With a wealth of companies offering similar products and services, customer loyalty has become more important than ever before. Personalization can play a role in gaining the loyalty of customers, and a report [download page] from Movable Ink finds that two-thirds (68%) of consumers say they are likely to be loyal customers or purchase more from a brand if it engages and builds personal relationships with them.
It does appear that personalization has more of an impact on younger consumers. Close to three-quarters (73%) of consumers ages 18-34 say they are likely to buy goods or services when a brand has created a personalized experience in their brand content or communications with them. The same can be said for the majority of consumers ages 35-44 and 45-54 (67% each). However, fewer of those ages 55-64 (50%) and 65+ (45%) are swayed to purchase goods or services because of personalized communication or content from a brand.
In regards to the type of communication from brands that consumers find more useful, email marketing about sales or promotions (58%) is the most preferred, followed by email marketing to inform them of new products or services (37%).
When Personalization Goes Wrong
While personalization is a priority for marketers — especially as business sectors like e-commerce put a greater emphasis on using personalization for customer retention — brands don’t always get it right. Close to half (47%) of the consumers surveyed by Movable Ink report having received wrong or inaccurate personalization from a brand, including being recommended products that don’t fit their needs (33%) or receiving branded communications with the wrong name (15%).
These blunders can have consequences. When consumers were asked how they have responded when personalization from a brand is wrong or inaccurate, only 13% say they don’t do anything at all. For those that do take action, some of the most common responses were calling customer service and explaining the experience (27%), unsubscribing from emails (26%) and cancelling services or not purchasing from the company again (15%). Others say they spread information about the experience to friends and family (9%), delete the brand’s app on their phone (9%), switch to a competitor (8%), post a bad review (5%) and post about their experience on social media (5%).
Even if consumers don’t take action after having a poor personalization experience, it doesn’t mean that the relationship hasn’t been soured. Some 3 in 10 (28%) say that while they don’t take any action in this situation, the brand loses credibility in their mind.
Characteristics That Create Trust
Research from XM Institute found that top-notch customer experience has a positive impact on customer loyalty. This more recent report shows that, while helpful customer service (78%) and a strong reputation and positive reviews (63%) are commonly cited characteristics in companies that consumers trust, customer experience also plays an important role.
Some 78% of consumers say they trust companies with consistent customer experience, while 54% trust companies that offer personalized customer experience or relevant communications.
The full report can be found here.
About the Data: Findings are based on a May-June 2021 survey of 1,000 US consumers.