards, discounts, and other special incentives in return for a customer’s loyalty–has been skyrocketing, in-line with the interest from brands looking to implement the right customer loyalty platform for their business goals and audience wants.
Additionally, as they continue to rise in popularity, so too do the available platforms that allow brands to deliver them, as well as the innovative ways to incentivize customers beyond your standard points systems and discounts.
On the heels of MuteSix’s recent 2021 Yotpo Partner Award win for Best Digital Marketing Agency in North America, we wanted to take the opportunity to celebrate the importance of loyalty–not only between brands and customers, but brands and the customer loyalty platforms they leverage to build it.
Customer loyalty is the ongoing positive connection a brand builds and nurtures over time with its customers. Though much less costly to retain new customers than to acquire them (which can cost around 7x more), no matter how renowned your brand is or how premium your products are, turning one-time shoppers into brand loyalists is no-doubt more complex.
That’s because there’s an emotional component to customer loyalty, which can be hard to achieve in the digital-first, fast-transaction world in which consumers now shop. Each day, consumers are inundated with countless ads and offers compelling enough to stop thumbs in their scrolling tracks and get fingers to click “add to cart”–without so much as a single human interaction.
For brands looking to humanize today’s more impersonal customer journey and prevent shoppers from jumping ship after an initial purchase, they need to invest time and effort into making their most valued customers actually feel–well, valued.
Nurturing customer-brand relationships is critical to building loyalty and can be achieved via marketing efforts across all major channels. In particular, brands that leverage more 1:1 channels like email and SMS are finding the most success, thanks to these channels’ unique ability to personalize the customer experience via robust segmentation, automated email flows, and personalization capabilities.
In simplest terms: Robust relationships lead to higher rates of retention, which ultimately maximize revenue–for the long haul. So much so that, according to a study cited by Harvard Business School, increasing customer retention rates by just 5% boosts revenue up to 95%.
Turning one-time shoppers into loyal customers is essential, considering that–while they only make up 20% of a brand’s audience, customer loyalists spend 67% more on products and services than new customers–which can translate to 80% of your revenue.
Customer loyalty has the power to boost Visits, Average Order Volume, Conversion Rates, and Customer Lifetime Value (LTV), which are all critical components of the MuteSix Digital Disruptor Formula for Success: (V x CVR X AOV) + LTV = Revenue.
So, while implementing a best-in-class customer loyalty program can be pricey, it’s well worth the investment for brands new or old or big or small across all shopping verticals.
Customer loyalty programs are hardly a new phenomenon. They’ve been converting one-time shoppers into brand loyalists, while evolving their tactics to do so, since as far back as the 1700s, when brands handed out copper token for purchases to incentivize future ones.
However, in-line with the dramatic e-commerce boom and ensuing brand competition over the past several years, such programs have grown in popularity–so much so that 72% of U.S. adult consumers belong to at least one customer loyalty program, with the average loyalist subscribing to nine.
Naturally, as the customer appetite for loyalty programs grows, so too has the number of customer loyalty programs available for brands looking to unlock their profitable potential–as have their offerings to gain an edge on competing platforms.
No longer is customer loyalty simply about “spend and get,” where customers feel valued based on how much they spend. Instead, best-in-class customer loyalty platforms turn to customer data and feedback to craft incentives that align best with their audiences across all consumer touch points and throughout the customer journey. And platforms are getting more and more innovative with their offerings–not just limiting themselves to out-of-the-box rewards, reviews, and referrals, but customizing solutions based on each brand’s business needs.
As such, brands looking to partner with the customer loyalty provider that can cater to their unique business goals and different audiences have to weed through a sea of contenders. While there is no one-size-fits-all customer rewards solution or written-in-stone relationship, brands that carefully select the right one and establish an ongoing, synergetic relationship with their customer loyalty program of choice are finding tremendous success.
At MuteSix, we pride ourselves on connecting our valued brands with best-in-class customer rewards and loyalty program platforms, such as Yotpo, LoyaltyLion, ReferralCandy, Friendbuy, Stamped, and more.
Each leading customer rewards provider has its own unique benefits and key differences, but all have a proven track record of driving success for brands looking to jumpstart or double down on their customer loyalty marketing efforts.
When introducing the best-suited customer loyalty program to each of our valued clients, MuteSix carefully considers a few key factors about the customer loyalty platform, the brand, and its customer base. These include:
Overall, when looking for the right customer rewards and loyalty program provider, it’s important that brands consider the entire process–from ideation to implementation and test different options so as to find the platform that not only helps your brand grow, but grows with it. Because once your customer loyalty members boom, so too will your business and its need to scale accordingly.
When determining which customer loyalty program would be the right fit for Noémie, a fine jewelry label of 18K pieces uniquely and beautifully crafted at a fraction of the cost, there was no question Yotpo– the leader in the most advanced and customized solutions for customer reviews, loyalty, referrals–was the perfect match based on the jewelry line’s unique business goals and needs.
A deluxe luxury brand, Noémie typically shies away from traditional promotions that have a tendency to “cheapen” brands, and as such didn’t want a rewards program that blasted slashed prices to loyalty members–tactics that do not align with the “luxe” appeal of their brand.
As such, Noémie, the recent adopters Loyalty & Referrals, were eager to find the right discount-free solution.
While Yotpo’s out-of-the-box solutions were not ideal for this particular client, the MuteSix X Yotpo partnership spurred a more customized solution: Rewards for the type of review (the more UGC, the more points). With this content, the brand could then collect and repurpose UGC reviews in order to unlock the power of social proof, meaning such videos would influence the purchasing decisions of prospective buyers based on the opinions of past ones.
With this custom-crafted solution, Noémie went from low-converting text reviews to high-converting UGC reviews from their high volume of newly acquired loyalty customers in just a few short months.
Since the launch of the Loyalty Program in August 2021, the program has proven so successful that 57% of all orders on the brand’s website are from customer loyalty members.
Thanks to the Yotpo x MuteSix x Noémie award-winning partnership, Yotpo’s integration has proven wildly successful in boosting conversion rates and AOV for the jewelry brand. In total, this partnership has garnered the following results:
As a result of the MuteSix x Yotpo x Noémie synergy, out-of-the-box-thinking, and hands-on partnership, Noémie is now eager to explore other innovative Yotpo solutions for their brand, including the opportunity for loyalty customers to donate their points to a charity of their choosing.
Whether your brand is big or small / new or old, your greatest asset will always be your customers.
And, if you want to keep your hard-earned shoppers, you need to keep them happy.
Unfortunately, no matter how advanced your targeting, segmenting, or level of personalization is across your Paid Media advertising solutions, it’s challenging to speak to every single one of your customers on a personal basis and make them feel valued and understood enough to come back for more frequent, more expensive purchases.
However, when you find the right customer loyalty provider to create a loyalty program that’s true to your business needs and customer wants–you’ll find those one-time shoppers will remain true to you in return.