Learn how to leverage personalized promotions to increase repeat customers

Personalized Promotions: The secret sauce for repeat customers

Learn how you can leverage the power of personalized promotions to boost revenue growth, increase repeat customers and reduce churn.

a year ago
9 min read

If there are three things that most (if not all) businesses have realised post-pandemic, they've got to be:

  1. New user acquisition is a game of heavy burn and costs. Retention, on the other hand, is exactly where a brand finds the sweet spot of "continuous" growth. An increase in repeat customer count is way more cost effective, reduces churn and is definitely a win, both short and long-term.
  2. Customers today have a lot to choose from, however, they have also become very cautious about where they spend their money- making trust and loyalty the real deal.
  3. Knowing each customer, being relevant to them and targeting their unique needs is important now more than ever.

And a winning strategy to keep customers hooked to your business with an increase in engagement, customer satisfaction and revenue growth- PERSONALIZED PROMOTIONS!

Brands today are not just looking at acquiring new customers, instead, they want to offer more valuable, lasting experiences for existing customers — and driving revenue through repeat purchases.

In this blog, we explore how you can run promotions that keep your customers engaged at every touch-point, making them come back to you on repeat. We will also discuss strategies for understanding customer needs and preferences, and provide actionable tips on promotions to help you solve for churn, and boost revenue growth for your business.

How do personalized promotions lead to an increase in repeat customers ?

  1. Customers relate and so they engage: Messaging and promotions that are tailored to a customer's taste, preferences and interests are a lot more relatable, relevant and therefore, engaging. Sure, customers love promotions of all kinds but they only make the effort to engage with those that they resonate with. With personalized promotions, you get their attention, you make them feel valued, appreciated and seen - making it more likely for them to trust your brand and what it offers.
  2. Satisfied customers: By running promotions that are personalized, you can show your customers that you understand them and their preferences. This also plays a huge part in increasing their satisfaction with a brand and the likeliness of them to come back for purchasing more and recommending the brand to others.
  3. Revenue Growth: With promotions that are unique-to-user, you can encourage your customers to make additional purchases by offering incentives that are influential in their decision-making. A well-engaged customer has more chances of sticking with a brand and making regular, repeat purchases.
  4. Reduce Churn: Give customers a reason to NOT switch! Customers today are prioritizing trust and relationships with a brand before committing fully. Personalized promotions help build a unique, personal relationship with customers- making it "enough" reason for them to choose you over any other competitors.
"70% of consumers say that how well a company understands their individual needs impacts their loyalty" (Salesforce)

What attributes should you focus on to effectively personalize every customer touch-point?

There's a lot that customer data can tell you about their unique behaviours, likes/ dislikes, journeys, where they come from, what they are looking for, at what time are they most active etc.

83% of consumers are willing to share their data to create a more a personalized experience (Accenture)

Here are some ways to track user-information that will allow you to target the right customers, at the right time with the right incentives:

  1. Demographics: Such as age, gender, location, and income, etc., can help you understand who your customers are, where they come from and tailor your promotions to meet their specific needs accordingly.
  2. Behaviour: Tracking a customer's browsing history, tap-in rates, engagement and participation patterns, email open rates, social media reactions etc., can tell you a lot about what kind of messaging and products work to get a customer pay more attention to your brand.
  3. Purchase History: This one is a super-weapon! Drawing insights from what a customer has already purchased can equip you to help them with recommending products that compliment, product bundling, and future promotions. Personalizing promotions based on a customer's previous purchases, needs to draw their future-aspirations can help you to incentivise them with the right offers, on the right products/ services, at the right time - which can boost repeat/ additional purchases.
  4. Customer Interactions: They say a product/ service is great only if it really solves a core problem of a customer. This is where we suggest you keep a track of all customer interactions - be it complaints, feedback, reviews etc. That way you understand the common pain points and address them with the right incentives and give them a better experience overall!
  5. Channel Preferences: You don't want to run offers on a channel where your customers are not even active. Track, optimise and run exciting promotions on platforms that your customer prefer to engage on and increase the chances of their participation.
  6. Campaign Participation: Be it a loyalty program or a BOGO sale, you must actively track which campaigns have higher participation and why. By understanding a campaign's participation rate you can run effective promotions and save the time, money and effort on those which arent exciting enough! Campaign participation rates also help in evolving the campaign design and in deciding what promotions you want to build in the future.
  7. Purchase Frequency: Understanding and tracking how often your customers make their purchases can help you identify repeat purchase patterns. These learnings can be applied to develop promotions that encourage more repeat purchases from your customers.
  8. Product Preferences: The categories that a user prefers browsing through, searches for or purchases can help you tailor your promotions to give them better recommendations, or even run offers that convert to a sale!
  9. Average Order Value: A customer's average spend on your brand can help you identify who your repeat customers are. Your most valuable customers will be those who have a higher order value overall - your loyalists! Run promotions that are personalized to their specific needs to aim for an increase life-time value from your repeat buyers.
  10. Referral History: If your customers are referring your brand to their personal network - those customers are your advocates. To encourage your brand advocates to continue repeatedly refer, your promotions must focus on incentivizing them with the right rewards. Referral programs are not only great for increased customer retention and engagement, but are also saving you a lot of time, effort and money on acquisition.
  11. Preferred Device: Are your customers using a desktop, mobile or a table for most of their interactions with your brand? Optimize your promotions for the most-preferred device to mazimize the effectiveness of your campaigns.
  12. Preferred Time: Identify the time of the day when your customers are most receptive and create promotions that are timed to that.
  13. Abandoned Carts: Abandoned carts do not necessarily mean business lost. In fact, keeping track of abandoned carts can help you identify which products or categories may require more attention in terms of offers, discounts etc., which can help a customer make that purchase.
  14. Customer Feedback: Customer feedback is pure gold for personalization. Use what a customer tells you, and cater to their exact need. Using information that the customers themselves provide, you can offer promotions that lean towards their preferences, solve for their pain points and give them a satisfying experience overall.

Great, once you've identified the customer attributes that you want to track, you can create customer segments to run targeted/ personalized promotions that resonate with each segment. There is no limit to how many segments you would want to create and target for personalizing each touch-point with your customers.

For instance, demographic segmentation can used to create promotions that appeal to specific groups such as people under or over a certain age group, or gender, specific groups such as college students, parents etc.

Similarly, behavioral segmentation can be used to create promotions that target customers who have previous bought into your product/ service or those who are likely to make a purchase in the near future.

Another interesting way to identify a certain segment of customers is Psychographic segmentation. This takes into account the lifestyle, values, personality, and interests of your customers. For example, a business selling gym gear may segment their customers into those who are work-out enthusiasts.

Examples of Successful Segmentation Strategies

A. Amazon's personalized product recommendations- Only a few do this better than Amazon. Amazon understands a user's purchase history, browsing history, and product ratings to identify patterns and similarities between it's users. Based on this, Amazon recommends products that other users with similar interests have also purchased or shown an interest in.

Amazon personalizes its promotions and product recommendations to increase repeat customers and loyalty
Personalization Pioneer, Amazon, tailors it's product recommendations, messaging and home page journey based on what a user searched for previously, what a user has bought in the past and what user's with similarities would bundle. 

B. Spotify's tailored playlists and promotions: Based on a user's listening patterns, saved songs, searches etc., the platform suggests playlists or songs that a user is more likely to enjoy. For promotions, spotify tends to promote an artist's concert album if a user has previously listened to the artist's music many times over.

C. Sephora's targeted promotions based on purchase history and beauty preferences: Based on the products a customer has bought in the past, Sephora suggests other products that can compliment the purchase.

The ideal blend for every customer: Personalized experiences+ Incentives!

A common mistake that most brands end up making is that they run the same promotions for their entire user base, at a time that they want and with incentives that they prefer to offer. Now, we aren't particularly saying that there is anything wrong with deciding who to incentivise, when and with what, however, personalizing promotional campaigns using certain user attributes and segments is many times more effective and relevant.

The key is to create promotions that add value to every customer's experience, rather than running a generic marketing ploy. So, here are a few ways that you can start personalizing your user's experience at the most crucial touch-points and encourage repeat customers:

To encourage repeat purchases and engagement, Starbucks' reward program members can earn points for every purchase, they can easily track their reward balance and the rewards that they can readily redeem.
To encourage repeat purchase and engagement, Starbucks' reward members earn points for every purchase which can be used for free drinks and other benefits of the member's choice. Members can easily track their point balance and the rewards that they can redeem.
  1. Loyalty Programs: A solid loyalty program is reason enough for customers to commit to your brand. It has the power to influence the rate at which your customers shop with your brand on repeat, their relationship with your brand and their will to "explore" everything you offer. That said, personalization is that key ingredient of a loyalty program which maximises its effectiveness and potential. While most loyalty programs function around a generic reward structure, personalizing a loyalty program ensures that no customer feels left out or undervalued. Personalization can ensure that you reward the customer for their distinct behaviors- addressing their specific needs and rewarding the right actions.
  2. Email Marketing Campaigns: Email marketing goes a long way in keeping your customers engaged, informed and connected. But it isn't as surprising when customers simply never deep-dive into the content of the email or worse- they simply dont open it. Well, that's probably because most emails seem like mass forwards with generalised content.

    "70% of millennials are frustrated with brands sending irrelevant emails"

    However, using customer-specific data and information, brands can personalize their email campaigns and share relevant product recommendations, offers that are exclusive, or simply address the customer by name. Similarly, brands can set up automated emails on certain unique actions of a customer that reach them at the right time with the right incentive. An example of this can be when a customer abandons their cart, a prompt email with a discount on the cart can convince a purchase.
  3. Referral Programs: Personalization in a referral program plays a significant part at increasing the participation, engagement and the number of referrals made by each customer. It must also be noted that when a customer feels connected to a brand, the likeliness of them recommending the brand within their network is very high. By personalizing the referral program, you can reward the customer for one or more actions made in the favour of your campaign, delighting them at each step of the referral journey.
  4. Exclusive Discounts and Offers: When a brand identifies a specific behavior or interest of a customer - they can tailor their discounts and offers that directly attract a customer's attention. This increases the likeliness of repeat purchases made by a customer. A classic example of personalized offer can be when a customer gets a percentage slash on a product they frequently purchase.
  5. Product Recommendations and Bundles: Amazon does this best. Understanding a user's unique attributes and drawing similarities with other users at large can help brand recommend products. By tracking and analysing a customer's purchase history and behavior, brands can recommend products or create bundles that increase the likeliness of a purchase. Apt product recommendations or bundles are a great way to increase a customer's average order value.

    91% of consumers say they are more likely to shop with brands that provide offers and recommendations that are relevant to them.
  6. "Get-to-know-me" Content: Quizzes, surveys, feedback forms, customer queries or even social media DMs are a great way interact and learn about a customer's preferences and interests. Using this information you can stitch content and messaging that is more interactive for the customers, increasing their overall engagement and satisfaction with the brand. This data can further be used to design future promotions and marketing campaigns.

So, these were some tried-and-tested personalization strategies that you can incorporate in your promotions and build a loyal, repeat customer base. However, it's important to remain flexible, which means you must experiment, track and scale what works. By doing so, you can incentivize your customers with the right offers, at the right time, and through the right channels.

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Every user-interaction is a promotional opportunity. Unlock the power of personalized, high-impact promotions that boost growth, user engagement and retention - without any tech effort.