You Can’t Buy Customer Loyalty, but You Can Win It

For a leading consumer brand with millions of customers, staying relevant is an overwhelming proposition. Steven Dunston, VP Marketing, Amplero, explains three ways through which leading brands can keep their loyalty programs relevant.

Consumers can’t simply be bought anymore. In fact, 71% of consumers now claim that loyalty incentive programs don’t make them loyal at all, according to recent consumer research from Kantar Retail.

THE NEW RULES OF (MULTI-CHANNEL) CUSTOMER ENGAGEMENT: HANDBOOK FOR GROWTH MARKETERS

Winning CX will come from Brands who can balance relevance, consistency and convenience to drive engagement. The kind of engagement that drives optimal customer lifetime value and real business impact.

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Relevance has surpassed loyalty in the efforts to win the hearts and minds of today’s hyper-connected consumer. 81% of consumers want brands to understand their moment-by-moment context.

Staying relevant is difficult enough when you just have a few customers in a single location. But for a consumer brand with millions of customers, it’s an overwhelming proposition. It requires the ability to find the signal in the noise of your customer data to consistently deliver interactions where customers feel known, understood, and anticipated.

That’s the challenge for consumer brands eager to move from anonymous transactional revenue to relationship-based business models. If you can do this within the context of a loyalty program, you have the chance to win the hearts, minds, and wallets, of your customers.

Also Read: 5 Ways to Eliminate Customer Data Silos

Here are three ways leading brands can keep their loyalty programs relevant:

Play the long game by winning moments

A rewards program should reward a consumer with instant gratification for each interaction. It’s obvious why your brand wants a lifetime relationship with the customer. But your customer has no such motivation. Each moment of interaction has to be relevant and valuable to them immediately, without the context of a lifetime relationship. Don’t expect them to accept a higher price, or an inconvenient checkout or shipping process because of the hope of a future reward. Great relationships are built on great moments.

Why would a major brand run a loyalty program that created negative experiences for most of its participants? Yet that’s exactly what Verizon Wireless’ old loyalty program did to consumers.  The consumer was required to bid in loyalty points auctions to win concert tickets or travel packages. A few lucky folks were delighted by winning big prizes, but most were simply disappointed for wasting their time bidding on prizes they didn’t win. Verizon launched their “Verizon Up” loyalty rewards program just over a year ago. Verizon Up now makes it simple to turn rewards points into gift cards for retailers like Starbucks, Apple Music, and Home Depot. Now think about the experience for the consumer. Instead, of wasting time bidding on things they don’t win, now millions of Verizon customers are taking advantage of free coffee drinks, or free music. Those moments of enjoyment build brand equity that have an impact for the rest of the customer lifecycle.

Put your data to work

63% of marketers say they have too much customer data to process. This leads to missed opportunities. A customer who has expressed a preference or exhibited purchase intent will be bewildered or frustrated if you can’t use that data to deliver the right interaction. Utilize machine learning and AI to find the data that matters in order to create more relevant experiences.

T.G.I. Friday’s recently tripled online orders by tying their point-of-sale systems into customer insights from other channels. Now they know not only when rewards customers are dining, but what foods they prefer.

There will be times when you will have good reasons to disappoint a customer (or at least to adjust their expectations). That makes it even more important not to disappoint or annoy a customer for no good reason.

Unify across channels

Total Retail’s 2018 survey of multichannel retail reports that 74% of retailers now allow consumers to redeem loyalty points across channels, up from 42% just a year ago. This can take multiple forms such as:

• Earn points online and redeem in-store
• Earn points with one brand and redeem at another
• Earn points in-store and redeem online
• Buy online and pick up in-store (BOPIS)

Also Read: 5 things B2B Marketers Need to Know About ‘Intent Data’

Don’t make users pick a channel (in-person, in-app, phone call) in order to resolve an issue. 75% of consumers expect a consistent experience regardless of how they engage. That means your app should have the same features as your website. It means the merchandise in your store should be available online. It means that a consumer should be able to downgrade or (gasp!) cancel services without having to call and argue with someone at a “save” desk.

Ultimately, the goal of any good loyalty plan is to foster a lasting relationship. That works best when brands let the consumers choose their own paths, rather than forcing them into patterns that erode trust, waste time, or ignore previously established consumer preferences. Brands can’t build relationships instantly, but they can win moments by offering relevant interactions that over time deliver the big prize: customer loyalty.