In Perspective: How to get customers into a loyalty loop

Sarah Curran Usher

The search for the right garment or shoe often starts with a question, rather than going straight to blue jeans or black shoes. “I like what this influencer is wearing but I’ve never heard of that brand before, what else do they sell?”; or, “I like these shoes, I wonder how the sizing runs?” And it is typical for the questions to pile up until the customer is so confused that they either buy the wrong item or give up altogether.

It is a point of friction right at the start of the journey that is not always considered because the job of getting the potential buyer there in the first place, through advertising and remarketing, has already been done and most of the acquisition costs already spent.

In a world of limited choice, this would not necessarily be a problem because the customer has no option but to commit to what is available, but despite the strictures of Covid over the last year, consumers have never had a more choice of product or channels through which to buy. And as the mainstream social channels move ever more closely to ecommerce, even well-known brands will have to re-evaluate their reach.

Customers are trying more new brands than ever

Assumptions about loyalty will also have to change. During the pandemic, more consumers than ever tried new products and may well stick with them longer term. McKinsey found in its survey that 75% of consumers tried a new shopping behaviour in response to economic pressures, store closings, and changing priorities, while 36% tried a new product brand and 25% tried a new private-label brand. Of the consumers who tried different brands, 73% said they intended to continue to incorporate the new brands into their routine. Of all the switchers, Gen Z and high earners were most prone; two demographics that are strategically valuable for retailers in the long term, both in terms of building cohorts of younger loyal shoppers who will turn to brand advocates of the future and those whose average spend will be naturally higher.

The keys to loyalty, or more usefully customer lifetime value, are the same as they have always been, recency, frequency and monetary value – but too many assumptions are made about how the customer will act in the many blind spots that still exist between one step in the buying journey and another. A customer that is presumed to be loyal should actually not be having to do as much work to get what they want as a casual browser.

And of all the points of friction that brands can fix in that journey from browse to delivery, helping the customer find what they want right at the start so they have a positive brand experience and do not need to return it is the biggest. Helping shoppers find only what they love begins in the beginning of the journey.

Customers shouldn’t be doing all the work

Consumers spend a large and wearying proportion of their shopping journey just trying to get the item that is right for them. Of all the reasons they are prepared to give a brand their loyalty, feeling that they are known, valued and understood by the brand are critical.

Leveraging connected shopper data to understand who your customers are and what they shop for, even beyond your brand, not only engenders loyalty, it also cuts the brand’s costs – by knowing it only needs to market what that customer wants, retailers get clearer insights into product performance, which helps cut the costs associated with discounting and returns.

What does personalisation look like? It’s knowing the styles, fits, materials that each customer gravitates towards and showing them products that tie to their personal preferences. It’s enabling customers to understand their best fit or size in products, and giving them relevant replacement suggestions if an item is out of stock in their size, or better yet, only showing them the items that meet their style and fit preferences and are in stock.

There is no shortage of stats to prove this; 36% of consumers say retailers need to do more to offer personalised experiences (Retail TouchPoints); 91% of consumers say they are more likely to shop with brands that provide offers and recommendations that are relevant to them (Accenture); and, 80% of consumers are more likely to make a purchase from a brand that provides personalised experiences (Epsilon).

Looping customers in

For brands, the main role of loyalty should be data capture and connection, used in a trustworthy way to cater each journey. True Fit’s Fashion Genome uses machine learning to analyse customer purchases to understand what their individual preferences are, by item and across baskets. This reveals insights every bit as accurate as fashion industry forecasters and helps brands take control of their assortment and ranging before each season.

A real benefit at this level means that brands are only carrying what stock it knows its customers want, doing away with the need for constant second guessing of demand forecasting, which all too often leads to too early promotions and markdowns that ebb away at already squeezed margins.

The objective is to create what we call a loyalty loop where the customers keep on getting what they need at every stage – discovery, purchase, service – which makes it easy – and enjoyable – for them to keep returning time after time.

Sarah Curran Usher is managing director EMEA at True Fit.

Listen to our recent In Detail podcast with Sarah Curran Usher here.