Thanks to Jennifer Dawson for the following.
Around 75% of businesses believe they are customer-centric, but just 30% of consumers agree. The dichotomy should be a powerful motivator for businesses wishing to increase customer loyalty. Considering the Internet of Things and its implications on market behavior, enticing customers with your products or services is no longer sufficient when it comes to achieving business success. Companies like Apple boast a unique percentage of loyal clients; they have managed to strike the exact balance between design, branding, and functionality, but not every product is a feat of design. This is why companies need extra tools, such as price analytics, to attract and retain clients.
Why is Customer Loyalty Key?
According to McKinsey Research, around 58% of customers freely switch from brand to brand. Only 13% are completely loyal to their favorite brands and around 29% shop from others but always return to their usual brands.
Research indicates that older generations are more loyal customers in general, with younger shoppers heavily influenced by the appeal of the Internet. Now more than ever, it is possible to glean information on issues such as value, ethics, price comparisons, etc. Regardless of age, the vast majority of shoppers have no issues with changing from one brand to another following poor customer service.
How Can Price Analytics Boost Customer Loyalty?
Price analytics software can process massive data sets, obtaining information from sources such as emails, social media comments, video files and more to discover important patterns and trends that enable companies to set the rice price for their products and services. Price management initiatives can increase a company’s margins by up to seven percent in a year, significantly improving its ROI. However, many companies fail to leverage the potential of ideal pricing because they lack the right analytical tools. Therefore, they are unable to react with due agility to issues such as changes in demand, pricing expectations, etc.
Price Analytics and Payment Options
The benefits of price analytics extend beyond mere setting of the right price for products or services. They also enable companies to focus on particular customers – those who bring in the most profit. By analyzing their purchase habits and preference, companies can build bespoke customer loyalty reward systems and accept payment methods that favor clients with rewards and points systems. Payment options should not only broad, but also compatible with mobile technology. Research indicates that around 1.6 billion people use their cellphones to shop online globally, and these devices being used to make 19% of all retail e-commerce sales.
Price analytics are important in a day and age when ubiquitous connectivity and the potential to reach a global market, mean that pricing and building customer loyalty according to ‘gut instinct’ are no longer sufficient. Analytics allow companies to employ key considerations when determining price, all of which are vital to attract new customers and retain those who are savvier than ever when it comes to price comparisons and obtaining value for their money.