How to Turn a Shopper into a Loyal Customer with a Loyalty Program

Between national brands encroaching on one another’s territory and the convenience of eCommerce, consumers have more choices now than ever. They are often motivated by price rather than experience, jumping ship to the retailer with the cheapest products until they can find them somewhere else for cheaper.

Brands that want to keep hold of their customers must be able to provide some sort of incentive other than being the most aggressive faction in a price war. That is where loyalty programs come in. There are over 2.6 billion loyalty program memberships in the U.S. as of November 2014 — enough to account for 11 memberships per adult. Total membership also rose by 26.7 percent between 2012 and 2014.

In other words, these programs are popular, and their popularity is only growing. Here are some suggestions for utilizing your loyalty program in a way that maximizes its effectiveness and forges deep, lasting customer loyalty.

Keep It Simple

Too many loyalty programs are difficult to sign up for, and others make it too difficult to track your progress or fail to adequately explain how the rewards process works. Brands can connect their loyalty programs to customers more effectively if they make the process of engaging with the loyalty program as straightforward as possible.

Using a polite form of the old adage: keep it simple, silly!

  • Make it clear to customers what they will get when they redeem their loyalty points so they can know what they are building up to. By keeping their “eyes on the prize” they can be more motivated.
  • Track their progress for them visibly through tier systems, charts or graphs so they can see their “loyalty equity” build in exciting ways.
  • Make sign up as simple as possible. Have them fill out their information in more detail later if your need more data on them, such as when they go to redeem their reward.

Keep Them Engaged

Loyalty research institution Colloquy revealed recently in a study that 58 percent of loyalty program members do not actively participate in their programs. Brands can do several things to keep them coming back for more:

  • Send push notifications, SMS or email to remind them about the program
  • Change your rewards frequently to give them something new worth getting excited about
  • Have accumulated points expire after a certain period to drive impulse purchases towards the end of the “loyalty term”
  • Add some incentive points or send a personalized message to people who are inactive for six months or more at a time

Make It Multi-Channel

97 percent of loyalty program rewards are triggered by purchases alone, according to Capgemini Consulting. The other rewards activation categories are far more measly:

  • Only 16 percent are based on activities
  • 14 percent on gamification campaigns
  • 6 percent on mobile app downloads
  • 4 percent social media engagement
  • and a paltry 2 percent reward in-store check-ins

Brands can leverage a lot more engagement from their customers if they meet people where they frequent, not just merely waiting for them to come to your store. Having a social media presence invites opportunities for customers to interact with your brand online and spread reach. Mobile app downloads let them receive push notifications and have a lot more tangible way to track loyalty progress.

Aspects like store check-ins can be accomplished automatically through beacons so that simply visiting the store is a reward in itself. Store beacons can also help make gamification easier, such as sending customers on a “scavenger hunt” to view all the new promotional displays in one visit.

Offering a multitude of experiences beyond mere purchases makes the loyalty program more dynamic and exciting while also giving customers more reasons and opportunities to stay engaged.

Hang on to Customer Data and Always Be Improving

Beyond sales lift and fostering affinity with customers, loyalty programs are also powerful data-generation tools. Make sure that you are capturing this valuable data and using it to inform marketing decisions as well as facilitating more personalized, one-to-one experiences.

Digital Social Retail’s digital convergence platform can make it easy for brands to create mobile-optimized experiences while also spreading multi-channel communication across social touch points. Loyalty functions can even be tied to beacon platform software, so that in-store experiences are just as dynamic as the ones online. All the while, the software gathers data that can be viewed from anywhere and is presented in an easy-to-digest analytics dashboard format.

Let us help you unlock the potential of your loyalty program and tie it into digital marketing advances for the modern age. Visit our product page to learn more.

Loyalty programs are popular and growing. Here are some suggestions for utilizing your loyalty program in a way that maximizes its effectiveness and forges deep, lasting customer loyalty.

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