The ability to measure the effectiveness of your clienteling efforts provides important insight into the type of customer experience you are attempting to create.


The concept of clienteling, sometimes referred to as personalization, is one of the most important and effective retail strategies you can implement, as a positive customer experience is now the dominant differentiator among retailers. So it’s equally important that you accurately define and measure your efforts. 

Clienteling is a technique used by retail sales associates to establish long-term relationships with key customers based on data about their preferences, behaviors and purchases (Source: Wikipedia)

The actionable part of clienteling, designing specific campaigns, promotions, interactions, and experiences with your customer is just one part of whole process. In this article I will share what I think are the most important measures and help you align them to specific clienteling processes.

Clienteling Process

Let’s start with the typical process so we can align the measures appropriately. It looks something like this:

  1. Consolidating and harmonizing your customer information. In the customer relationship management (CRM) world, this is referred to as the customer account records, or CAR.
  2. Customer segmentation. Grouping your customers by personas can be very helpful if you’re dealing with large numbers. Ultimately, it comes down to the type of campaigns you want to implement whether they need that individual touch or whether they can be treated equally within their persona group.
  3. Business Strategies. In order to effectively and accurately determine if your program is successful you need to define the type of strategies you intend to deploy. For example,
    • Reward Customer Loyalty
    • Reduce Customer Churn
    • Win Back Customers
    • Cross Sell and Up Sell
    • Win New Customers
  4. Create Campaigns. These are promotions, interactions, and experiences you will design that meet the business strategies you defined above. This can be a lot of fun, especially if you implement simple analytics like Bayes’ theory to predict how your persona or individual customer is likely to react. Here are some examples:
    • Buy One, Get One (BOGO)
    • Point Redemption
    • Friends and Family
    • Percentage Off
    • Exclusive Events
    • Runway Invitation
  5. Delivery. Now you have the strategies and the campaigns. It’s time to interact with your customer. There are many ways, but throughout the campaign it is important to think about how you will track these interactions so you can associate them with the sales transactions.
    • Email
    • Direct Phone Call
    • Traditional Advertising: TV, Radio, Newspaper, Blog, E-commerce sites, Event Sponsorship
    • Social Media
    • Podcasts & Videos
  6. Measure. During and after the campaign you can track the effectiveness against your forecast or plan.

Top Line Measures

Ultimately, there needs to be a reconciliation to the most important financial metrics in retail; namely,

  • Sales
  • Gross Margin Dollars
  • Gross margin Percentage
  • Inventory Turnover
  • GMROI (GM $ / Average Inventory at Cost, or Turnover x GM%)

When it comes to measuring a persona group or an individual customer there is only one measure at the top and that is customer lifetime value, or CLTV.

The Actionable Measures

The actionable measures are calculations, or KPIs, that are used to leverage the top line line measures above. The four most common for both e-commerce and brick-and-mortar are:

  1. Conversion. Conversion which equals Transactions / Traffic is used to determine how many customers that visit your store or website complete a sales transaction. Other related concepts to conversion are:
    • Time of Year
    • Time of Day
    • Affinity
    • Substitution
    • Halo Effect
  2. Average Units per Transaction (AUT). The AUT measures the average number of units purchased during the campaign. Your ability to increase this value will directly impact the sales. Typical concepts used to affect this KPI:
    • Cross Selling – on average, your ability to get customers to buy across different categories.
  3. Average Value per Transaction (AVT). The AVT measure the average value per transaction, in whatever currency you’re using. In North America this is sometimes referred to as the ADT, or average dollars per transaction. Typical concepts used to affect this KPI:
    • Up Selling – on average, your ability to get customers to trade up to a higher priced item or service
  4. Traffic. For on premise sites, like stores and pop-ups, traffic usually refers to the traffic out of the store to help avoid problems with counting store associates that enter the store. For e-commerce, this usually refers to the unique visitor count, or the overall visitor count. For obvious reasons, your ability to increase traffic will have a direct, or linear, impact on everything else. Programs that help increase traffic:
    • Referrals – sometimes referred to as the net promoter metric is a customers willingness to refer their connections to your store or site
    • Customer Retention – Keeping track of customers that are active or dormant can have a profound impact on the effectiveness of your campaign if it’s tailored correctly.

Using these measures will help you improve customer experiences and ensure your business objectives are being met.