A marketer’s guide to increasing customer retention and generating loyalty.
According to 3Cinteractive, 64 percent of brands reported an increase in loyalty program membership over the last year. Loyalty programs are becoming more sophisticated, moving beyond the traditional spend-and-get model, to omnichannel and multichannel programs that recognize customers for every interaction they make with a brand. Smart marketers are capturing and leveraging loyalty data to understand their customers better and market effectively to them.
1. Omnichannel and multichannel programs are replacing traditional programs
More and more brands are adopting omnichannel-based loyalty programs, which are proving to be very effective. Omnichannel loyalty connects customers to a brand across all touch points seamlessly and provides members with the opportunity to be rewarded for spend and engagement across all channels. Furthermore, omnichannel data capture helps brands drive personalized communications and better customer experiences. Beauty giant Tarte’s recently launched “tarte <3 rewards” loyalty program rewards members for not only spending money with the brand but for sharing content on social media, referring friends and reading emails. These activities keep members engaged and informed about the brand and help promote the brand benefits to a wider audience, turning members into brand advocates. The spend and engagement data captured can also be leveraged for future marketing efforts.
2. Consumers expect personalization
Research finds a correlation between personalization and customer satisfaction. Seventy-nine percent of customers surveyed indicated that they are very satisfied with loyalty programs with high personalization and that loyalty programs that make customers feel special and recognized had 2.7 times more satisfied members.
Research indicates that consumers are willing to share data to get personalized experiences. By leveraging customer data captured in a multichannel loyalty program, brands can make personalized recommendations, offer relevant promotions and upsell and cross-sell relevant products or services to consumers. We’re seeing many retailers this year incorporate personalization into their customer strategies. Recently, members of the DSW rewards program were sent an email that contained how many points each member needed to receive a $10 certificate. They were also informed of other deals they’re eligible for. They also use member data to provide a detailed snapshot of their customers’ interactions with the brand over the past two years, including how much they’ve saved, how many points they’ve earned and how long they’ve been a loyalty member. The campaign was a success and saw a 64 percent lift in email opens, a 13 percent lift in click-through rates, and 58.82 percent of customers who opened the email read it for 15+ seconds. Frequent personalized communications like this help keep members engaged and encourage sales.
3. Partnerships have increased
2016 saw brand partnerships take center stage as a strategy for growth. Now we’re seeing an increasing number of brands seek out strategic partners to stay ahead of the competition. Partnerships help brands extend additional value beyond what they provide alone. Whether for a loyalty campaign or an evergreen program, the right partnership provides new and exciting ways to reward customers which will drive sales and loyalty.
For example, Wyndham Rewards, a highly ranked hotel rewards program, recently partnered with Caesars Entertainment’s award-winning casino-based “Total Rewards” program. The partnership offers their combined membership of over 50 million access to industry-leading travel experiences and perks and benefits including complimentary status match and opportunities to redeem points for one-of-a-kind hotel, restaurant and entertainment experiences. The partnership extends the reach for both brands and connects them to potential new customers.
4. Consumers expect brands to be socially responsible