How do you build an attractive long-term loyalty program?

When you start thinking about a loyalty program in your organization, be aware that such a program is more than a tool to increase sales these days. Modern programs allow clients to identify and develop their passion. Thanks to the technology behind loyalty programs, the customer feels special in situations that are important to him or her.

Such a program structure helps build an emotional connection with each customer. In the long run, every customer counts too. In an innovative, modern program, increasing sales should not be the main objective, but the main focus should be on helping customers and meeting their needs. These sales figures are an additional part of the program.

So it is important to move from a strict sales model to one that solves problems for customers and helps them in their daily lives

When designing a loyalty program, it’s helpful to listen to what your customers have to say and think. This research will provide valuable information about how customers envision the program and what features and options they would like to use. With this knowledge, the company or organization can examine its own starting points and short- and long-term objectives.

Strategy plays a key role in a program action plan and should focus on realizing potential and connecting all resources. Yet even such a strategy will not work without the right tools to implement the strategy. With these tools, you can offer customers what they want in exchange for data about their purchases, which you can process appropriately with AI.

Building tools to analyze and collect customer data is an expensive and time-consuming process. It is a much better and more affordable option to use turnkey solutions developed by a third party vendor. In that case, you simply have to implement your strategic process. Given the amount of data involved, technology is truly critical to achieving your goals.

Developing an attractive program also means ensuring that the budget is sufficient for the strategy. Even the best strategy won’t work if not enough money is pumped in. So it is useful to analyze each campaign you have already run and assess whether that campaign delivered the expected results. That method helps you determine what works and (more importantly) allocate sufficient resources for future activities. With this approach, you also discover the golden mean between necessary investments and attractive rewards for the customer.

Build an emotional connection with a brand/company

Values

The design of a loyalty program should be based on building an emotional connection with the customer. Who doesn’t feel special when you get a surprise on your birthday? The customer feels special and knows that the company is thinking of them at an important moment. Program members also enjoy supporting their communities and making a significant positive impact on their environment. For example, by giving extra points to customers when they buy organic products, you can promote a healthy lifestyle and support local producers. All activities that protect the environment also support local communities, create positive brand relationships and influence the organization’s KPIs. You can also build an emotional connection by giving customers the option to donate points to charity or by offering promotions on near-expiry products (which will help reduce food waste). Such actions improve the image of a brand among customers who attach great importance to environmental issues.

Over the course of a year, other similar opportunities may emerge – all ways to generate positive word-of-mouth for the brand on social media.

Remember that any loyalty offer must always be better than the regular public offer. It also has a significant impact on building trust in the brand and strengthening the emotional connection between the brand and the customer.

Personalization

To develop an attractive long-term loyalty program, it is important to consider each customer as unique, in other words, to put personalization at the center of your technological solutions. This vision helps an organization understand each customer’s individual needs and also contributes to cost-effectiveness, meaning investments in the program have measurable benefits. With so many new challenges and opportunities constantly emerging, it is important to keep two things in mind: the needs of the customers and the activities of the program manager. To be able to solve these points, AI and ML are important tools. With AI, loyalty program managers can create a unique customer experience and make customers happy to be a member of a unique program. Technology also has a significant impact on long-term customer retention and builds brand loyalty. By automating complicated, yet monotonous and time-consuming analytical processes, AI frees up both time and money that you can spend more productively. Personalization is key to customer loyalty, and customers are more likely to make a purchase when they find the deals they’re looking for on their phone. Artificial intelligence and machine learning help you quickly and efficiently create rewards and offers based on customers’ purchase history.

omnichannel

Current technology is blurring the lines between online and offline. So an attractive program that can build long-term loyalty must provide an omnichannel experience. Customer behavior is changing rapidly, affecting purchasing decisions and the buying process. In the long run, customers will be more satisfied if they can easily purchase a product and receive a reward regardless of their device or preferred platform. Keeping your customers happy is key to reducing churn. This way, your customers will keep coming back when they have new needs. Omnichannel operations take into account every platform and device a customer uses to interact with an organization and deliver an experience that is equally effective and positive across all platforms. Omnichannel is especially important for loyalty, as the strategy has a significant impact on customer loyalty to a brand. This in turn has direct consequences for a company’s results.

If you are planning additional promotions alongside the program, it is very important to ensure that all offers also respond to the program, even if it is in a very limited way. Ensuring that specific offers are available on all available platforms has a significant impact on your message to the customer and adds value to the reward.

Mobile apps are also important in making a program attractive and provide unlimited opportunities to initiate customer interaction. Thanks to these apps, customers’ lives become much more accessible through features related to quality of life. At this moment, the world has 6.3 billion* smartphone users. App usage and smartphone penetration are still growing steadily, and there are no signs of slowing down in the future.

With a feature like ‘click and collect’, apps make it much easier for customers to buy something. The feature saves time (you don’t have to stand in line) and reduces operating costs for the organization (by reducing money management costs, for example).

In short: if you are building an attractive long-term loyalty program, your customers are the most important thing, and each customer is an individual that you should always reward uniquely. Only in this way will your customers feel special and have an emotional connection with the brand. Thanks to the new technology and the use of artificial intelligence, the perfect solution for loyalty exists. The large amounts of data involved make it clear that modern loyalty programs cannot do without this technology.

*www.statista.com/statistics/330695/number-of-smartphone-users-worldwide/

Consumer Brand Loyalty Market Research 2022

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