Posts by: Mark Murray

#AskYieldify: loyalty and lifetime value

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In this series, we put the big e-commerce questions to our crack team of expert consultants. 

This month, we’re talking loyalty and lifetime value (LTV), with Mark Murray, Head of Travel.

In last month’s edition of #AskYieldify we learned all about the power of social proof. This time we’re looking at loyalty and lifetime value, so let’s get started…

Why care about customer loyalty?

There are lots of reasons to look at how you can create customer loyalty, as well as improve the journey for your loyal customers. Here are just a few:

  • “The success rate of selling to an existing customer is 60-70%, while the success rate of selling to a new customer is 5-20%” – Marketing Metrics
  • “Existing Customers are 50% more likely to try new products and spend 31% more, when compared to new customers” – Modern Marketing

Yet, despite these oft-cited statistics, marketers are still pretty firmly focused on acquisition, with more than half in a recent survey stating that they spend 60% or more of their time and resources on acquisition.

But some marketers are coming around to the idea that it’s not all about acquisition, by digging into their own data to understand the value of ‘loyal’ visitor segments.

At our recent #Journey2019 event Sam Willan, General Manager at StudentUniverse shed some light on why the travel brand is looking to loyalty:

Source: Sam Willan, General Manager, StudentUniverse UK speaking at #Journey2019

Sam presented some pretty compelling numbers, demonstrating that for StudentUniverse at least, loyal customers are worth focusing on, summed up nicely by this quote:


A repeat booker costs half as much to acquire and returns 2.5 times in income”


Sam Willan, General Manager, StudentUniverse UK, speaking at #Journey2019

How can brands leverage loyalty to drive conversions?

When it comes to loyalty, one of the first techniques that come to mind is loyalty programs. But driving value from a loyalty program isn’t as easy as setting up a scheme and waiting for the conversions to roll in.
One of the biggest challenges is actually getting visitors to join the program in the first place.

We’ve found that emphasizing the benefits or unique selling points of your loyalty program is one successful tactic to try. A retail brand we work with tested this out by highlighting the benefits of its loyalty program with a corner notification when visitors were about to register as a user. The campaign worked so well that this has now been incorporated as part of it’s registration page.

Personalization is also really important when it comes to loyalty messages. Beauty brand Skyn ICELAND, personalized based on whether a user was new or returning to drive registrations for its newly launched loyalty program:

Skyn Iceland: building loyalty and lifetime value with personalization

Once you’ve registered your users, activating them is the next challenge. Reminding members of their rewards is another way personalization can help drive conversion. In another example from the world of beauty, haircare brand Ouidad serves different messages to depending on the loyalty level of a consumer.

Ouidad: building loyalty and lifetime value with personalization
Ouidad use different messages for subscribers vs. customers

The brand created campaigns to re-engage lapsing users and reward top customers, driving a high level of engagement and boosting loyalty and lifetime value. Last year, Ouidad loyalty members had an average repeat purchase rate of 54.4% (vs. 29.8% for non-members) and a higher annual purchase frequency.

How can I build loyalty and lifetime value as a luxury brand?

Luxury brands can have a bit more of a challenge when it comes to loyalty programs, as giving away discounts can be seen as detrimental to the brand. As always, it’s important to test and learn to find what works best for your audience.

For instance, a luxury department store tested out placing a points-led message front and centre, to drive uptake of its loyalty program. However, the analysis revealed that this ‘push’ style message was not having a positive impact. With this learning, the brand was able to quickly update the format of the messaging to act more as a reminder, giving users the choice to interact if interested, rather than forcing the message on them.

A more subtle ‘pull’ style message can be more effective for luxury brands

How I can optimize the post-purchase experience for loyalty?

Building loyalty and lifetime value isn’t just about loyalty programs, it’s about providing value and driving engagement, fortunately, there are lots of ways you can do this. Post-purchase is the perfect opportunity to point users toward other content or channels you want to highlight, such as social media platforms, as you can then build a much more regular rapport with them.

You might also want to push users toward your app, as it’s been shown mobile can be a powerful driver of customer loyalty. You could also take the opportunity to incentivise your users further, by offering a discount on subsequent purchases, or in exchange for a referral.

Interestingly, post-purchase can also be a great moment in which to secure loyalty scheme membership. At this point in the customer journey, you have enough data to make a pretty compelling and personalized offer to your audience. One technique we have used successfully is by dynamically populating messages with how many points visitors could earn, based on the purchase that has just been completed. A recent campaign with a travel brand drove uplifts of +5% in conversion rate by showing this alongside USPs.

Building loyalty and lifetime value in travel

What part does customer feedback play when it comes to loyalty?

Customer feedback is an important tool to both create and build loyalty and lifetime value along the customer journey. If you never ask your customers what drives their loyalty and satisfaction, it will be impossible to amplify and recreate this…or know where you’re going wrong.

But when should you ask customers for feedback? Think about this carefully – for example, if you’re a travel brand, asking a user to rate their experience after they have gone on holiday may not be the best time to get online feedback.

This is something that should potentially be done after the booking is complete and before they travel, that way you can be assured they’re rating the booking process and experience of your site, rather than the holiday itself! For more tips on customer feedback and reviews, check out our very first #AskYieldify blog.

If you’ve got an e-commerce question you need help with why not #AskYieldify? Tweet us, or email us on info@yieldify.com, for a chance have your question answered by our e-commerce experts