The Distribution Industry: Tips on Customer Retention Through Personalization


Today, distribution is focused on getting products to customers’ hands as quick as possible. In all this quest to be the fastest, the humanity of the transaction can often be sacrificed.

This fact can impact the bottom line for many brands, and finally, distributors have noticed. In fact, 37% of distribution professionals named customer retention as one of their top three priorities in 2022, and the highest non-financial priority.1 Distributors are focused on bringing back human interaction to their businesses through personalized service and one-on-one communication.

The most important component of customer retention is frequent communication and top-notch customer service. In fact, when it comes to besting the competition in communication, no amount of communication should be seen as too much. Modern, successful distributors leverage a variety of communication channels: from social media to text messaging to emails – to cater to different customer communication habits, and do so 24 hours a day, seven days a week. To ensure you’re maximizing your customer communication, you absolutely need to have omnichannel capability. Why? Take a look at this:

In 2021, the breakdown for channel use for distribution industry customers looked something like this:

Distribution Business Channel Use

Though modern-day tools like artificial intelligence (AI)methods have made headway in creating more life-like chatbots and creating better interactive voice responses, today’s consumers still put maximum value on having a genuine human interaction when they need help. In fact, 70% of consumers indicated they rarely or never use chatbots in a recent survey. This is why it is essential to provide more personalized support through live interactions.

Here are some tips on how you can create a highly personalized customer experience for your distribution business.

1. Set-up Your Customer Feedback Options For Success

Just because you have a customer service hotline and have some customer service experts tracking comments on your service doesn’t mean you have a model that is set up for success. In a recent survey of customer service professionals, 67% reported feeling like they couldn’t or didn’t know how to take action on customers’ feedback and were left feeling like all they do record and report poor customer service experiences that end up doing nothing to fix the patron’s problem. Even in our current customer-focused environment, feedback programs are designed to collect comments and complaints but then can’t do much with it, let alone how to make the customer feel like they had a personalized experience that fixed their specific problems.

Personalizing customer experiences means understanding what is most important to customers and then planning a response that addresses the problem the first time. If your customer feedback strategy stops after “collect feedback,” it’s worth exploring developing a robust plan on how to take action. After all, collecting feedback and hearing what matters doesn’t move the customer experience forward. Only acting on that feedback will do that.

Providing personalized customer experiences is the best strategy for earning customer loyalty. When personalized experiences are executed well, according to a recent study can provide eight times the return on investment on marketing spend and even improve sales by 10% or more.

Yet customer experience leaders are challenged to determine which personalization efforts to prioritize and are often unable to provide answers or resolutions for the customer who calls in to complain about a delivery that hasn’t arrived or a client who has received bad service. Customer expectations are higher than ever, and they demand both more empathy and faster resolution.

How do you make that happen? First, ensure your customer service experts with as much customer data as possible. Remember that knowledge is power.

By having a robust, data-driven customer data platform (CDP) Like Group FiO’s CDP, you give not just your customer service staff but your entire ecosystem access to ALL the data available on each customer. By providing a 360-degree customer viewpoint, you enable them to see their entire history with your brand, which provides them with the intel they need to resolve problems more readily. For example, if a late delivery in the past was resolved with a 10% discount, your customer service team is empowered by that knowledge and can offer them a discount in this instance, too, knowing this resolved the problem in the past to the customer’s satisfaction.

2. Ensure Your Collecting ACTIONABLE Feedback

You can’t give the right answers if you start with the wrong questions. Or worse, no questions at all!

Now is the time to focus on your customer feedback strategy. Look for ways to collect feedback along the customer’s journey. Start by having a Customer Data Platform like FiO’s CDP that creates transactional customer journey maps; understand the current state of various touchpoints and how to best include feedback collection along that journey.

The best strategy is to determine where you can customize the journey. For example, a clothing brand can prompt better, more tailored recommendations by having access to the customer’s style preferences, brand favorites, and unique sizing.

It is also important to garner insights at each stage of the customer journey to quickly enhance the shopping experience. By mapping out a customer’s entire journey with your brand and having that intel available to all brand stakeholders, you can determine what inflection points can be infused with personalization and enhance the customer experience from start to finish.

3. Have One Repository of Truth to Tailor Experiences

Personalized experiences mean recognizing who the customer is and where they are on their journey. As the customer moves from shopping to buying to asking for help, they want to feel seen and heard along the way.

A recent study indicates that 52% of customers say it generally feels like sales, service, and marketing don’t share information.

That means customers feel like they are interacting with different entities, not a unified brand. When a comprehensive, centralized view of the customer is absent, it’s challenging to recognize where they are on their journey.

Nothing is more frustrating – or a quicker way to lose customers – then when your customers have to describe their issue through several different “that’s not my department” phone transfers. 65% of customers say they have to repeat or re-explain information to different representatives.

There is no way to personalize a “fragmented” customer experience. Individual company representatives aren’t to blame. They are working with the customer data available to them. Without visibility to the correct data at the right moment, it’s impossible to recognize the customer in a way that respects their overall journey with the brand. Getting a Customer Data Platform like FiO’s CDP ensures you have a central repository of truth that is accessible to everyone. This tells customers you’re a brand that has their act together and puts customer service at the forefront.

4. Connect to Customers Directly

Gathering customer feedback directly shouldn’t be limited to surveys. Brands looking to personalize experiences can stay connected in so many ways in today’s world. Personalization is solving specific, individual problems for the customer with both the product and ongoing service.

The way customers shop with your brand has probably changed in the last decade, too. Providing what they need along this new journey is a great way to deliver personalized experiences and build trust.

For example, traditional makeup brands used many distribution channels to sell their products. Fewer shoppers are buying this way, so many cosmetic brands have had to get creative to connect with customers directly.

For example, the cosmetic brand, Shiseido, sold this way until it saw an opportunity to get to know their customers by offering a truly personalized experience. They did this by building an app that gave users the power to create customized foundation colors that can be ordered directly from the brand. The app makes suggestions for other products they might like and reminds them when they might be out of their customized products based upon the data of their past usage and ordering history.

After seeing success with this model, Shiseido launched a subscription model that leveraged the Internet of Things (IoT) connectivity. This system works by customers uploading a selfie which is then analyzed for skincare factors within a highly customized app. The app then “talks” to a specialized device, which is sent to the customer with five customized skin care products that are uniquely tailored for that individual.

The app also considers data the customer shares, like their sleep patterns, and their current environmental factors like moisture levels and pollution in their region. This level of hyper-personalization means the customer feels truly, personally, cared for by the brand, and like the brand actually KNOWS who they are and values their business. This is what takes a customer from a one-time buyer to a lifelong customer, and THAT is creating REAL Customer Lifetime Value (CLV).

5. Dive into “In the Moment” Personalization

The primary benefit of live chat capabilities is how it becomes an immediate opportunity for a more personalized, one-on-one customer experience.

Why? Because it offers the chance to both serve the customer immediately and gather in-the-moment feedback. When chat is part of your brand’s digital journey, it’s vital to capture feedback and turn them into proactive insights.

Customers report a better opinion of brands that provide proactive customer notifications, and practical chat triggers feels more personalized than often overlooked emails. A reminder prompt that charts, where the customer is on their order journey, can make the difference between a mediocre or outstanding customer experience.

A stat that backs this up? Studies have shown that customers often have questions during the purchase journey, and those who utilize a live chat feature spend 60% or more per purchase than those who don’t interact in this way.

In-the-moment customization can also be provided by offering product quizzes that deliver hyper-personalized product recommendations based on the answers provided. Subscription box brands like Fab, Fit, and Fun rely on quizzes to understand each customer’s product preferences and favorite items.

In 2020, Fab, Fit, and Fun added a live poll feature to customers where they provide thumbs up or down to various items that could be offered in their seasonal box selections. This information informs the algorithm that helps select recommendations for each customer. It also gives the brand personalized intel on their customer’s favorite types of luxury products so they can predict what types of options to offer them during the next season which will likely lead to them choosing more products for their personally curated box. This type of personalization definitely works: The brand reported this poll helped achieve a 15% increase in both revenue and engagement.

To make this type of “in-the-moment” marketing happen, however, you need to be able to not only ask for information but record the intel you receive so that all brand departments can leverage it to boost your brand’s CX. This means having a Customer Data Platform that does a lot more than just collect information. You need a CDP like Group FiO’s that helps you deploy predictive analytics that informs how you interact with customers in the future.

In Conclusion

Distribution companies focused on CX are asked to satisfy a lot of customer wants and needs. After all, collecting customer feedback and analyzing it correctly requires all brand stakeholders to work together to create a cohesive, unified brand experience from start to finish on a constant basis.

By focusing on personalization, distribution organizations can provide both quick wins and long-term successes that boost customer experiences that serve as the lifeblood of modern-day eCommerce success.

And like almost every part of customer experience success, it starts with knowing your customers. Perhaps even more importantly, in the case of personalization, it requires knowing as much as possible about EACH customer. The only way to do this is by having a corporate-wide policy laser-focused on providing the best CX possible, and by having a Customer Data Platform that is robust and high-tech enough to back that goal up. That’s where Group FiO comes into play.

To find out more about how Group FiO’s Customer Data Platform can help you meet the current expectations for modern CX, contact us today by clicking here.

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