Win Over Loyal Customers This Holiday Season with First Party Data

Dive into the recent report by SalesForce entitled “State of the Connected Consumer,” and the trend is clear. A massive 72% of consumers confess they've swtiched to new brands, lured by better deals. With the rising costs of acquiring new customers and shrinking budgets, brands are at a crossroads. Yet, amidst this backdrop, a silver lining emerges for online retailers: the goldmine of first party data.

Let's pause and ponder over this: 66% of decision-makers in U.S.-based e-commerce giants have vigorously collected this invaluable data ahead of the festive season. Why? Well, the modern shopper craves tailor-made online experiences. It’s not a mere nicety but a demand. If numbers speak louder than words, how about this: 75% of consumers are ready to shell out more for a personalized shopping journey, according to Bolt.

Why Loyal Customers are Retail Gold

Think about it. It's not just the tinsel and twinkling lights that bring joy in late November and into December; it's also the whirl of discount offers and "exclusive for you" deals. Retailers have come to a realization: Offering exciting deals to draw in a brand-new customer can be increasingly daunting and expensive.  

So, the focus for retailers has shifted toward those who've stuck around — retaining loyal customers. These consumers are not just buyers; they're brand advocates and influencers in their own circles, and they are willing to pay more for a personalized shopping experience. In order to create these personalized experiences, brands must look to zero party and first party data.  

Zero Party vs. First Party Data: The Path to Customer Loyalty

In this shifting landscape, zero party and first party data have emerged as superheroes of the retail world. Let’s understand the differences between these types of data.  

Zero party data is what consumers willingly share — think of a customer telling a skincare brand that they have dry skin. It’s golden information for curating a hyper-personalized experience.

First party data, on the other hand, comes from interactions like clicks or purchase history. Imagine you're selling gourmet coffee. Zero party data tells you the customer loves dark roast. First party data shows they buy dark roast coffee every two weeks.  

Marrying the two, you could send a personalized reminder, complete with a dark roast discount, just when they’re about to run out. You'll see that when you anticipate the needs of your customers, you’re saving them time. By offering a deal, you’re saving them money as well. Now you're heading down the path of customer loyalty.

Nailing Personalization: Here's How

Effective personalization is a blend of art and science. A haircare brand could capture zero party data by asking customers in a digital ad what their biggest hair concern is. Based on the answer, the brand can then offer tailored solutions in the very same ad, navigating the customer down the path of purchase.

However, personalization isn't just about targeted ads or tailored emails. It’s also about enhancing the entire shopping journey. Brands can integrate data to offer features like Buy Online, Pick Up In-Store (BOPIS), showing real-time inventory in a consumer’s favorite or nearest store. It's convenience wrapped up with a bow, and it’s precisely what the modern customer craves and has come to expect. For example, in the Salesforce report, 80% of customers believe their shopping experiences should improve due to all the data that’s collected by companies.  

Customer Loyalty Demands Privacy

But let's not overlook the elephant in the room — privacy concerns. Apple’s recent Mail Privacy Protection update has upended the way retailers interact with their customers via email. Gone are the days when tracking open rates was as simple as pie. Now, you'll have to focus on clicks and conversions, metrics that offer a more accurate pulse of customer engagement.

That brings us to another critical point: The necessity of adjusting to a privacy-first world shouldn't deter you from data-driven personalization. The key lies in zero and first party data, which not only provide valuable customer insights but also adhere to privacy norms.  

4 Tactics to Create Loyal Customers

1. Use Zero and First Party Data Like a Pro

Zero party data is gold; it's the intentional, explicitly stated preferences your customers share. Pair that with first party data, plus the tracking of actions like purchase history and website behavior, and you've got a recipe for hyper-targeted, super-personalized experiences.

Suppose you’re a skincare brand. Imagine sending a questionnaire asking your customers about their skin concerns, then using that data alongside their purchase history to recommend products. Trust us, they’ll appreciate it.

2. Roll Out the Red Carpet with Loyalty Programs

Get creative with loyalty emails. Ask your customers engaging questions. Show them how far they’ve come and reward them for filling out profile details. It's not just about selling; it's about making them feel seen, heard, and valued.

3. Don’t Sleep on BOPIS (Buy Online, Pick Up In-Store)

Let's be honest, convenience reigns supreme these days. For brick-and-mortar retailers in particular, BOPIS isn't just a trend; it's a growing phenomenon. Merge this with customer data, and you can direct your shoppers to the closest store with available stock. In an age of looming supply chain issues, this is more crucial than ever.

4. Embrace the Power of Omnichannel Messaging

Your customer’s journey doesn't just start and end with a single click. Use their website behavior, like abandoned carts, to send them relevant notifications across multiple platforms. The more tailored the experience, the more likely they are to hit “buy.”  

Rising Above the Noise

The reality is, even with solid plans for personalization, retailers face an uphill battle. Customer acquisition costs are skyrocketing, third party data is becoming obsolete, and budgets are tight. Despite these challenges, forward-thinking brands are focusing on personalization strategies that offer a simple and converting customer experience.

To really make an impact this holiday season, don't just focus on getting a click; concentrate on what that click can turn into. After all, it's not just about today's sale; it’s about building a long-lasting relationship with your customers. And let's face it, in this increasingly complex retail landscape, that's the kind of relationship that can turn the tide in your favor.

Creating personalized shopping experiences can be achieved through zero and first party data strategies. And in order to collect zero party data effectively, brands must first engage with your customers by utilizing privacy-compliant, first party data solutions. If you’re interested in taking this pivotal first step toward customer loyalty, request a demo with DrivenIQ today.