Retail/Shopping/Commerce
Loyal Customers- The Untapped Goldmine

CPG Companies should have more interactive conversations with their customers. If they don’t, consumers will simply switch brands. Catalina Marketing found that 70% of consumers who said they were loyal to a specific brand for the first year declined to only 46% the following year. The main reason they left was because they couldn’t find any strong reasoning why they needed to buy that specific brand. Based on these results, there is more opportunity in investing in pivotal consumers than in average consumers who are so fragmented and less loyal. The benefit of focusing on Customer Lifetime Value is that companies will receive more returns with smaller costs when they invest in valuable customers than in non-pivotal customers. Instead of sending massive messages to customers, companies should personalize the communication which is more relevant to their customers and give them rewards for sharing the brand with their friends: an opportunity to acquire new customers.

Source: Ad Week / CNRI

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