Guest Column | March 3, 2022

Encouraging Shopping Loyalty In The Opt-Out Era

By Charlie Casey, LoyaltyLion

Retail Holiday

Since the early 2000s self-service e-commerce platforms (like Shopify) have gained popularity right alongside the increasing adoption of Facebook and Instagram ads. It makes sense. Cookies and the ubiquity of social media provided marketers with an avalanche of individual user data. Data that underpinned most digital marketing activities at the time. 

But the e-commerce landscape has changed. Privacy rules along with savvy consumers – who now understand the value of their private data – mean many shoppers have and will continue to opt-out of app tracking while the cost of digital advertising continues to rise. Costs are growing particularly fast globally, with social media leading the market with a projected 14.8 percent annual growth by 2024.

The Times They Are A-Changin' In eCommerce Marketing 

As customers become increasingly choosy where they share their data, e-commerce marketers must have strategies in place to capture the attention of these potential customers and make sure they gather the data essential to gain their trust, keep them, and increase their lifetime value. 

The way to acquire new customers is to further engage with existing ones – specifically a brand’s insider community. These are the shoppers that are loyal to a brand and frequently interact with it. They share personal information, provide insight on social media, refer new customers, and frequently make purchases. The math is significant here – an insider community makes up the top 20% of customers and they generate approximately 50% of a brand’s total revenue. Insiders are emotionally invested shoppers that are looking for an individualized shopping experience personalized to their preferences.

It’s important to keep the insiders opting into a brand. To help them do that, brands must know who they are and what they want. To achieve this, brands could run on-site notifications or quizzes where customers receive loyalty points when they share data. 

Once retailers know who their insiders are, they can re-target them with personalized texts and emails with incentives for loyal customers. And it works too. Personalized loyalty emails have a click-through rate 20 times higher than standard e-commerce emails. Tailored information for each customer is impactful as it is not just marketing aimed at anyone. The insider knows that, appreciates the effort, and will keep shopping and sharing data in exchange for additional incentives. 

Specialty Programs Keep Shoppers Coming Back

An emotional connection to a brand is also key to customer loyalty. VIP programs where customers receive something for the data they share are effective in increasing lifetime value. Special gifts or early access to a private sale can be given in exchange for opting in and are methods that keep customers coming back. Loyalty programs that support causes or brand values, such as cruelty-free products or let customers donate to a worthy charity, also motivate insiders to engage with and support a brand.

Connecting with insiders emotionally will keep them returning to engage, spend, and share their data over time as they will know they will receive extra perks and special treatment in exchange for their personal information.

Insiders Share The Love 

Finally, it is important to remember that an insider community is a group of brand supporters. Keep them happy and they will help grow a business more cost-effectively than a business would see through more traditional means like advertising. In fact, rewarding insiders for every successful referral should be standard practice for a brand. It encourages community growth with minimal monetary investment. Plus, a majority of shoppers trust recommendations from people they know because they expect them to be truthful about products and the experience. Once trust is established by a brand, those new customers can be nurtured to become insiders, as well.

This year will be pivotal in defining the opt-out era. As shoppers choose to and not to engage, one thing will become clear. Offering tailored experiences, incentives and extra value to an insider community will mean they’ll share more personal data to get more of these experiences. Brands will then have the information they need to keep engaging and acquiring customers, helping them grow in the opt-out era.

About Author

Charlie Casey is CEO and Co-Founder of LoyaltyLion, a data-driven loyalty and engagement platform that powers e-commerce growth. Proven to increase retention and spend, LoyaltyLion is trusted by thousands of fast-growth e-commerce merchants worldwide. Before founding LoyaltyLion, Charlie joined the Foreign and Commonwealth Office as an Economics Advisor before becoming a consultant at Deloitte.

About LoyaltyLion

LoyaltyLion is a data-driven loyalty and engagement platform that powers e-commerce growth. A loyalty program is about more than points and rewards. It is about unlocking real insights to increase customer lifetime value. With LoyaltyLion, you can build a better understanding of what drives longer-lasting customer relationships and use those insights to connect and accelerate your existing marketing efforts. Proven to increase retention and spend, LoyaltyLion is trusted by thousands of fast-growth e-commerce merchants worldwide.