Teleflora uses Custora’s segment-based testing capabilities to foster loyalty among its most valuable customers.
Teleflora is a Los Angeles-based floral delivery company that partners with over 13,000 florists located throughout the U.S. and Canada. Tommy Lamb, Teleflora’s Director of Loyalty and Retention, recently spoke with us about how his company leverages Custora to foster loyalty across various segments of its customer base.
Teleflora is particularly interested in nurturing first-time buyers into repeat customers (research shows that repeat customers account for roughly half of the average retailer’s revenue). Since a repeat buyer represents a higher lifetime value than a one-and-done or irregular shopper, a retailer can raise its bottom line considerably simply by increasing the number of repeat buyers in its customer base.
That said, it’s well-documented that it takes more resources to acquire a new customer than to retain an existing one. As such, while nurturing irregular shoppers into repeat buyers is important, fostering loyalty among one’s highest-lifetime value customers is arguably even more important.
As Lamb explained, Teleflora’s efforts to build loyalty have hinged on the brand’s willingness to reorient its approach around customers—their behaviors, their affinities, their preferences—instead of channels.
Building a Cultivation Campaign Geared Toward VIP Customers
After performing an initial survey of its historical data, Teleflora chose to zero in on the top 5% of its customer base (by lifetime value). These VIP customers are incredibly active buyers, often making multiple purchases over the course of a single week.
Teleflora quickly recognized that investing in programs to strengthen these VIPs’ brand loyalty was in its best interest, as losing any of these customers to churn would be a real blow to the brand’s bottom line.
Enter stage right: The Loyalty Cultivation Campaign.
The most effective approaches to cultivating customer loyalty convey genuine appreciation for VIPs. A cultivation campaign shouldn’t be a transaction—e.g. “you spent this much, now you get this reward”—but rather a clear illustration of how much a retailer cares about its VIPs.
To set the endeavor apart, Teleflora adopted an entirely new design aesthetic for its VIP loyalty cultivation campaign. Instead of mirroring the creative it uses for its traditional Monday/Wednesday/Friday promotional emails, Teleflora built its cultivation campaign around creative that resonated with its VIP customers.
It also acknowledged that since many of its VIPs already make multiple purchases per week, it didn’t need to bombard them with daily loyalty-building messaging—sending out communications on strategically selected “off days” would do the trick.
Getting into Customers’ Heads with Advanced Segment-Based Testing
You’re probably wondering how Teleflora knew what kind of creative “resonated with its VIP customers.” In short, segment-based testing.
Teleflora leveraged Custora’s advanced segmentation capabilities to assess how various pieces of creative performed with its different customer segments—from its first-time buyers to its highest-lifetime value VIPs. For instance, Lamb and his team would send a standard Teleflora promotional email to half of a chosen customer segment while sending the other half an email filled with new creative. Depending on how well each email performed, the team would either incorporate the creative into its arsenal or go back to the drawing board.
This process enabled Teleflora to pinpoint specific elements that resonated with certain groups of customers. For example, while some customer segments responded strongly to dollar-off promos, others responded strongly to percentage-off promos.
Similarly, the inclusion of background images in promotional emails had varying effects depending on which customer segment the recipient belonged to.
As these insights piled up, Lamb and his team got a clearer picture of what each of their customer segments wanted from Teleflora’s promotional messaging. As such, when it came time to select creative for its VIP loyalty cultivation campaign, the team knew exactly what it should include to convey genuine appreciation for its highest-value customers.
There’s No “I” in Loyalty
Creating, testing, and running a successful loyalty cultivation campaign is a complex, multi-step endeavor.
As Lamb sums it up:
“It takes a team. It doesn’t take a team to run Custora, but it takes a team to bounce ideas off, to brainstorm, to figure out — and take — each successive step.”
A retailer can’t rely on just its data analytics team or just its creative department. To conduct segment-based testing in a way that lays the groundwork for a successful loyalty cultivation campaign, everyone’s skills are needed.
The best way to foster customer loyalty—among VIPs and among a customer base at large—is to take every opportunity to speak to customers in a meaningful way at every stage of the customer lifecycle, something no single person is equipped to do alone.
This is Part 2 of a two-part series exploring Teleflora’s work with Custora. Click here to read Part 1, or check out our entire conversation with Tommy Lamb here.