If driving revenue growth is the end goal, then improving the attach rate is one of the strategies to get there. Attach rate or product affinity refers to additional items that are added as part of the checkout process. This often forms part of a cross selling or upselling strategy to drive average order value (AOV) and customer lifetime value (CLV). This has to be well thought out and an integral part of the customer experience (CX).
Too often brands embark on a growth strategy that targets improving attach rates and product affinity, and in attempting to get customers to buy more, they end up alienating and annoying them instead. Rather than building the CLV, this results in shopping cart abandonment and churn which cancels any revenue gains achieved. What should brands be focusing on that will improve CX and attach rates?
Imagine you’re traveling for work and shopping online for a carry-on bag that’ll house your laptop and in-flight essentials. The process is effortless enough and the next day the bag is delivered to your door. What a great customer experience… and then things start to go wrong. Daily you’re bombarded with email offers on bigger travel bags, different travel bags, branded bags, or worse a discount for the bag you just purchased. It’s almost as though the company doesn’t realize you’ve already made the purchase. They’re still treating you as a prospect. Somewhere between signing onto the website and checking out, there’s nothing connecting the dots and indicating a different nurture stream to grow CLV.
Another example is when a customer buys a major appliance like a washing machine. Whether they’ve saved up for months, or are simply upgrading, it’s a one-off purchase that’s expected to last for many years. Making offers on other major appliances such as a dishwasher may seem logical, but the reality is that most people can’t afford to or need to buy multiple major appliances at a time. A better approach would be to offer an extended warranty, a choice of washing baskets for sorting clothes, containers for detergents, pegs or softeners, or even a portable clothes drying rack. They may not have the same price tag as a major appliance but they do add value to customers and have the potential to improve attach rate and CLV, not to mention the overall experience.
Understanding what will improve CX is essential if brands wish to generate more value through improving attach rates. It’s about much more than identifying products that have an affinity to what customers are looking for or have already purchased.
The fact that so many brands get it wrong is an indication that they’re not utilizing the customer data they have in order to deliver better digital experiences. In their defence, there is a lot of data and it’s constantly changing because customers have different preferences and these shift over time. This is where leveraging artificial intelligence (AI) can have a profound impact and enable brands to serve up relevant offers that can increase both AOV and CLV.
AI has the ability to leverage customer data to generate better CX and identify which products or services customers are responding to, in order to improve attach rate. This process of AI-driven optimization identifies key elements on a page that could be changed in order to improve the digital experience and move a visitor further along the customer journey. It then iterates multiple ideas, variations and combinations of those ideas to serve up unique experiences to each visitor.
What’s really valuable is that the live visitor responses directly inform the top performing ideas and provide brands with meaningful insights as to what products or services and which experiences customers value. Being able to serve up relevant product or service suggestions that genuinely add value improves customer experience, which in turn can improve attach rates and in turn increase the AOV. AI-driven optimization also gives brands a competitive edge by enabling them to respond quickly to changing customer preferences and market trends. More importantly, it reduces the chance of brands getting it wrong and annoying customers because the insights are based on actual visitor responses that deliver better CX and business outcomes.