As per a report by Edited, the global beauty industry is valued at $532 billion and counting. Since the bulk of the consumers are millennials, the beauty industry has got the enormous potential for a phenomenal rise. Many companies today are looking at the beauty industry to leverage the potential by designing the beauty rewards program.
Social media influencers have been a behemoth factor in the revival of the beauty industry. Though the industry was never in the decline, the rise of social media has changed the dynamics of marketing.
Today, the internet influencers including YouTube vloggers and Instagram trendsetters are a new crop of brand ambassadors. The beauty brands have ceded the marketing space to these beauty vloggers. Only 14% of brands make beauty videos on social media, while a staggering 86% is generated by individual marketing influencers.
The companies can leverage influencer’s outreach to promote their beauty products and increase customer engagement.
For example, the popular beauty blogger Yuya makes a video to show how to apply lipstick effectively. Very soon, the lipstick brand generates a lot of interest in a section of her 25 million YouTube subscribers. As a result, the customer engagement for that brand shoots up.
The collaboration between cosmetic brands and internet influencers is the cornerstone of customer engagement in the beauty industry. Since beauty YouTubers follow a particular niche, a large section of the company’s potential customer base is already segmented. The beauty brand’s loyalty program can be optimized carefully keeping in mind the taste of the influencer’s audience.
The brand offers free gifts or lucrative beauty rewards for engaging through the influencer. The loyal followers of the influencer become loyal consumers of the brand. The beauty rewards program which encourages customer loyalty is a win-win for all stakeholders. Everyone wins including the brand, the influencer, and the end consumer.
Customer retention in the beauty sector is far beyond a good ‘lip service’. Customer retention is also easier since communication is transparent with social media. In an industry dominated by young consumers, the brands must adopt a strategy that resonates with millennials.
According to a Forbes article, millennials choose ‘quality over quantity’ and search for everything better. It is a generation that prefers experiences over material possessions. The attributes of a great loyalty program have customer experience, exclusivity, and quality at its core. Since millennials dominate the consumption, the beauty sector is tailor-made for loyalty programs.
Beauty loyalty programs can be designed depending on the customer’s choices. They can get gift cards for using a particular service like skin care, or exclusive access to beauty clubs. But most beauty brands reward their customers using a traditional points-based approach. They play safe because beauty is a subjective experience.
For example, Ulta Beauty’s loyalty program, known as Ultamate Rewards, goes by the tag line “where beauty loves you back”. The Ultamate Rewards loyalty card, similar to a redeemable credit card, is offered to every member who joins the program.
It operates on a simple principle. Every dollar spent earns a reward point. However, extra reward points could be earned if customers opt for email and app notifications. The points can be redeemed in form of discounts after reaching a critical mass of reward points.
For every 100 points, customers can get $3 off during the next purchase. The discount value increases with a higher value of reward points.
Apart from the standard membership which is available for free, there are higher tiers named Platinum and Diamond. Some of the exclusive benefits of the higher tiers:
According to a report, Ultamate Rewards program contributes 90% of overall sales for the brand. Many argue that Ulta’s beauty reward program works exceedingly well because Ulta Beauty is an established brand. But we believe that the rewards program has solidified the Ulta Beauty brand. Customers see no reason to leave Ulta, and they keep coming because of the rewards and experience.
There is no reason why other small beauty brands cannot emulate Ulta’s loyalty strategy. Many in-store retail beauty brands, including hair salons and beauty parlors, can design salon loyalty programs to increase their customer engagement and sales.
A health care loyalty program is different from a patient loyalty program. A healthcare consumer may not necessarily only be a patient. Usually, the older generation forms the majority of patients. But the ones who majorly consume healthcare facilities are millennials, who are children of the patients. On average, one patient will bring three relatives in the healthcare consumption cycle.
The touchpoints such as in-counters, parking, hygiene, hospitality services, medical stores contribute to the overall consumption experience in the health industry. Just like the beauty industry, the healthcare sector must design loyalty programs that are based on great customer experience, not just limited to patients.
As discussed in the blog, the beauty and health sectors are ideal for loyalty. It can be built on small, medium, and large scales depending on the requirements of your business. Programs can be customized accordingly to suit the needs of professionals ranging from a salon owner to a medical professional.
If you are looking for a loyalty partner for the beauty and health industry, connect with Annex Cloud today!