Building Data-Driven Loyalty with Predictive Analytics | Yotpo

Last updated on February 6, 2023

Lindsay MacDonald
Content Manager @ Yotpo
April 29th, 2020 | 4 minutes read

Introducing Repeat Purchase Prediction within Segments Plus, the first predictive analytics-driven segment in our Loyalty & Referrals solution. 

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Consumer intent can be hard to understand. Without a data-driven loyalty program to help you draw insights from consumers’ purchasing behavior, your brand is stuck guessing which growth strategy might work best — resulting in lower efficiencies and high, unsustainable customer acquisition costs.

Today, a loyalty program can benefit dramatically from artificial intelligence. With smart insights that can analyze a comprehensive database of customers’ purchasing behavior, user-generated content, and loyalty program participation, your brand can predict the data you don’t yet have — like a customer’s likelihood to purchase again (or their likelihood to churn). 

Introducing Repeat Purchase Prediction, part of Segments Plus and the first instance of our predictive analytics engine built on proprietary eCommerce data. Now your brand can automatically interpret the customer data you collect — and you can send more intelligent and relevant offers to shoppers based on where they are in their buyer’s journey. 

How does Repeat Purchase Prediction work?

Prior to Repeat Purchase Prediction, we could guess future customer behavior using demographics data and purchasing history. We could enable your brand to suggest relevant products and send offers when it might be time for a customer to purchase again. 

But, we were always guessing. Now, we’re predicting.

Our Repeat Purchase Prediction model has analyzed millions of orders and customers to track how they’ve actually behaved. Rather than doing guesswork, the algorithm uses that data to assign a repeat purchase probability score to each shopper to indicate how likely that shopper is to make a purchase in the next 90 days. 

There’s a lot more nuance to how people shop than just logging into a loyalty program and making a purchase. With Repeat Purchase Prediction, your brand can get so much closer to really understanding shoppers’ intent, ultimately improving customer engagement, mitigating high customer acquisition costs, and increasing revenue. 

How do predictive analytics improve your loyalty program?

Customer retention is the ultimate growth hack and the best antidote to rising customer acquisition costs (CAC). With the data you collect with Segments Plus, your brand can make better, forward-thinking decisions that lower those acquisition costs — a necessity as they only continue to rise

With Repeat Purchase Prediction, your brand can target your existing customers and loyalty members at the optimal re-engagement point in their buyer journey, so you can drive conversion and brand advocacy.

Using AI to predict your customers’ next purchase makes the list of potential segments you can create endless. Here are a few examples to get you started. 

  • You’ve launched a new product, so you send an SMS message giving early access to engaged customers who are extremely likely to purchase again and have bought newly launched products in the past.
  • You’re looking to promote your higher-margin product lines, so you create a segment of customers highly likely to purchase and offer them 10% off those products.
  • Your brand is looking to prevent customers who are very unlikely to purchase from churning, so you send them an email with a one-time BOGO discount on products they might be interested in based on past purchases.
  • You have a big seasonal holiday sale coming up, but you don’t want to offer discounts to customers who are already highly likely to buy. So, you remove that segment of customers from your discount-heavy promotional emails.

Without predictive analytics, you wouldn’t be able to make these decisions.

How to get started?

Log into your Yotpo Loyalty & Referrals account and select “Segments Plus” under the Customers tab. Under Filters, you can select Repeat Purchase Prediction to toggle between Scores 0-4 alongside your other Segments Plus filters and run reports.  

For more information, talk to your Customer Success Manager or read our article on using segmentation to create stronger loyalty programs