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Customer Loyalty in Retail: It’s All About Getting to Know Your Audience

By Kim Surko

What happens once you acquire a new customer? Customer acquisition is certainly important, but in the world of retail it’s only the tip of the iceberg.

A solid customer acquisition strategy will only get you so far on its own — you also need to be able to retain those new customers by keeping them engaged, driving repeat purchases and, ideally, growing their value over time.

In order to achieve those goals, you need to pay close attention to how you speak to customers at different lifecycle stages.

The Case for Building Customer Loyalty

You can’t ignore the need to bring in new customers, but let’s face it: Customer acquisition is hard. And expensive. Data reveals that acquiring new customers can range anywhere from five to 25 times more expensive than retaining existing ones.

And the other side of that coin makes just as compelling an argument for prioritizing customer retention and loyalty. That’s because not only is retaining customers less expensive than acquiring new ones, but increasing loyalty among existing customers is also far more profitable than getting new customers to make their first purchase. Consider the following stats:

  • Only 27% of first-time buyers make another purchase, but their likelihood to return increases with each purchase and most stable businesses find that 25-40% of their revenue comes from returning customers (SumAll)
  • Increasing customer retention rates by 5% can increase profits as much as 25-95% (Bain & Company)
  • Loyal customers are 5x as likely to make repeat purchases, 5x as likely to forgive mistakes, 4x as likely to refer friends and family and 7x as likely to try new products (Temkin Group)

Strengthening Loyalty Throughout the Customer Lifecycle

The case for emphasizing customer retention and loyalty is airtight, but how exactly can you make it happen? It’s all about getting lifecycle marketing right so that you can speak appropriately to customers based on their lifecycle stage and level of loyalty.

To do so, you first need to understand the health of your audience. Specifically, you need to determine which of your customers are active, which are at-risk and which are lost.


Once you have a pulse on audience health, you can take your insight even further to identify your customers with the highest predicted lifetime value and understand the products that interest them most.


Finally, you can put all of those pieces together to launch targeted campaigns based on each customer’s lifecycle stage, lifetime value and interests. For example you might:

Grow the Value of Existing Customers with Curated Product Engagements

One way to grow the value of existing customers is to share curated product recommendations in a series of regularly timed engagements. You might deliver a recurring email campaign to customers who have browsed and/or purchased products, personalize their site experience and/or target them on Facebook. Whatever mix you choose, the key is to create a consistent experience throughout the messaging and content you share across channels.

To ensure consistency and deliver a curated experience, you need to pay close attention to how you segment audiences and which products you feature for each audience. From a segmentation standpoint, consider separating recent browsers from recent purchasers since you’ll likely want to follow a different recommendation strategy for each group. For example, when targeting recent browsers, you might share the specific products they viewed and highlight similar products in the same category. Meanwhile, when targeting recent purchasers, you might show co-purchase recommendations and run triggered emails based on when that product will likely need to be replenished.

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Nurture High Value and Loyal Customers with Exclusive Offers & Messaging

Using predictive models to segment customers based on lifetime value can prove extremely helpful for many efforts, for instance by bringing intelligence to ad buying. But once you build an audience of high value customers, how should you speak to this audience?

Ideally, you want to communicate differently with your high value customers by providing them with ultra-personalized messages and exclusive content. To do that, you might offer high value and loyal customers an opportunity to pre-order new products before anyone else or other perks like expedited shipping.

new audiences for eCommerce email marketing

Re-Engage At-Risk and Lapsed Customers Intelligently

Identifying at-risk customers as soon as possible gives you a better chance of winning those customers back. Of course identifying those customers is only one part of the bigger picture — you also need to act on that knowledge. One way to do so is to create a series of targeted engagements that continue to address at-risk customers until they become classified as active buyers again.

Lifecycle Stage

For instance, let’s say you send a targeted email to customers who have deviated from their individual buying cycle. Within the email, you should feature personalized product recommendations based on the last purchase they made by including similar products, best sellers, new arrivals or top rated products in the same category. You can also send unique promotional codes if you want to offer a discount.

Looking beyond email, you can also try targeting your at-risk customers with advertising. In this case, you might increase your bids for at-risk customers or add bids to search terms you wouldn’t normally bid on only for those customers (e.g. “heels” might be too generic for you normally, but you might bid when valuable customers in your at-risk audience search for “heels”).

How Well Do You Know Your Customers?

Once you have a pulse on your audience, including where their interests lie, how valuable they are to your brand and where they are in their customer lifecycle, the possibilities for marketing to them in unique ways that are designed to boost loyalty are limitless.

But it all starts with knowing your customers. So how well do you know your customers? And how easily can you access the right data in order to have targeted, meaningful conversations that strengthen loyalty?

Check out our playbook, Bluecore for CRM Managers, to learn how you can get access to this type of insight in minutes.

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Kim Surko

Kim is the Vice President of Customer Success for Bluecore. Kim leads Bluecore’s Customer Success Managers, Forward Deployed Engineers and Professional Services to ensure customers’ desired outcomes are achieved. Previously, she was Director of Customer Success and Account Management at Oracle Marketing Cloud – Responsys. Prior to Oracle, Kim was Senior Director of Account Management at digital marketing agencies, providing full-service solutions for martech and adtech partnerships. Kim’s passion for solving customer’s business challenges with marketing solutions has driven her career in customer success.

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