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Amaze Your Customers with These Loyalty Program Techniques

Posted by Bryan Wang

You have a loyalty program. What’s next?

With 83 percent of consumers saying they belong to at least one loyalty program it is important to make sure your loyalty program stands out from the crowd. In the United States of America alone consumers have 29 loyalty program memberships per household.

As such you may be wondering how to jazz up your loyalty program or may be looking for the best implementation techniques.

Here we go over some effective ways to improve your loyalty program.

Surprise and Delight


Consumers love being surprised. It is important to note that rewards that inspire emotions of happiness and satisfaction are most powerful and popular. These kinds of rewards also boost engagement, increasing the chances that the consumer will visit your location or website and actually interact with the loyalty program. One example of surprising and delighting consumers is offering surprise rewards in addition to earned rewards for a customer’s birthday or anniversary or after a certain number of products or services bought. In addition to stimulating feelings of excitement and happiness which the consumer will associate with your brand, the mystery of when the next reward will come will keep customers coming back.

Entice


Another effective technique is to incent the new member upfront with a substantial reward for signing up with your loyalty program in the first place.  An example of this would be offering customers 20% of a next purchase when they sign up for a loyalty membership.  This type of offer spurs engagement and sign up rates amongst consumers. Some businesses also give the customer a number of bonus points right when they enroll, so that they are close to their first reward. This motivates the customer to keep on working towards the reward because they have skin in the game otherwise those points would go to waste.

Loyalty That Cares


Consumers are increasingly concerned with the ethics of their purchases whether that is choosing fair trade products or locally sourced food. In fact 42 percent of American consumers say that would pay more for products and services from brands that have committed to having a positive social and environmental impact. Your loyalty program can reflect this shift in consumer preferences. Partner with organizations that support worthy initiatives and good works such as disease research or natural disaster relief. You can then offer monetary support to affiliated charitable organizations when a customer reaches a loyalty point threshold or buys a certain number of products.  You can also allow members of your loyalty program to convert their points into monetary donation to certain charities or organizations. Emotionally costumers feel more loyal to brand when they believe they are working together with the brand to do good.

Multi-Channel Outreach


Don’t just provide your loyalty program via a plastic or punch card.

With the prevalence of smartphones it is also important to now provide mobile-friendly and online loyalty programs. A multi-channel approach is important because customers now engage with businesses over many channels whether it is a brand’s Instagram account via their smartphone or the official website from their desktop. Also consider social media as another channel through which to disseminate your loyalty program. Social plug-ins that integrate with Facebook, Instagram and Snapchat are a way to simplify the sign-up process – users can sign up and in via their accounts on these platforms. Remember the way you engage with customers changes according to the medium. For example games earn more engagement on Facebook and video on YouTube. Also consider email to foster regular engagement and promote repeat visits to your location or website. However remember that more aggressive tactics such as text reminders or push notifications are still seen as too invasive by most consumers. It is important to ask each of your customers how they preferred to be contacted and use those methods to communicate with them. Communication preferences and other useful information can be easily gathered using an online or mobile enrollment process.

Segment and Personalize


Don’t treat all potential loyalty program members as a homogenous group. Instead differentiate between your customer groups and identify various segments. Even your most loyal customers have different spending abilities and potentials. Tailor your loyalty program to different customer demographics and preferences. This may sound complicated but it is not. If you pick the right loyalty program and loyalty program provider it can be set-up for you. Before Givex’s loyalty program Costa Coffee, the number two international coffee shop operator with over 1200 locations in the UK and more than 600 locations in 25 other countries, did not have much information on their customers.  Costa needed a way to gather data on customer demographics and preferences. They also wanted to detect drops in visit frequency and bring back lapsed customers. To address this Givex provided them with a loyalty program which could be used to collect demographic data and customer contact and purchase information. Via this loyalty program customers were then categorized into different segments.  Using this customer information Costa then tailored a wide range of offers for different customer segments. Variants included double or triple points on next visit, fixed amount of bonus points and more. For more on Costa’s Loyalty Program click here. Having a fluid loyalty program that is tailored to customers’ identified buying habits addresses different segments’ buying ability and engenders greater potential for spending. For example knowing that mothers typically buy 5 coffees for each of the weekdays lets a brand know that offering a free 6th coffee for the weekend can lead to a Saturday visit in which this customer will also purchase a pastry.

Market Clearly and Effectively


The levels of participation in a loyalty program are connected to how well you communicate about the program.  Being straightforward and clear as to how the loyalty program works and the benefits associated with it for the consumer is the best way to go. Make sure your loyalty program is mobile and accessible through a smartphone. Consumers increasingly engage with brands while they are on the go and on their tablets or smartphones. Make sure your website is responsive and works across a range of devices. Ensure customers can easily access information on their points balances and rewards online. Use their preferred communication methods (whether email, direct mail) to send them offers and remind them of rewards. Keep customers informed and thus engaged. Remember it is unlikely that customers will seek out loyalty program information actively themselves. Beyond this make sure your staff is knowledgeable about your loyalty program and can clearly answer questions or explain benefits. Also advertise your program abundantly throughout your store locations. Shoppers Drug Mart’s Optimum program, for example, is clearly publicized via emails describing current offers and reward points denoted on item price-tags in-store.

Measure Impact


One often overlooked element of loyalty program success is measurement of impact and effectiveness. How well is your loyalty program doing? Is it having an impact on sales and profit?  Keeping track of metrics such as reward redemption rates and how loyalty is affecting other business areas – such as sales - is key. This information can help you make key business decisions.  Again with the right loyalty program provider this is easily implemented for you. Mondou, a Canadian pet goods retailer, used their Givex loyalty program to collect customer data but also to see how their loyalty program related to sales.  By matching customer data with SKU data, Mondou identified which SKUs were most popular with customers and which customers purchased the highest amounts. This lead to further development of their private label brands which positively impacted sales and provided  a deeper understanding of their most valuable, profitable and loyal customers.  Mondou also received detailed reports with easy to understand statistics and information on how their loyalty program was doing and its impact on profits.

Employ these techniques to see greater loyalty program success!
 

Topics: Loyalty