SOURCE: Aberdeen Group

Aberdeen Group

November 12, 2009 10:00 ET

Personalization-Driven Customer Loyalty Process Transformation High on the Agenda for Top Performing Online Commerce Organizations

Sixty-Nine Percent of Top Performing Online Commerce Organizations Are Utilizing Personalized Promotions for Returning Customers to Strengthen Brand Loyalty

BOSTON, MA--(Marketwire - November 12, 2009) - The recession is turning the focus of online commerce organizations away from overreliance on net new customer appeal and towards maximizing existing customer value. According to a report from Aberdeen Group, a Harte-Hanks Company (NYSE: HHS), 42% of top performing online commerce organizations have a formal online loyalty program in place for more than two years, and 63% of these same organizations consider the expectation of a highly personalized experience to be their number one online loyalty-related business pressure. The report, "Online Customer Loyalty: Converting Occasional Shoppers into a Loyal Customer Base," details the business benefits derived from upgraded e-commerce performance and cost optimization.

According to Aberdeen data, as a means to increase the overall value of existing customers, top performing online commerce organizations are taking a two-pronged approach to conversion and retention. First, these organizations are implementing a formal online strategy that rewards the shopping experiences of existing customers with points or similar credit system. Second, these same organizations are using proactive market personalization and effective post-purchase support to bolster their formal efforts with increased customer touches.

Given the challenging economy categorized by decreased consumer spend, and given the ultra-competitive online environment, it seems logical that e-commerce organizations are turning towards maximizing existing clients versus relying on new opportunities to present themselves.

"Top performing organizations have realized that increased customer touches before, during and after an online transaction is key to increasing the value derived from existing customers. These touches come from a combination of effective customer loyalty strategies such as point redemption and effective personalization though the customer buying lifecycle. In an economy where the customer has more options and less available spend, online commerce organizations will be judged not only on what they sell, but the strategies they use to sell it," says Greg Belkin, chief author and e-commerce analyst, Aberdeen.

Aberdeen has found that top performing online commerce organizations are prioritizing customer loyalty all throughout their enterprise. Sixty-one percent of these top performers are incentivizing their employees to increase sign ups for customer loyalty programs. At the same time 44% of these same organizations are also incentivizing repeat customer rates among merchandisers, marketers, and post-purchase support staff. This strategy helps organizations increase effective customer touches both from two perspectives: formal loyalty programs and advanced personalization strategies. The former includes point-based redemption programs, customer experience and customer relationship management, while the latter includes utilization of personalized promotions, email marketing, merchandising, site content display, and search optimization.

"Online loyalty systems and personalization strategies work in tandem for increasing customer value," says Belkin. "The smarter and more exact these strategies are when it comes to servicing the specific needs of a customer, the higher the overall lifetime value will be from their customer base."

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About Aberdeen Group, a Harte-Hanks Company

Aberdeen provides fact-based research and market intelligence that delivers demonstrable results. Having queried more than 30,000 companies in the past two years, Aberdeen is positioned to educate users to action: driving market awareness, creating demand, enabling sales, and delivering meaningful return-on-investment analysis. As the trusted advisor to the global technology markets, corporations turn to Aberdeen for insights that drive decisions.

As a Harte-Hanks Company, Aberdeen plays a key role of putting content in context for the global direct and targeted marketing company. Aberdeen's analytical and independent view of the "customer optimization" process of Harte-Hanks (Information - Opportunity - Insight - Engagement - Interaction) extends the client value and accentuates the strategic role Harte-Hanks brings to the market. For additional information, visit Aberdeen or call (617) 723-7890, or to learn more about Harte-Hanks, call (800) 456-9748.

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