1. Do you know your customer's birthday?

Use the magic of behavioral and data science to make your brand memorable on your customer's special day.

I received many heartwarming wishes on my birthday - from my bank, my grocer, my dentist, and even Changi Airport, who tried to make me feel special.

It made me think about how birthday messages are a powerful way of using data and behavioral science to grow brand loyalty. 

Many eons ago, when I was doing my master's degree in decision sciences, a subject specializing in using data and behavioral insights to understand how humans make decisions, my favorite subject was 'nudges' - an idea popularized by Nobel prize winner Richard Thaler, showing how simple interventions can help people make better choices.  

And a customer's birthday is one of the best occasions for nudging them - after all, who doesn't adore a delightful surprise on their special day? 

The behavioral science behind customers' birthdays combined with their transaction and demographic data is a powerful ammunition to create a personalized experience that the customers will likely remember - especially if they were not expecting it.

I was surprised to receive a birthday greeting from Changi Airport, and the next time I visit Singapore, I will likely remember this email. Pleasantly surprising a customer creates strong mental availability - which, according to Prof. Byron Sharp's research, is one of the strongest predictors of a brand's growth. 

Research on consumer behavior shows that personal milestone dates are a very effective way to nudge people to action. Birthdays, apart from the start of the new year, are also days when we often "audit" the meaningfulness of our lives and look forward to making positive changes. 

Milestone birthdays, such as the start of a new decade, are significant as they help us demarcate a "fresh start" opportunity. A study on marathon data found that runners ages 29 and 39 finished in better time than when they were younger (27 and 28, or 37 and 38) as the prospect of a big birthday pushed them to train more. 

Source: www.lovekates.co.uk

Research done at Duke University showed that the effects of a marketing campaign for homeowners that specifically mentioned an impending milestone birthday were higher than those of a campaign that did not. 

Given these valuable psychological triggers, if you have the customer's birthday or age data, you can leverage it in the following ways -

• Segmentation: By analyzing the age and birthday data, you can categorize customers into different age groups or cohorts and use this information for personalized recommendations and experiences

• Targeted Campaigns: This segmentation can be valuable for specific promotions or products targeting other age groups based on their preferences and behaviors.

• Predictive Modeling: Incorporating age and birthday data into predictive models can help forecast customer behavior. For instance, predicting the likelihood of a customer making a purchase, churning, or responding to a particular marketing campaign could be influenced by their age.

• Customer Lifetime Value (CLV): Understanding the age distribution of customers is crucial for estimating the CLV. Different age groups may exhibit distinct spending patterns and loyalty levels, which can be factored into calculations to determine the long-term value of a customer.

Many other behavioral science concepts are related to age - for example, older cohorts may be more prone to status quo bias, preferring to maintain current conditions rather than change. In contrast, the younger cohorts might be more susceptible to novelty bias, seeking new and different options. Older adults tend to be more risk-averse than younger individuals. This can be seen in contexts such as better loan repayment behavior among older segments.

Life milestones, like birthdays and significant ages, play a major role in shaping consumer behavior. Integrating this understanding into your customer lifecycle management strategy will help you craft highly personalized customer experiences that resonate deeply with individual preferences and moments in their lives.