Marlon Bowser (HTK Founder and Chief Executive Officer) connected with Loyalty360 recently for a broad discussion, covering topics pertaining to challenges in loyalty, personalization, HTK’s future roadmap – including a clever analogy to explain the connection between CX and loyalty.

What is the biggest challenge and/or opportunity you are seeing regarding customer loyalty and customer experience today?

I think about loyalty like a bank account. Every good experience puts money in, and every bad experience takes money out. The amount of each deposit or withdrawal is proportionate to how well expectations are met.

That’s why CX has taken the spotlight, although it’s really not a new concept. Ten years ago, it was called Customer Experience Management (CEM) but it didn’t really take-off because, back then, people still thought that a loyalty program was enough. Now they know that it isn’t.

People are waking up to the fact that nobody buys four cups of bad coffee because the fifth cup of bad coffee is free.

The knee-jerk reaction to this over the last few years has been to reward customers for engagement, as well as spend. But unless it’s done really well, that can simply lead to a higher financial point liability.

What we’re seeing now is a lot of companies reviewing their existing programs (which tend to be transactional and based around points) and looking towards a fundamental change – although they’re often not sure what that might look like.

How does HTK address these challenges within the industry?

Product quality – whether it’s a good or bad cup of coffee – is up to each business. Where we can help is with the customer experience around those products. What does the journey look like for the customer before, during and after the purchase? When they engage with the brand, are they feeling recognized and appreciated?

These are the kinds of things we’re helping our clients think about – how they can make every interaction more relevant, engaging and valuable, regardless of whether points are involved or not.

Specifically, that means bringing more data analytics and machine learning into our platform, through a new suite of products that are focused on enabling smarter customer experiences across channels.

Relevance and personalization are hugely important to good CX and that requires the ability to analyze and act on data very quickly – which is a capability a lot of brands don’t have. We’re looking to fill that gap with very straightforward products, packaged around commercially viable use cases.

How does HTK approach the popular topics of segmentation and personalization?

In a nutshell, segmentation helps you pinpoint which customers you should be talking to; personalization helps you say the right things, in the right way, to each person within that group.

So segmentation is about predicting trends, understanding which customers are (and aren’t) alike, and identifying those that need attention, to maximize value or reduce churn.

A lot of approaches to segmentation are pretty basic and look only at things like a customer’s location, gender and the products they usually buy. Ideally, though, segments need to consider “emotional” data points, like recent sentiment, alongside “rational” factors such as purchase history and demographics.

Similarly, personalization needs to go beyond the basics and take into account an individual customer’s context to deliver a truly unique experience.

How can we address that as an industry? What does the term personalization mean to you?

Personalization is essentially about knowing “when to sell, and when to serve”, which requires three fundamental things: listening, assessing and doing.

Listening means taking in data about the customer – their behavior, their experience, their sentiment – and using that to build a contextual picture of their relationship with your brand. Assessing is about figuring out the next best action to take, in the moment, based on that data. And finally, doing is exactly what it sounds like – taking the right action, at the right time, on the right channel.

It comes down to “having the conversation that the customer wants to have”. If you’ve let them down, stop your marketing communications for a while; when you’ve fixed their problem, appreciate their patience; when they buy again, thank them for their continued business.