Your Best Customers are usually the top 10% of your customer base, in terms of transactions, monetary spend, and engagement. We typically see that these customers generate on average up to 60% of a brand’s revenue, making these customers too valuable to lose. While focusing on 10% of your entire customer base may seem expensive and time consuming, not providing these customers with a tailored experience could mean a huge loss in revenue over time.
All customers should receive a positive experience from your brand, but your Best Customers should be treated like VIPs. They have spent a lot of money with your brand, and deserve all outreach communications to be personalized.
Below are some tips to get started with providing your Best Customers the best experience:
Define Groups Within Your Best Customer Base
Once you define who your Best Customers are, we recommend segmenting them into sub-groups to further analyze & predict future behavior, as well as test personalized treatment options. We recommend three-five tiers depending on the brand.
These tiers range from:
- New customers who have just qualified for Best Customer status
- Customers who have been best customers in the past, but don’t qualify year over year
- Customers who are long-term, consistent Best Customers
- “Hidden Gems”. These extra special customers are the top 2% of your customer base, and continue to spend the most and most frequently
Inform them (or don’t)
Whether we let Best Customers know they are part of an elite group or not depends on the brand and its willingness to help steer customer behavior. An example of a brand that lets customers know about their Bronze, Silver, Gold, and Platinum tiers is White House Black Market. Members know that they need to spend a certain amount each year to maintain or advance to a higher tier. Through targeted marketing, they are provided relevant messaging which encourages them to keep spending with hopes of qualifying for a higher tier. On the other hand, one of our retail clients prefers to Surprise & Delight their Best Customers annually with a generous gift card. These customers don’t know what they did to qualify for this reward, but they are being thanked for their continued loyalty to the brand. There is no right or wrong answer. It depends on your customers and what your insights are telling you will work for best customer retention and reactivation.
A Step Above
Other than a one-off Best Customer lifecycle campaign, how are marketers supposed to make these customers feel special? After all, you want them to continue to receive product launches, birthday, anniversary and seasonal emails, but you need to make them different. By making your general marketing communications more engaging, you can still get your branding message across to your Best Customers, but in a way that puts them first. For a product launch, you can host a private, in-store event where they get first dibs on your new line. You can ask them for the feedback on products and styles and then make it known that their feedback is driving some of your branding decisions. You could even send them a gift with purchase a few times a year, or have their personal store associate reach out just letting them know they are appreciated and valued. Get creative and engaging, keep it on brand, and make sure these customers feel like VIPs.
With your Best Customer group, you can’t have a set-it-and-forget-it plan. It will become stale, and your long-term Best Customers will notice. Brands must pay attention to the data to drive new treatment strategies or tactics to keep your Best Customers engaged. It is important to not only have a strategy in place to retain your Best Customers, but to have one in place to prevent them from lapsing. If you see customers from your various tiers on the verge of lapsing despite the generous ways of trying to retain them, you will need a separate treatment strategy to win them back. A Best Customer segment manager should be recruited to live and breathe best customer insights and treatment testing, while knowing that this is a forever evolving strategy.
With a constant focus on this customer group, and a little extra effort and love from the brand, these customers will continue their loyalty, increasing their future value and ultimately, growing your customer revenue.