Data Drive Your Decision-Making Based On What Your Customers Are 'Telling' You

  • Written by  Mikkel Oldenburg, TARGIT

VP site only TARGIT head shotAccording to the Harvard Business Review, big box stores like Walmart are honing their skills when it comes to customer loyalty, in part by creating rewards programs that both reflect and promote their brand promises. This comes as no surprise, as customer loyalty is a key element of success in the crowded and complex retail industry. However, many are beginning to confuse loyalty with promotions, loyalty cards and awards, undermining brand equity rather than building stronger ties with their customers.

Why The Focus On Customer Loyalty?

Why is the focus on customer loyalty so vital, and equally as important as other key factors in the overall business process like an efficient supply chain and actively anticipating new trends?  Purely from a cost perspective, gaining a new customer is very expensive compared to keeping the existing ones, since increasing your customer base takes significant investment in marketing and special offers to get attention from new audiences. Even further, according to Forbes and Gartner Group, 80% of your future revenue will come from 20% of your current customers. Investing in your current customer base has huge payoff potential.

To stay top-of-mind with customers and ensure their happiness, there must be consistent communication through data-driven omnichannel marketing. Depending on the audience, that customer loyalty program could be rooted in social media engagement, direct mail, mobile apps, e-newsletters, loyalty clubs and advertising. Those activities, combined with the actual purchasing that's happening online and in brick and mortar stores, leaves an immense amount of data at the retailers’ fingertips.  

Refining The Approach To Customer Loyalty Through Data

Most organizations now understand how to utilize data to increase inventory efficiencies and assess the success of the supply chain through business intelligence programs. What many overlook, however, is just how impactful internal and external data can be on customer loyalty and marketing efforts. Data from the aforementioned customer loyalty programs, in combination with in-store and online purchase data, can be used to analyze customer insights and inform marketing campaigns that create deep-rooted customer relationships. Business Intelligence is paramount to outlining and following up on the most effective mission and strategy.

The best way to learn more about your customer is to think big, and then hone in on the specifics by segmenting your audience through demographic or social data. For example, is your primary audience working mothers, or sports-crazed fans? How old are they? Figuring out these questions from the start will help you speak their language and get in front of them in their daily lives.

Once the “perfect customer” is identified, you can begin pulling data from both internal and external sources that can even further inform your marketing touch points. Having all this data at your fingertips will allow you to react fast and precise if you see behavior changes and eliminate potential loss or even losing customers.  

By having multiple, smart touch points throughout several channels within your business strategy, marketers will see the following positive impacts on their efforts:

  • You’ll be where your customers are: Omnichannel marketing will increase the likelihood of your message reaching the target audience. In today's world of high stimulation and low attention spans, multiple meaningful interactions better ensure your message is absorbed by its intended audience at least once.

  • Your customers can become your friends: Gaining access to valuable customer data helps you get to know your customers better and provide them with products, deals and experiences they expect. When you provide relevant offers, you will ultimately get a better response.

  • Your revenue goals will soar: The more customer loyalty the company sees, the more likely it is that your sales will increase.

By implementing a direct communication to consumers rooted in data, retailers are setting up a win/win situation. Retailers stay visible in the most effective ways, and customers gain access to exclusive information, as one example, indirectly showing their commitment through purchases.

Real Business Impact

So how does all of this impact your business? Generating the right data about your customers leads to a greater understanding of who they are and what they want. It also helps you measure and quantify your efforts as a retailer. The more insight you have on your ideal customer, the better you're able to target those touch point campaigns. This knowledge helps better shape campaigns, such as targeted newsletters and discount opportunities.  And, fortunately, gathering and analyzing the data needed to create the perfect marketing campaign is the easiest of all with the right comprehensive BI solution. Not only will you gain insight into which campaigns were most popular, but you can drill down into clicks, locations, and resulting actions from those who interact with your brand.

To round out the perfect customer loyalty approach, your supply chain must be fully operational, ensuring you deliver a high-quality product that lives up to promises made in initial marketing efforts. Companies need to focus on their leading indicators versus their lagging indicators that show past results. To do this, be sure to include expected weather delays, logistical considerations, efficient returns, etc. A lack of visibility around inefficiencies makes it difficult, and sometimes impossible, to assist your customers well and give them the experience they have grown to expect from your brand.

The great challenge is to know to whom you’re marketing. Don’t limit yourself from the very beginning, but be open to what your data and marketing experiments show you. You may be surprised of who your true fans are. Once this is defined, it will be possible to dig into data to learn their most specific buying habits and expectations. Investment in retaining a loyal customer base will help you retain the lifeblood of your business. 


Mikkel Oldenburg is the Practice Manager, Retail and Service for TARGIT. He has been with the company since 2006 previously working as a Partner Account Manager. His focus has been specifically working with the hands-on implementation of the TARGIT Data Warehouse to allow customers more efficient data retrieval and performance reporting via SQL and TARGIT.

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