How to Retain Your Profitable Customers Using Data Driven Marketing
Data driven marketing can help you with customer retention. Because your most profitable customers generate a large portion of your revenues, it’s important to keep them happy. By identifying those customers, you can focus some of your marketing investment on retaining them.
For example, businesses use customer rewards cards as a way to retain customers. Businesses from grocery stores to coffee shops have customer rewards programs. These programs tend to involve issuing a card that accumulates points toward discounts or free products.
Often these cards let those businesses to track purchases at the customer level. What would otherwise be an anonymous cash purchase is tracked back to the customer via a swipe of the loyalty card.
You don’t necessarily need to give stuff away or provide discounts. Sometimes pampering your best customers is very effective. Loyalty programs that provide differentiated service to your best customers can be just as effective, if not more so, than financial rewards. Some theme parks offer early entry to season pass holders, for example. Department stores open their doors early to customers in their loyalty programs.
These so called surprise and delight strategies differentiate service and other benefits without discounting. This approach is quickly becoming a popular and effective way for marketers to reward loyal customers without cutting into already narrow profit margins. It’s also an effective customer retention strategy since it gives new customers an incentive to become more loyal.