Before the advent of mega-malls and big box retailers, consumers shopped at local businesses that were fixtures in their communities. In the U.S., these communities were found on ‘Main Street’ and in the UK, ‘The High Street.’ Customers felt like they were part of a family – and their loyalty was a given.
Today, as consumer culture changes, most of those local retailers (and banks) have been replaced by malls and national chains. The personal connections once held between merchants and their customers has either been weakened, or lost altogether. Nearly a third of senior bank executives told Temenos and Deloitte that driving customer loyalty is now their top challenge –a challenge now common to all industries.
Kobie’s President, Michael Hemsey, recently authored an article for DMNews addressing this topic. In “Why Mobile Is the Key to Maximizing Customer Lifetime Value,” Michael says that mobile devices are the perfect tools for driving not just short-term loyalty but customer lifetime value (CLV). While CLV is generally defined as a customers’ total economic value throughout the merchant/customer relationship, Kobie defines CLV as the total amount a loyal customer could spend with a brand over time if transactional barriers to engagement are removed.
While mobile innovation is often considered a top priority by business leaders, many brands have yet to maximize its long-term customer engagement potential. This is truly unfortunate as smartphones are ideal loyalty drivers and engagement tools thanks to their unique ability to capture real-time customer insights. All of this holds true for a host of smaller businesses as well as the larger ones.
In order to maximize CLV through the mobile channel, Michael’s article lays out the following recommendations:
- Don’t tear customers away from the engagement path/s they’re already on.
- Engaging customers doesn’t mean convincing them to give up their bottom dollar. Focus on providing loyalty experiences that make customers more likely to spend their money at your business versus somewhere else.
- Don’t make engagement more difficult. Make it convenient and focus on maximizing those coveted consumer “in-between times.”
As a portable social media gateway, mobile is an excellent metrics-gatherer and brand educating device, and, increasingly, it’s also the platform where loyalty programs must exist if they are to excite—and retain—customers.
Courting consumers on this highly social channel can help loyalty marketers build stronger relationships and optimize their customer lifetime value. How does your brand using mobile to engage and retain customers?
We’d love to hear about your challenges and best practices for developing a mobile engagement strategy. Share your views below or send an email to firstname.lastname@example.org.