This article by Bryan Pearson, in the latest edition of STOrai, highlights how retailers can use data to build lasting customer loyalty.

1. Outlook
Distinguishing the Customer Experience
through Customer Intimacy
How often do you think your customers, upon closing a transaction, leaving the store, or
visiting your web page, think, “Boy, that brand really understands me.” In fact, most
organizations do have the ability to do just that – to really understand their customers.
Technology is enabling brands to gather and decipher data at every moment, from the website
to the aisle to checkout to the call center. All of these actions provide a window into the needs
and aspirations of consumers. The question here is – if we have the means to gather such
information, do we really use it wisely? Bryan Pearson, president and chief executive officer of
LoyaltyOne shares his views.
T he highest level of building
customer relationship is all
about gathering information,
and then segmenting and deploying it
across the organization, including to
number of times a customer visits
you. Repeat business may simply be
the result of a variety of functions:
l o cat i o n , p r i c e o r s e l e c t i o n .
Emotional loyalty, however, is when a
satisfied customers, but that result in
engaged guests who have emotional
loyalty to your brand.
These three steps will upgrade your
front-line staff, that distinguishes a customer chooses to stay with your brand from customer-merely-
chain that simply follows a con- brand even when an equal or satisfied to customer happiness,
sumer's purchasing patterns from potentially better alternative is through intimacy.
one that actually knows the customer available. Define and Build Emotional Loyalty
intimately, and is willing to act on it. for Your Brand
Companies have the capability to
Simply put: Companies succeed (or analyze large amounts of data, If customer intimacy is the way to
fail) based on the satisfaction and segment customers by groups and foster greater guest commitment,
happiness of their customers create offers based on individual even in the face of competition, then
throughout the brand interaction. behavior. Likewise, they can use this loyalty, particularly emotional loyalty,
And the most effective way to ensure information to build a more relevant is the result of knowing what your
customer happiness is by delivering experience, and turn that customer best customers love about you and
experiences that are relevant. data into an engagement device. building on that.
Relevance in turn will lead to cus-
The challenge is in understanding A customer may say she is loyal to one
tomer intimacy and ultimately
how to use all of this wonderful data grocery chain because she stops by
emotional loyalty with the brand.
in ways that don't just create the on her way home from work. But in
But don't confuse loyalty with the exceptional experiences that deliver reality, she may only shop there
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2. Outlook
because it is on her daily commute. relevant to his preferred brand may
What if a new grocer, with wideraisles But don't confuse loyalty with change, to heart-healthy foods or a
and better service opened nearby? the number of times a seat on business class.
Chances are she would try it, and if customer visits you. Repeat
she preferred the price, service and Unfortunately, achieving relevance is
business may simply be the
selection, she would switch grocers. an increasingly daunting task. As
result of a variety of functions: channels of communication prolifer-
But let's say that same shopper has location, price or selection. ate and compete, the process of
established a relationship with her Emotional loyalty, however, is reaching the consumer is like
long-time grocer's employees, who when a customer chooses to whispering in a windstorm. The only
greet her by name. She also appreci- stay with your brand even messages that rise above the noise
ates that the employee who stocks are those that offer solutions to
when an equal or potentially
the aisles lets her know when certain specific customer needs – on a timely
items are on sale and that the cashier
better alternative is available. basis.
tells her about upcoming cooking
events. And she is impressed by the to build long-term, profitable Any enterprise vying for the
store's follow-up emails, which relationships. It occurs when you are consumer's time and interest is
recognize her purchases preferences able to understand your best custom- tasked with meeting the challenge of
in the forms of recipes and coupons. ers' core interests, assign value to relevant and resonant communica-
them, and then connect with them in tions so that they can be heard.
In short, her long-standing grocer a way that says, “I know who you are, People lead complex lives, after all,
chose to invest in the customers it and I understand your needs.” and engaging them effectively takes
already has, and to use its data- understanding them on multiple
insights to anticipate their needs and Many brands could afford to be more fronts: by location, timing and
to build more relevant experiences. creative and expand their recognition individual preferences.
options to meet the equally advanc-
When that new grocer opens nearby, ing or shifting lifestyles of their Use Your Guest Data Responsibly
this shopper chooses to stay with her customers. What if a regular Having such ground-level knowledge
older but more personalized chain. customer just had a serious health of your best customers requires
These actions all indicate emotional scare? Or perhaps a job promotion? advanced data processes, and great
loyalty, and to retain it, you need to Suddenly, the features that are most responsibility. It is pretty straightfor-
nurture this elevated level of brand
commitment.
Assure You Are Relevant to Your
Customers
Acquiring such commitment takes
more than the right products, prices
and location. To achieve emotional
loyalty, you need to resonate with
you customers through a differenti-
ated experience.
Relevance represents the most
powerful opportunity for companies
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3. Outlook
ward: When consumers share product to focusing first on the
personal information with you, they consumer. Limit the amount of data you
are entering into a value exchange, collect to only what you need,
This step, or in many cases this leap,
and they rightly expect something of use the data you collect only as
worth in return for the data they give occurs when everyone in the
directed and as is permissible,
you. If you are a hotel operator and company, from the executive suite to
the front desk, places the customer at and retain it only as long as
ask a guest if she prefers to sleep near
the center of their purpose, and view needed.
to or far from the elevator, then
provide her with the room she wants. their brand experience through the
consumer's eyes. This may seem like a And – it should go without
If one is not available, offer an
given in many service industries, saying – safeguard your
upgrade to one that is. This not only
will win the guest's admiration, but where the experience really is the customer data as if it is a
also expose her to the desired distinguishing factor. But for those corporate secret.
amenities of a suite and entice her to working in the sales aisle, the kitchen,
book one on her next trip. the stock room or even the call center, experiences for their customers and
the customer can seem pretty far build long term, emotional loyalty in
In short: If you expect your customers away. the process. They are all champions
to continue sharing information and of customer intimacy, and not all of
business with you, then you need to Bridging the gap takes the skillful
collection, analysis and segmentation them even operate loyalty programs.
give them something they value in But the ingredients to winning trust
return. of data, always in the context of the
consumer's lifestyle. Companies have and emotional loyalty are the same.
Also, be clear with your customers the resources to collect this kind of At the end of the day, their customers
about what information you are data. But to truly standout, they must are likely to say, “Boy, this company
collecting, why you are collecting it use the data in ways that enable and really understands me.”
and how you plan to use it. It's basic empower all workers, and incorpo-
relationship building: For consumers rate their guest insights throughout Bryan Pearson is president and chief
to trust you, you need to be honest the operations of the entire organiza- executive officer of LoyaltyOne and
with them. Limit the amount of data tion. author of The Loyalty Leap: Turning
you collect to only what you need, use Customer Information Into Customer
the data you collect only as directed With such comprehensive Intimacy.
and as is permissible, and retain it understanding of the consumer, we
only as long as needed. can develop not only the best services About LoyaltyOne – global leader on
or products, but also the most consumer insights & strategy, loyalty
And – it should go without saying – effective ways to connect with marketing and customer experience
safeguard your customer data as if it customers and present them with management. LoyaltyOne aims to
is a corporate secret. relevant offers based on their past transform the landscape of the Indian
activities. And we can do this not only loyalty industry by creating value
Building Experiences for a Happy through our direct communications, through customer centric marketing,
Customer but also through our frontline retail analytics, customer lifecycle
By mastering and combining these wo r ke rs w h o co m p l ete t h e management, data privacy and
principles, you have positioned your experience. usage.
company to make the most important
step it may ever face, one that will Think about it. Think about the
carry it from focusing first on the companies that create truly relevant
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