• Marketing Team

How can personalized customer experience increase revenue and loyalty?


Personalized customer experience increases revenue and loyalty: let’s see how. Boosting customer loyalty is the real goal of every company, and even more so today. It's the best way to move with confidence in the market, increasing turnover and revenue. The first and most important step to consolidate loyalty is to pay surgical attention to all aspects of Customer Service?

In the digital era, the most important ally in this sense is the analysis and interpretation of data, which allows you to know your audience and segment it into increasingly specific clusters, with homogeneous and consistent characteristics.

The final goal? Not limiting yourself to segments but really aiming at individuals, with Customer Care operations and one-to-one dialog. This is what we mean by personalization, the real turning point for increasing the rate of Customer Loyalty.


For a business, it costs six to seven times more to win a new customer than it does to retain one. It's good to start with this important realization. This is a fact that emerged from an in-depth and well-known analysis by Bain & Company (inc.com).

This is an awareness that all brands must have in mind, especially today in the age of digital marketing and customer service.

Digital Transformation, in fact, has been a real revolution that, for the business world, has overturned the brand identity of all companies in the sector (from giants with decades of history behind them, to startups).


The most obvious end result is this: The customer has truly become the center of everything. A customer who is no longer a number or a generic "target," but increasingly a person with his individual characteristics, his "geolocation," his past, his habits, his behaviors, and his potential needs.

All of this, today, can be tracked and exploited thanks to data analysis. From here, we then move on to data-driven Marketing and Customer Care. And finally to personalization, which is the focus of specialized companies like Babelee.

The path to Customer Loyalty today passes through these stages, and it is precisely this path that we will trace in the continuation of this post.



What do we mean by Customer Loyalty? Why is it so important? How is it achieved?

Not surprisingly, Customer Loyalty (or Brand Loyalty) is, literally, a customer's loyalty to a brand.

But if you go beyond the label, the matter becomes more complex.

We can talk about something as simple as a positive attitude towards a brand: it's called "acceptance," the first level.

If it goes beyond acceptance, we’re now talking about a "preference." This is the technical term that indicates the preference that a customer gives to the products of one brand over those of another, in a constant manner.


Finally, there is "allegiance" or "brand insistence:" When we put our absolute trust in a brand, so much so that we are unwilling to accept similar products or services offered by other brands. It is the final and most important stage of Customer Loyalty.

It goes without saying that this last level is where we must aim.

Now let's ask: Why is Customer Loyalty so important? And why, after all, is it the most important thing for a company in any industry in the digital age?

The answer is very simple, we have already seen it in the analysis by Bain & Company mentioned above.


Winning new customers is expensive and complex. It requires establishing marketing strategies with results that are not always guaranteed, investing a lot of time and resources, and being at the mercy of changes in context and sentiment.

Working on loyalty and Customer Loyalty, instead, brings solid and sure results; it's a more targeted, surgical, and measurable strategy. And it costs less.

And that's not all. A loyal customer becomes the first marketing vehicle for a company. Through the classic - but always incisive - word of mouth, which today also lives in the digital environment on social networks, for example, or on the most diverse platforms that allow customers to share feedback on companies, services, or products.


So, what is the starting point for working on Loyalty?

Again, the answer is simple: improving the Customer Experience, because a personalized customer experience increases revenue and loyalty.

It's no coincidence that, according to a recent Gartner survey, 81% of marketers expect that Customer Experience will be the main aspect on which marketing challenges will be played out in the coming years, first and foremost that of achieving maximum Customer Loyalty (gartner.com).

And that's not all.

A study conducted by Groove showed that 9 out of 10 customers have left their old company to become users of another one because of an unsatisfactory Customer Experience (groovehq.com).


This figure is echoed by those of the Customer Experience Impact Report, according to which 89% of users switch to a competitor because of customer experience issues (oracle.com). Moreover, 86% of customers say they are willing to pay more in exchange, again, for a better customer service experience and dialog with the company. And 65% say that a positive experience with a brand is far more important and influential than any type of advertising campaign (uperoffice.com).

In short, it's clear by now, and all of the data is moving in the same direction. Loyalty is the real goal that companies in every sector must aim for. And, a personalized customer experience increases revenue and loyalty.

To achieve this, companies must start from the experience of "care" and "dialog" with their customers. By learning, first of all, to know their characteristics, their behaviors, their desires. All of this while trying to personalize experiences as much as possible.

But how is it possible to do this when we're talking about large or very large numbers? The answer lies in data analysis.



A question of data

The driver of Digital Transformation - and therefore of business today - is the enormous availability of data: that's why it is called the "oil of the digital age"?


But where is this data found?


Practically everywhere.


We all continuously leave a huge number of "digital traces" online. When we use search engines, when we use navigation systems, when we download apps and use them, when we use messaging systems of any kind, when we post or express preferences on social networks (and in many, many other situations).


Moreover, with geo-targeting systems this information is, on the one hand, multiplying; on the other hand - and this is even more interesting - it is becoming more and more precise, specific, dynamic, and in real-time.



So what should brands do?

First and foremost, learn how to collect this information, and as much as possible of it, but also with the highest quality and accuracy.


Companies must be able to collect as much information as possible about their customers, across all digital touchpoints. You have to do this in a functional, omnichannel way, selecting the data that is most significant and useful for your purposes from the mass of "Big Data."

The next step is the analysis and interpretation of this data, which must be dynamic and functional for your business (and here the most advanced analytics tools, but also Artificial Intelligence and Machine Learning, come to the rescue).


At this point, brands will have an invaluable asset in their hands: a snapshot of their customer base, both actual and potential. An image that is dynamic and constantly evolving, which tracks changes in behavior and habits over time and space.

Finally, the analysis and interpretation of all this data allows you to get to know your audience and divide it into consistent, increasingly specific segments that you can target them with operations that are as "tailored" as possible.


Think about a simple email campaign. Leveraging segmentation in the right way allows you to increase revenue by as much as 760% (campaignmonitor.com).

You can understand, of course, how fundamental this is to gain the attention of your customers and keep it alive; to first increase engagement and, consequently, trust and loyalty, with targeted and well-calibrated actions over time.

Can you go even further? Yes. You can go as far as personalization, and that's what we'll see in the next section, at the end of this post.



A question of people - personalized customer experience increases revenue and loyalty

For as long as commerce has existed, there is one thing that is more important than all others: addressing customers by treating them as people, as individuals, taking care of them in a targeted manner, because you know their characteristics...and therefore you can anticipate their desires.

It's an experience we all know well: The best shopkeeper is the one who knows who you are, the one who knows your tastes, who is not intrusive but is able to offer you new products and services that meet your expectations and the benefits are always mutual: both for those who buy and for those who sell. The perspective is win-win.

Can all of this be transported into the digital age?


Of course, you do! That's what personalization is all about: the ultimate, most advanced stage of data collection. In essence, it's about pushing target segmentation to the extreme, down to the individual person.


And, starting from here, building a truly one-to-one dialog with the individual, an intimate, interactive, and bi-directional communication.

In short: Here is the oldest secret of commerce, transported into the digital world. This is the most effective way to make Customer Loyalty soar in today's world.

A concrete example?