August 27, 2020
Managing customer loyalty with SAP Customer Experience
Head of SAP Customer Experience Competency Center, Solution Architect
Today connected shoppers share their opinions about brands publicly in real time, evolving into active brand ambassadors. According to KPMG’s 2019 report The Truth About Customer Loyalty, 86% of the surveyed participants claim they will recommend a company to a friend or family if they’re loyal to a brand. 66% are likely to write a positive review after a good experience, and 46% will stay with the brands they are loyal to even after a bad experience.
To engage and retain existing customers and acquire new ones, loyalty marketing efforts should be treated not as standalone campaigns but as consistent efforts fitted into a digital customer experience strategy.
In this article, we will look at common loyalty marketing management problems and find solutions based on the best customization practices of SAP Commerce.
According to Deloitte’s 2019 survey Becoming an Insight-Driven Organization, 67% of the surveyed senior and executive managers say it’s inconvenient to access data in their tools and resources. This is quite predictable, as large volumes of disparate data come to companies from all directions.
At the same time, privacy issues and human error complicate adoption of advanced loyalty marketing tools. Private health, finance, legal and accounting sectors suffer the most from data breaches, while customers consider behavior tracking that comes together with loyalty programs as the main deterrent to joining loyalty programs.
The SAP Customer Experience (CX) suite has a number of solutions that facilitate secure consolidation of data from multiple sources.
SAP Commerce’s Master Data Management (MDM) enables users to import, export, and synchronize data by means of Data Hub, ImpEx, Import Cockpit Module, and SAP Commerce-to-SAP Commerce Synchronization (y2ysync).
SAP Commerce Data Hub, a platform for data integration and staging, enables users to load high volumes of multisource data and then process and deliver it to multiple target systems. Data Hub stages data in a canonical form, independent of both source and target systems, and transforms it into useful insights.
ImpEx is perfect for text-based import and export. It enables users to create, update, delete, and export customer data to and from CSV data files during run time, initialization, or updates.
To provide full and correct product information and fill any existing gaps, it’s necessary to aggregate data from multiple channels. Importing data from various systems into a single hub is extremely time-consuming as it requires creating and maintaining import files. The Import Cockpit facilitates imports by allowing users to create import mappings with an easy-to-use GUI tool. The module helps import data into the Commerce Platform module via a CSV source file without having to specify an ImpEx import script. As a result, users get their heterogeneous data consolidated and validated.
The y2ysync module performs SAP Commerce-to-SAP Commerce synchronization. The module synchronizes data between sources and target systems. For example, data can be synchronized between two different SAP Commerce installations, with the Data Hub as an intermediate layer.
Data from multiple sources is difficult to manage because of possible data duplication issues and unsolicited data changes by editors. In SAP Commerce, it’s possible to eliminate this problem by using Catalogs.
Catalogs are containers for holding and structuring content. Catalogs can contain two or more versions:
Catalogs also provide a structure for different levels of maintenance and propagation. For example, it’s possible to simultaneously propagate multiple web storefronts using multiple catalogs.
In catalog versions, products are organized in hierarchical categories, which automates content modification. It’s also possible to maintain specific information types, like metadata, hidden product data, localizations, views, and restrictions. Visibility is controlled by assigning write, read, and edit access permissions to minimize human error.
Distributed import scenarios can be realized via separate catalog versions that may come in particularly handy when product data is pulled from different sources, such as CSV files from suppliers, images from an advertiser’s file system, or prices from an ERP system.
Each source offers a product data type where each data set is related to a particular product. SAP Commerce loads data types into different catalog versions, which allows for different loading and clearing routines. To consolidate catalog versions, users need to synchronize operations into a master catalog that serves as a single source of truth.
Integration with SAP Marketing offers data privacy management opportunities. Leveraging the consent management extension, it’s possible to manage both anonymous and authenticated users, who decide whether they want to share their personal data in exchange for personalized content and offers. Users can ask for their personal data to be erased, or data can be automatically deleted after a certain period within the user’s right to be forgotten.
According to McKinsey & Company, most brands struggle with personalizing their offers, content, and experiences based on customer behavior, and offer no personalization at all or just point-centric programs.
As a result, loyalty marketing efforts feel rehearsed and impersonal.
If you’re trying to build brand loyalty today, an emotional connection is no longer a nice-to-have, it’s a need-to-have.
Global Sector Head Consumer & Retail, KPMG
The SAP CX suite holds a few products that help foster personalization and take care of customer privacy.
When you open the Customer 360 Degree View window, you get access to crucial customer data, such as profile pictures, email addresses, a number of loyalty points, purchase frequency, average spending, discount tiers, store access methods, and attributes like ‘busy’, ‘on-the-go’, ‘early adopter’, ‘tech-savvy’, and so on. What’s more, it’s possible to see customers’ favorite brands, products, and services. By glancing at a product list that will suit this customer best, it’s easy to customize your offer and present it in a manner that appeals to a particular person.
SAP acquired the customer identity management platform Gigya and built SAP Customer Data Cloud (CDC) based on it to bring together identity management and the enterprise tools found in SAP Customer Experience. The partnership made it easy to achieve GDPR compliance with SAP.
SAP CDC includes Customer Identity and Management solutions that provide an in-depth customer view based on three major components:
According to Research and Markets’ Location-based Services Market Trends report published in 2020, the location-based services (LBS) market was valued at $36.2B in 2019 and is expected to reach $126.4B by 2025, driven by smartphone usage proliferation.
It’s proven that using LBS for marketing and advertising increases audience and customer engagement.
Still, many brands show low adoption rates or don’t use this technology at all, thus missing out on extra personalization opportunities.
Mobile LBS in SAP is based on SAP Commerce’s Store Locator, part of the Cart & Checkout service. The feature helps find stores by postcode areas, a city name, or by using Global Positioning System (GPS) coordinates. As a result, customers can see a store nearest to a provided location. This feature, coupled with the directions to the closest store and in-stock information, helps users make conscious purchases instantly.
Using the Store Locator Configuration and a mobile template with a store location functionality, it’s possible to check the position of a mobile phone in relation to the store and PoS database in SAP Commerce.
What’s more, SAP Commerce’s Personalization Module can offer content depending on the user’s geolocation, like personalized website content or special offers.
Most customers want loyalty programs that are worth their time and effort. They favor ‘anytime anywhere’ access, and their time investment should be worth it in terms of quality, consistency, and value for money they get in return.
When customers find it hard to interact with brands across multiple touchpoints, they feel as if they waste their time and therefore can easily switch to other brands in spite of their participation in loyalty programs.
Modern connected customers use multiple channels to make a purchase. For example, a customer can see a new product on a billboard or use a print catalog to choose a product, order it online, and pick it up at the closest shop. Under these circumstances, companies need to pursue a consistent cross-channel approach as an efficient way to leverage customers’ behavior to their brands’ benefit.
Omnichannel and cross-channel tools from the SAP Customer Experience suite allow selling across different distribution channels based on consistent, single-source and easy-to-access information. These easily scalable tools enable feeding information into multiple channels and other tools, as well as implementing such channels as web and mobile shops, print and online catalogs.
To ensure product, pricing and promotional information consistency across all channels, there’s a strong need for a single product data source. The Product Information Management (PIM) API allows SAP apps to access data from PIM systems, like online catalogs, web shops, POS kiosks, mobile apps, call centers, etc., thus centralizing product data management and ensuring cross-channel data consistency.
With SAP Commerce, it’s easy to plan and execute complementary or channel-specific marketing campaigns across all distribution channels. For example, the SAP Omni Commerce Connect module helps companies use the SAP Commerce functionality anywhere in the existing app landscape and take a customer-centric approach to channel-specific processes. The tool can be integrated with other systems, making it easy to reuse sales workflows and data across all touchpoints, increasing speed and lowering costs.
As a result, companies can pursue an agile transformation roadmap, seamlessly communicate with customers, and sell via online stores, social networks, smartphones, tablets, or any other internet-enabled devices.
Customer loyalty programs have a great potential for attaching customers to a particular brand. At the same time, these programs are highly prone to losing their efficiency once customers feel they don’t get any value from them. In order to build meaningful and customer-centric loyalty marketing strategies, make use of the SAP Customer Experience suite. To give you a quick reference, I’ve consolidated all the recommended tools into a single cheat sheet.
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