7 Essential Loyalty Program Communications to Maximize Participation
Improving customer experience (CX) is all the rage these days—and for good reason. According to Insider Intelligence, 88% of shoppers feel the experience a brand provides is just as important as its product.
6 ways loyalty helps drive a better customer experience
According to McKinsey & Company, experience-led growth leaders invest in new offerings and experiences—and loyalty data helps inform these decisions to ensure you’re investing in ways that’ll yield the biggest impact. Loyalty is key to your brand’s ability to improve your customers’ experiences while monetizing your customer data in profitable ways.
Here are six ways loyalty helps you achieve your customer experience goals.
1. Know your customers
According to McKinsey & Company, growth outperformers are much more likely to know their customers personally. The best way to know what your customers value is to ask them—and your loyalty program allows you do that as part of the ongoing loyalty conversation. Along the way, you’re collecting consistent, accurate and unique zero- and first-party data with consent at scale. Loyalty programs create endless opportunities to engage customers and collect more data, enabling your brand to keep up with ever-changing preferences and needs.
Here are a few of the zero- and first-party data collection methods you can leverage through your loyalty program:
- Product recommendations
- Program and newsletter signups
- Members communities
- Branded apps
- Customer surveys
2. Personalize and act on customer data in real time
According to Deloitte, the ability to recognize and use emotional data at scale is one of the biggest, most important opportunities for brands going forward. Your loyalty program gives you endless opportunities to directly ask your customers what they value and prefer, then you can tailor their experiences based on the details they share.
Modern loyalty platforms, such as Annex Cloud’s SaaS-based loyalty solution, make it quick and easy to create segments based on any combination of member attributes. The more granular the segments, the more relevant and meaningful offers and rewards you can deliver. Marketers can quickly see what promos, rewards and campaigns are or aren’t working, and modify the details in minutes.
3. Increase customer engagement
Combining robust loyalty data with the opportunities your loyalty program provides to continually engage your customers enables your brand to deliver value-driven personalized engagement. Today’s loyalty solutions offer a wide range of engagement options, including social loyalty, gamification, referral programs, ratings and reviews, and more. These can make your customers’ experiences more fun and rewarding, especially if you incentivize participation. And every interaction leads to more data that can be used to deliver and even more relevant and personalized experience.
Fully engaged customers represent a 23% premium in terms of share of wallet, profitability, revenue and relationship growth compared to the average customer.
4. Add unique value that goes beyond transactions
Consumers want more than a transactional relationship with their preferred brands. Your loyalty program is the perfect way to add value between and beyond purchases, creating lasting emotional bonds. That explains why many brands are looking to expand their traditional ‘buy stuff, get points’ loyalty programs to include non-transactional value and exclusivity.
In his episode of our Get Personal with Loyalty podcast, The Point of Loyalty CEO Adam Posner talks about what he refers to as the ‘Collection of Six Currencies’ that loyalty program members care about:
- Financial currency = show me the money
- Experiential currency = add magical moments to my life (something Adam coined ‘joyalty’
- Utility or functional currency = make my life easier
- Personal currency = make me feel special (inclusivity)
- Choice currency = letting me control my experience
- Social or community currency = help me be a part of something and belong
According to Adam, all of those drive emotional senses and feelings.
70% of emotionally engaged consumers will spend up to 2X or more.
80% will promote the brand to family and friends.
62% will advocate for the brand on social networks.
(Digital Transformation Institute)
Ways to add non-transactional value with loyalty
Simply recognizing your customers can be a powerful reward—and there are plenty of other meaningful non-transactional ways to add value if you really understand your customers and what’s important to them. It can be helpful to measure your customers’ ‘share of life’, instead of just share of wallet. This expanded view opens up more and varied ways to become indispensable in as many aspects of people’s lives as possible. Convenience, exclusivity, partnerships and subscriptions are all effective ways to deliver customer value outside of transactions.
5. Deliver a seamless, consistent omnichannel experience
Delivering consistent personalization can be challenging if your organization is like most enterprises, with complex tech stacks. The right loyalty technology can be the glue that connects the dots between all customer-facing efforts, allowing you to recognize and reward customers consistently and in meaningful ways no matter where your customers engage and shop—including allowing members to redeem loyalty rewards through any channel, including your ecommerce site, mobile app, email, in store and more.
6. Drive growth
Forbes reports that loyalty programs are proven to increase customer lifetime value by up to 30% by increasing frequency and spend per visit and winning back lost customers. It’s also a more cost-effective way to gain new customers through advocacy. Loyalty data can inform and enable a better customer experience across the entire journey—plus improve merchandising, operations and more—all things that can improve your margin.
Existing customers buy 90% more frequently, spend 60% more per transaction, and bring in 23% more total revenue and profitability than newer customers.
Customer experience and loyalty go hand in hand
Conversations about loyalty inevitably surface discussions about customer experience and vice versa. Read the full guide on How Loyalty Helps Close Your Customer Experience Gap. Then talk with one of our experts to explore how loyalty can take your customer experience to places you never thought were possible.