Loyalty programs can offer your retail business numerous advantages. However, for your loyalty marketing strategy to work, you need to keep abreast with the latest developments in this fast-changing industry.
Shopperloyaltyrewards.com shares their insights on how to make retail loyalty programs work in 2016.
Spend more money on loyal customers than on efforts to acquire new ones.
Retail research indicates that the most loyal customers spend about 50 to70 percent of their monthly budget with the merchant they’re loyal to. Therefore, you can do much more business with your loyal clients. Spend more money satisfying these returning customers than on acquiring new customers. Use your loyalty data and offer bespoke rewards rather than random offers.
Use personalized promotions to cloak prices from your competitors.
You can use your loyalty program to send special offers to targeted shoppers. For instance, you can send special offers to loyal customer’s smartphone. For maximum effect, send the special offers when the shopper is already in your store. Consequently, shelf prices will be less significant to your loyal customers. And if your competitors have a habit of matching your prices, they will have a hard time trying to figure out your discounted prices.
Your program should be more than a program.
The best loyalty programs are designed not as mere programs, but as strategies that complement other brand’s efforts. You should integrate your loyalty data insights with other elements of the organization such as your investment strategy and human resources. Also, carve out and reserve particular, high-value aspects of your loyalty program for those clients who seem interested and likely to appreciate such features.
Focus on customer experience rather than rewards.
Loyalty programs work when they do something to offer a superior customer experience. Your reward and loyalty strategies should focus on improving customer experience. Use the loyalty data you’ve collected to address individual shopper needs the best way you can.
On average, a typical American family is enrolled in 29 loyalty programs, but is only active in 12. Chief among the factors that have led to the declining odds of engagement is retailers’ obsession with predictable, one-dimensional loyalty models. Know your loyal customers and proactively look for ways to improve their shopping experience. Make them feel special and appreciated.