Turning Challenging Customers Into Loyal Customers Through Innovation

Senior Vice President

Many industry sectors—especially retail, travel, and credit cards—rely heavily on affinity rewards programs to keep customers loyal. It’s typically a small minority of high-volume consumers, the top 5 to 10 percent, that benefit the most from these programs. Brands typically design affinity programs based on knowledge of what will make the most loyal customer feel rewarded and want to engage more with a brand.

But what about the large majority of customers that don’t fall into these groups? What about those challenging ones that are the least engaged and the most vulnerable to attrition? While it’s foolish to suggest brands offer these customers the same type of incentives offered to their best customers, companies should explore innovative ways to create deeper connections with these challenging customers. There is seemingly a financial benefit in creating a larger pool of deeply engaged customers.

Research among challenging customers is typically transactional in nature and focused on where a service experience may have fallen short. It’s much less common for brands to integrate a holistic understanding of the needs and preferences of the challenging customer into the product and service development process. This feels like a blind spot. A deeper understanding of the challenging consumer—what makes them tick, what they want, and where they have unmet needs—and then creating innovative offerings based on these insights will strengthen loyalty for your brand.

A deeper understanding of the challenging consumer—what makes them tick, what they want, and where they have unmet needs—and then creating innovative offerings based on these insights will strengthen loyalty for your brand.”

Here are some steps brands should take to understand lack of loyalty among customers, and identify innovations to deepen engagement:

  •  Use an engagement spectrum to array your customers and prospects into categories such as loyal, vulnerable, high-potential prospect, and low-potential prospect. This can be done through targeted primary research that asks the right mix of behavioral, attitudinal, and future intent questions. Regression analysis can be used to identify the brand and product drivers that drive customers and prospects up the spectrum.
  • Determine and prioritize the needs of your challenging customers. Use Qualitative immersion to obtain a deeper understanding of the customer’s story. Follow this up with a Quantitative needs prioritization utilizing a choice-based technique.
  • Ideate and design new product and service concepts through a lens of the most critical unmet needs of the challenging consumer. We use real-time optimization techniques to provide seamless consumer feedback into the concept design and refinement process.
  • Optimize the features, benefits, and pricing using a robust discrete choice model. Test among the entire customer base and use the engagement spectrum classifications to filter and build product configurations to align to different customer types.
  • Create messaging that links to the most compelling benefits for challenging customers.

A choice-based technique is a way to build a layered message framework that links to desired behavioral outcomes. These are just some of the ways brands can integrate deeper knowledge from challenging customers into the innovation process to build loyalty. Want to learn how to find innovative solutions to attract your challenging customers?

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