Loyalty is the answer!
Loyalty and Single Customer View are a powerful partnership and go hand in hand throughout a number of industries. A database that can retain the entirety of your customer data and uses analytic software will be more than a great help to your business in understanding the behaviours and habits of your customers. The vital knowledge you obtain will then make it simpler to reward your customers appropriately through a loyalty programme. Retention generally then follows as customers feel rewarded and can also spin off into new business as your loyalty customers recommend you.
Loyal customers tend to spend more on your products and services than any other customer segment which is why it can pay to recognise and reward them. This cohort of customers are much less likely to waver and be tempted by your competitors, but it’s not guaranteed! By understanding when and what to reward these customers you stand a better chance of keeping them as loyal customers and potentially spreading the word about what you do. However you also need to bear in mind that incentives and offers delivered through a loyalty program need to be cost effective as running such initiatives can become costly if it is not targeted and measured.
Loyalty schemes come in many shapes and sizes and they don’t have to orientate around ‘points means prizes’, however the one thing that is important in whatever scheme you offer, is it has to be achievable. Having a loyalty program that has achievable rewards and benefits means the customer really feels like they are getting something back and as such genuinely feels rewarded for spending their money with you rather than someone else. Regular flyers for example will choose certain airlines to collect their air miles rather than switch to another carrier. Operators such as Virgin have extended this further so miles can be collected not just on their planes but also on their trains, again something what will influence a customer’s buying decision.
In addition to loyalty programs helping you to improve retention it can also give you far richer information about your customers which helps better understand their preferences which in turn enables you to refine your messaging, communications and cross selling to these valuable customers.
With this new level of data added to a single customer view, the more targeted and timely your marketing will be. Restaurants for example use loyalty as a vehicle to collect data such as which meals and drinks you purchased, the time and date of your visit, your spend, even down to whether you split the bill. After just a few visits the restaurant will start to build a profile of each customer in the programme, alongside their favourite location, predominant days and times you visit all combined with the customers preferred products and in some cases whether you prefer your steak well done or medium rare!
VIP rewards are also a great bonus for these customers as not only are they earning points but they can also be rewarded with a little extra to ensure they feel recognised. For example, you may want to reward these customers with something free on each visit in addition to their points.
Savvy and strategic companies are now looking beyond just rewards to retain loyal customers but are also looking to solve customers’ problems. Companies are combining the loyalty programme with wider service propositions e.g. an app customer can also check the status of their flight, boarding time, even check in without having to ask or go to a desk. Companies like Starbucks, provide loyalty customers with the ability to try new drinks before anyone else and even pre-order and skip the queue to collect. Another example of this would-be Amazon. Their loyalty scheme now gives prime users not only free shipping but also live streaming of music, tv shows and movies, storage for photos and much more. With this, they have become much more than free shipping, they have become integrated into the customers life.
Loyalty is not everything but used well it is a powerful tool for businesses and marketers to understand more about their customers. But you also need the right tools to put the data to work so you can make the most of data and insight. And looking further ahead businesses are expanding the whole loyalty proposition to include a wider, richer and seamless customer experience.
If you’d like to know more about how we can help, please don’t hesitate to contact one of our team.