Understanding the Customer Journey Toward Brand Loyalty

How do customers become loyal? Is it possible to guide consumers toward loyalty and not just conversion? These are compelling questions for today’s brands and their hard-pressed marketing teams. The good news is that companies can use a customer data platform (CDP) to help answer both questions—this powerful tool is not only instrumental in understanding the customer journey but in building customer loyalty as well. Let’s take a closer look.

The Hidden Wealth of Loyalty

Loyal customers are even more valuable to brands than new customers. They try new products, spend more, and generate new leads by sharing their brand experience with others. Price Waterhouse Coopers’ Customer Loyalty Survey 2022 reveals that faithful customers express their loyalty in the following ways:

• 52% recommend their favorite brand to friends and family
• 48% participate in their brand’s loyalty program
• 22% subscribe to their brand’s products and services
• 12% engage with their favored brands on social media

In addition, 13% of loyal customers say they don’t consider price to be a significant factor when purchasing products or services from their favorite brand.

It’s clear that customer loyalty pays rich rewards to brands that earn it. But in order to enjoy its many benefits, brands need to know how to build intentional relationships with customers after conversion. The key is to understand the customer’s journey and the expectations that follow their first purchase.

Understanding the Customer Journey

First, what is the customer journey?

A typical customer journey can be characterized by 4 stages: awareness, engagement, conversion, and loyalty. Customers become aware of an existing product or service either through their own efforts, others’ recommendations, or a brand’s lead generation initiative. Prospective customers then begin to engage with intermediate touchpoints to see if the brand offers the solution they’re seeking. If all goes well, the customer converts by completing desired actions like purchasing an item or subscribing to a newsletter.

Many brands stop here, quickly forgetting converted customers as they focus on fresh leads. This is a gross miscalculation of the customer’s journey because many customers continue their journeys well beyond the point of conversion. Brands that nurture converted customers may enjoy the many benefits of loyalty behaviors like higher revenue from repeat purchases, increased lifetime value, and lead generation.

Investing time and effort to win new customers will always be an essential marketing concern but brands have much to gain by nurturing customer loyalty to maximize benefits.

Nurturing Customer Loyalty

Converted customers have a perspective different from fresh leads. Their first-hand experience with products and services has already educated them about a particular brand. Converted customers, therefore, have a new set of needs and expectations compared to the beginning of their journey. Continuing to target them with awareness-stage tactics risks losing relevance and connection altogether.

Brands can nurture customer loyalty by:

1.) Knowing customers’ journey stages

2.) Creating consistent experiences for loyal customers, and

3.) Rewarding loyalty

Know Your Loyal Customers

The first step is to know which customers have converted and progressed to the loyalty stage. This may sound simple enough, but it’s not easy to put into practice unless a brand has the right data and tracking capabilities. CDPs like Treasure Data Customer Data Cloud provide visibility into the customer journey so teams can segment audiences according to their current stages. Use Treasure Data Customer Data Cloud to:

Segment audiences. Treasure Data’s CDP creates unified customer profiles from data collected across all channels and touchpoints. Permanent customer profiles are updated with every action customers make like visiting a website, clicking an ad, or completing a purchase. This enables Treasure Data CDP to track customers in the loyalty stage and segment them for analysis or activation.

Analyze audiences. Once loyal customers have been properly segmented, teams can use Treasure Data’s machine learning (ML) techniques to analyze profiles and generate loyalty scores. Audience Studio further refines segments by specifying criteria based on high loyalty scores. Treasure Data CDP also analyzes audiences to identify VIP profiles, loyal customers who are likely to churn, and customers with the greatest lifetime value.

Build lookalike audiences. Knowing loyal customers also enables teams to target new customers based on similar characteristics. Using Treasure Data Customer Data Cloud, brands can determine a seed audience’s characteristics (e.g., location, behavior, or age) to build a lookalike audience for precise targeting. This approach increases the chance of prospects not only converting but becoming loyal repeat customers throughout their journeys.

Create Consistent Experience for Loyal Customers

Once loyal customers have been identified, brands can proceed to craft the right experiences for their specific segment. Treasure Data CDP helps teams create a personalized experience for loyal customers on a consistent basis across channels and touchpoints. Nurture loyalty through:

The right message – Send loyal customers the right message that suits their journey stage. With Treasure Data Customer Data Cloud, teams can exclude converted customers from early-stage messaging, campaigns, and promotions. Instead, target loyal customers with post-conversion initiatives like an invitation to a loyalty program or a referral rewards system. Treasure Data Customer Data Cloud seamlessly connects with martech apps and systems for hassle-free execution of personalized campaigns and communications.

The right action – Use Treasure Data CDP to create unique post-conversion journeys for customers. Treasure Data’s Next-best Action (NBA) system calculates the action with the highest chance of success based on customer behavior and audience insights. Select the appropriate next step like connecting buyers to a support agent or directing them to a product resource after completing a purchase. Fine-tune recommendations and suggest relevant cross-sell/upsell offers to converted customers.

The right place and time – Because loyal customers have already generated historical and behavioral data in previous interactions, brands have more raw material to enrich analyses. Use Treasure Data’s ML techniques to analyze loyal customers’ engagement patterns, decision points, areas of friction, and others. Teams can apply these insights to select the right time and place for engagement or use insights to improve customer journeys for similar audiences and fast-track them to the loyalty stage.

Reward Loyalty

Loyal customers may not remain loyal forever. Retain customers by staying relevant to their current needs and rewarding loyalty behaviors. Below are several ways to nurture loyalty:

Offer post-purchase value. Customers naturally value brands that consistently provide good value beyond the initial purchase. Retain converted customers by offering loyalty perks, incentives, discounts, and rewards. Treasure Data Customer Data Cloud continually tracks behavior so teams can align loyalty initiatives to customers’ expectations. Teams can also use Treasure Data CDP to discover which incentives drive advocacy among loyal members to further increase lead generation.

Choose the right rewards. Treasure Data Customer Data Cloud uncovers consumer insights to inform brands what kind of reward best suits a specific audience. For example, a group of customers may prefer transactional rewards such as loyalty points or discounts in exchange for referring friends and family. Another group may choose an experiential reward like access to an exclusive event or entry to a contest in exchange for sharing brand content on social media. These audience insights arise from customer behavior, engagement, content consumption, and other data points captured by Treasure Data CDP and analyzed by AI and ML techniques.

Keep learning about loyal customers. Treasure Data CDP continuously updates customer profiles with every interaction. Teams can use this data to keep refining experiences for loyal customers. Treasure Data CDP also enables brands to run A/B tests and optimize campaigns so teams know what works best with specific audiences. This not only improves journeys for loyal customers but also serves lookalike audiences.