I came across a very interesting article that I believe is quite relevant to the

Question

I came across a very interesting article that I believe is quite relevant to the information systems class and the idea of giving up more information in order to get the ease of access to certain things or a more personalized service. What is more effective?

Here's a link to the article!

https://www.bloomberg.com/news/articles/2018-06-15/free-food-for-personal-data-is-a-trade-some-diners-won-t-make?cmpid=socialflow-linkedin-business+&utm_medium=social&utm_content=business&utm_source=linkedin&utm_campaign=socialflow-organic

Explanation / Answer

Q1) What is more effective?

Instead of giving up more information in order to get the ease of access to certain things or a more personalized service, I believe the following are more effective which will not only keep Customers data private but also fetch revenues from them without having to trade with Customer centric data:-

Offer a discount or credit to return - Generally, I would tell you to be wary of discounting. When you discount your products you enter a perpetual race to the bottom that conditions customers to expect dropping prices, which ultimately results in a loss of revenue for your store. When margins are tight, discounting is even more of a risk. However, when discounts are sent to a first time buyer I actually love it! Sending a discount code for their next purchase with a first time order is a great way to nudge them to come back. For this reason, discounting can also be an effective way to bring back customers that haven’t purchased in a while.

Send engaging emails to customers - If purchase frequency is the backbone of customer retention, email marketing is the backbone of your retention toolkit. Emails give you the opportunity to continue building a relationship with your customers before and after their initial purchase. It’s critical that each message you send adds value to your customer’s experience. If it doesn’t, you run the risk of losing them.

Start a customer loyalty program - Loyalty programs are an effective way to increase purchase frequency because they motivate customers to purchase more often in order to earn valuable rewards. This becomes a profitable exchange for both you and your customers: they get more value each time they shop, and you benefit from their repeat business. You can encourage customers to continue investing in the program by giving them welcome points when they create an account. When they see how easy it is to earn rewards, they’ll be excited to come back to your store to do it again. Creating a loyalty program can be as simple as rewarding customers on their second purchase, or after a set dollar figure. Your store reports make it easy to see who your best customers are by dollar value and total number of orders. Additionally, you can opt for automated loyalty apps which can reward your customers for a variety of actions they take in your store.

Please let me know in case of any clarifications required. Thanks!

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