How Does Product Authentication Improve Customer Retention and Experience

If you are a brand owner, you are certainly aware of how challenging it is to build and maintain customer engagement. Especially in the competitive market today, where customers can effortlessly choose from an array of options with a mere swipe, gaining their attention and loyalty is demanding.

Product authentication is a crucial element many brands overlook in their strategies to enhance engagement. Leading companies like Pepsico have successfully integrated authentication solutions with customer engagement strategies to significantly improve the overall customer experience, leading to higher retention rates and increased loyalty.

Why Does Customer Retention Matter?

Acquiring a new customer is significantly five times more expensive than retaining an existing one. To get more interesting, a mere 5% increase in customer retention can lead to a 25-30% increase in revenue. These statistics underline the value of focusing on existing customers to maximize profit margins with minimal costs.

But what drives customers to make repeat purchases? Several factors play a role, including product quality, pricing, accessibility and the online shopping experience provided by the brand. Above all, treating customers as a personal being rather than just a number plays a great role. Over 84% of customers wanted to be treated as a person, interact and engage with them.

How Does Product Authentication Improve Customer Engagement?

Are you 100% certain you bought an authentic one every time you go shopping?

Product authentication brings you that peace of mind. Product verification is not just a recommendation; it is becoming a necessity. Customers are increasingly concerned about the authenticity of the products they purchase. Interestingly, they prefer brands that provide clear and verifiable proof of authenticity. Product authentication solutions, such as unique security codes, enable customers to verify the genuineness of a product easily.

Answering the Sustainability and Ethical Practices Queries

Product sustainability is a growing concern in the 21st century. From December 2024, the EU Deforestation Regulation has mandated products belonging to 30 different categories to furnish their transparency report. Aiming to prevent deforestation and other environmentally hazardous practices, the new regulation is expected to create waves in global trade.

But not just the authorities.

Consumers are becoming more ethically conscious, questioning the sources of ingredients and the ethical standards of brands. They are more likely to engage with and remain loyal to brands that demonstrate a commitment to sustainable practices. Product authentication allows brands to transparently share information about the origin of their ingredients and the ethical practices involved in their production processes.

Choosing The Authentication Solutions for Your Brand

It is essential to choose authentication solutions that best suit the specific needs and requirements of your brand. Consider factors such as the nature of your products, your target audience and your overall business objectives. There are various solutions available for product authentication, each with its own advantages and applications.

1. QR Codes

QR codes are a popular and versatile authentication solution. Gathering popularity during the pandemic era, they made an even better comeback in the authentication realm. Having the advantage of easily scanning using a smartphone, they became the go-to measure for providing instant verification. QR codes can also link to additional information about the product or take the customers to any designated page to enhance customer engagement.

2. Holograms

Holograms are one of the widely utilised product authentication solutions. They offer a visually striking method of verification that is difficult to replicate. Apart from visual identification, tamper-evident holograms leave behind residues if the label or product is tampered with, offering a clear and visible indication of authenticity and adding an extra layer of security against counterfeiting.

3. Blockchain

Blockchain takes authentication a step further. Over verification, blockchain technology offers a decentralized and tamper-proof method of tracking your product. It ensures that every step in the supply chain is recorded and cannot be altered, providing a reliable solution to uphold transparency and traceability. Global brands like Walmart are using blockchain technology to track their agriculture products and food products from sources to shelves.

Prioritising Authentication to Restore Trust.

Counterfeits can easily break your customer's trust in your brand. Keeping the market and your customers away from fakes is a necessity for your functioning. Apart from fighting counterfeits, employing authentication solutions helps you project your willingness to protect your customer's safety and uphold their interests. This benefits your audience in numerous ways.

1. Customer Satisfaction

The peace of mind customers get knowing they bought an authentic product is priceless. Ensuring that customers receive authentic products enhances their satisfaction and fosters loyalty. They associate authenticity with your brand. When customers know they can trust the quality of a product and the brand, they are more likely to become repeat buyers.

2. Providing Tangible Proof of Genuineness

Tangible proof of genuineness, such as QR codes, holograms or serial numbers gives customers confidence in the authenticity of their purchase. This tangible proof can significantly enhance the customer experience by providing peace of mind.

3. Understanding Sustainable Practices Followed

Providing transparent information about the sustainability measures taken allows your brand to engage environmentally conscious consumers and build stronger relationships with them.

Motivate Customers to Take the Extra Effort

At a glance, product authentication may look promising, and immediate with substantial results. However, the reality is far more complex. How does your brand plan to motivate customers to take the extra step of scanning a product label? How have other brands achieved this? Is your goal merely to encourage interaction, showcase product quality, or reward customer loyalty? These are critical questions that brands need to address before embracing authentication solutions.

Motivating customers to take the extra step of verifying a product’s authenticity can be challenging. Brands can encourage this behaviour by making the process simple and rewarding.

Incentivizing the Effort

Customers love it when they are offered incentives for any extra effort put in. Offering incentives is an effective way to motivate customers to verify product authenticity. These incentives can include discounts, exclusive offers or access to premium content. Amalgamating product authentication with rewards and loyalty programs can significantly enhance customer engagement.

Reward your customers for verifying products and provide them cashback, loyalty points or other gift vouchers. Build stronger relationships by prioritising your customers and valuing the time and effort they put in for your products. Another major advantage of providing incentives is the valuable data on customer behaviour you can gain. Analyzing this data allows you to gain insights into customer preferences and purchasing patterns, which can inform future marketing and product development strategies.

Tracking Customer Behavior to Enhance Personalization

Personalisation is the new normal in 2024. Marketing and product design are centred on personalising each step to be tailor-made for each customer. Why? Studies show that 63% of customers stopped buying from brands that don’t engage with them personally.

The abundant data collected through product authentication can be used to refine and improve both products and branding strategies. Understanding customer preferences and behaviours allows brands to tailor their offerings to better meet customer needs. Customization based on real-time insights ensures that brands remain relevant and competitive.

W.O.M For A Solid Audience

Satisfied customers are likely to share their positive experiences with others. When customers appreciate the authenticity and quality of a product, they can become brand advocates, spreading word-of-mouth awareness about the brand’s commitment to authenticity.

Engaging Customers is not Impossible

Yes, there are challenges to implementing these solutions but the benefits far outweigh the difficulties. It is two birds in one stone practice. Brands that successfully integrate authentication measures into their customer retention strategies will not only enhance customer trust and loyalty but also gain a competitive edge in the market. If you are wondering where to start with your product authentication strategy, get in touch with us. Acviss has been instrumental in devising and implementing brand protection and customer engagement for over 8 years. Join a league of global brands and secure your growth today.

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