Unlocking Loyalty with AI: Personalized Service for VIP Customers
Company: Farfetch, Global Luxury Platform
Role: Senior Global Director, Service Design
Focus: AI, Service Design, Customer Support, Loyalty Tier Differentiation, Customer Journey Design & Management
Customer: B2C
Industry: Tech/ eCommerce Platform/ Digital Marketplace
You only get one chance to make a first impression. That impression becomes more critical for your highest potential high spenders. But how can you identify those high potentials when they have never been your customer before? That’s where AI comes in. Through pattern recognition across millions of previous global orders, we worked with our Data Science team to develop an algorithm that would identify common buying behaviors of VIP customers from their first purchase.
So how can you ensure that your newest potential VIP customers get the VIP treatment? Give them their own personal service advisor. While the robots run the algorithms and process automation to speed up analysis and take over transactional tasks, service teams become more valuable, focusing upstream value-add touch-points and less on reactive tasks. Need a stunning dress for that wedding? Size advice for those Gucci flats? Want to be sure you’re home in time to receive your new Balenciaga bag? You’ve got a butler for that.
This new service role, not only elevates the new VIP customer shopping experience and facilitates faster access up loyalty program tiers, but it also gives customer support staff a new, more exciting purpose - doing what only they (humans) can do best - offering empathetic, creative solutions to anticipate customer needs. Keeping your best customers and employees happy, driving retention inside and out.
Personal Service Advisor
Goal & Concept:
As self-service and robotic process automation was introduced, the Customer Service (CS) role began to evolve. Opportunity was created for CS advisors to use their skills for more high-value touch points further upstream in the shopping journey.
Based on luxury customer research, recently completed by my customer research & design team, and some known challenges in the customer journey, as identified by our “Customer Experience Index”, the Personal Service Advisor concept offered a concierge-like proactive service to new high-potential customers to ensure a smooth first purchase experience.
Designing & Testing:
We started with a low-fidelity proof of concept prototype to test the hypothesis that by applying our new algorithm aimed at identifying high-potential VIP customers, we could encourage repeat purchases with personalized, proactive support from our customer service team and channel more VIP customers to our Private Client (VIP Sales) team.
The pilot started with 3 advisors in the United States and Mexico as set out to prove the concept with a 6-month test aiming to answer 2 questions:
1) Would participating customers move up the loyalty tiers to VIP more quickly than those not participating (control group).
2) How much more would participating customers spend?
3) What would be the impact on cost metrics? (Returns, etc)
Channel Limitations –
There were immediate challenges to roll out as the preferred customer channels that our research indicated were unavailable due to technical constraints and conflicting roadmap priorities. We quickly pivoted to using the available channels - phone and email - to test proof of concept.
As we had expected, this made first contact a bit more challenging as neither phone or email had tested to be the most successful channels for early engagement. Email proved to be more successful than phone for first contact. Once advisors were able to reach customers with the service offering, we quickly met our engagement targets.
Early Feedback & Iterations
Only 5 in 300 customers responded when invited to the program by phone.
CS Advisor feedback & surveys created opportunities for iterative improvement.
We were able to increase participation x 10 by switching to email outreach.
Results:
Results from the small scale pilot were promising. Participating customers shared feedback that they found great value in the personalized service offering, forming bonds with their advisor that led to repeat purchasing at a faster rate than the control group. The cohort moved more quickly through the loyalty tiers as they spent more frequently more quickly. Qualitative feedback indicated a strong desire to remain in the program. The Personal Advisor Service became a key pillar of the broader service elevation program aimed at differentiating the loyalty program offerings. We entered further testing to scale the service with preferred communication channels.
Increase in repurchase rate among participants due to upselling and post-cancellation service support.
Reduction in returns due to size and fit support and personalized recommendations.
Incrcease in VIP tier entry within 6 months. Participants achieved VIP status 3x faster than the previous average.
CSAT score for participants, 5 % pts higher than the global and 9 % pts above the regional scores.
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