The Three Pillars of Customer Loyalty: Why, Who and How

The Three Pillars of Customer Loyalty: Why, Who and How

Modern consumers expect personalized experiences and will abandon brands that fail to deliver them. While all brands recognize the necessity of such experiences, many companies struggle to form a comprehensive view of their customers, and an even higher number struggle to deliver contextually relevant, personalized customer experiences.

Companies recognize that they need to take loyalty more seriously—the problem is that they don’t know where to start. This article explores how customer data platforms (CDPs), AI agents and machine learning (ML) tools can solve this challenge.

Outline the “Why: Behind Customer Loyalty

First, it is crucial to outline the “why” behind customer loyalty. Loyalty is meant to increase customer lifetime value, acquire more customers, increase revenue, improve customer satisfaction, etc. These outcomes are interrelated and will influence each other in some way. It is also important to align on frameworks that help define customer lifetime value and identify key growth drivers. A well-established value capability matrix (KPI tree) is essential to connect these value drivers with measurable outcomes. By setting up a feedback loop, organizations can also measure the impact of loyalty initiatives and make continuous improvements utilizing pre-established lagging and leading indicators.

Establish the “Who”

To truly understand their customers, brands must first identify “who” the customer is, which requires building a unified view of each individual, collecting attribute, engagement, and interaction data across touchpoints. Accessing this data across all departments is essential for delivering personalized and compelling customer experiences.

A CDP solution integrates an enterprise’s customer data from sales, commerce, marketing, contact center, and other systems into a single, easily accessible source of truth. This platform merges every detail, from demographic information to behavioral insights, to help brands achieve a 360-degree view of their customers. Without a CDP, a company may have multiple versions of the same customer across different systems, sometimes in the same system. A CDP resolves this identity dilemma with direct or fuzzy matches to create one unified record for that customer, such as determining that three email addresses and two different physical addresses belong to the same person.

A CDP can also help companies enhance and enrich their data. For example, by connecting a CDP with various external and internal data points, brands can ascertain a customer’s total lifetime value, including their preferred channels of engagement, favorite products and other behaviors like price sensitivities.

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