Loyalty programs offer customers incentives for repeated brand interactions. The increasing sophistication of technology management resulted in the diversification of program structures. Companies, especially smaller ones, seek ways to minimize enrolment friction, reduce program costs, and adapt to loyalty campaigns that promote their competitive advantage.
The long-term success of loyalty programs depends on the perceived benefit to the customer. What two customer customers want varies significantly. The capability to offer multiple incentives and adapt existing incentives makes it easier to entice more customers into the program. Different loyalty strategies include:
- Collect points for purchases and then get discounts in the future.
- Tier customers to give the best rewards to the most loyal.
- Support charities that aspire to the values of clients.
- Reward the amount of spend over a period of time, including one or multiple purchases.
- Lottery or gaming strategies add entertainment to the program.
- Free perks that offer the customer additional product or services.
- Community groups give clients access to company expertise.
- Referral programs reward customers for helping to bring in a new client.
The business value of a loyalty program ties into the overall marketing plan. Typical benefits to the business include:
- Collect email addresses and phone numbers for text messages used in future campaigns.
- Collect marketing intelligence.
- Liquidate dead stock.
- Upsell merchandise and services.
- Promote affiliate marketers and company advocates.
- Market test new products or collect feedback from specific marketing segments.
- Validate the marketing segment before extending investments.
Effective marketing is about return on investment. Reducing program costs always increases the value.
- Marketing to loyal members through email and text costs less than advertising through 3rd parties.
- Reuse data-driven marketing solutions for the loyalty program. That is to say, tracking any user navigating a website is the same regardless of having a user account for them.
- Use cloud technologies to reduce the capital and licensing investment to launch a program.
- Use modern technologies like cell phones over old school methods such as loyalty cards.
- Autofill the email address and phone number in the browser.
- Link auxiliary data with the user account, including language preferences, geolocation of IP addresses, and browser technology.
- Tie upselling and discounts to user accounts that show up throughout the website.
- Refine offers based on browsing history.
- Collect contact details based on events.
- Provide immediate discounts during checkout for loyalty sign-up.
- Print QR codes onto in-store receipts to claim points.
The advent of cloud technology levels the playing field by giving smaller companies access to the same technology as the largest enterprises. The only limitation is creative and technical abilities.
- Make one-on-one offerings based on browsing history and prior purchasing.
- Customize loyalty programs based on the marketing segment assigned to the customer.
- Let the customer select their loyalty program.
- Quickly update in-store and online receipts with promotions.