In today’s ever-increasing competitive retail environment, it’s vital to identify and nurture not only your most valuable customers, but also your existing and new customers. This way, you can create deeper, longer-lasting relationships that last the customer’s lifetime and lock in stronger margins and increase your brand’s awareness.
More than ever it’s crucial to deliver experiences that are attractive to your customers and use a best-in-class tech stack to manage them accurately and effectively. Employing the right loyalty and incentive program is rewarding for both your customers and your bottom line.
For today’s retail customers, loyalty programs are a meaningful and expected way to strengthen brand relationships. Intuitively incentivising customers to continue doing profitable business with your brand, increasing brand loyalty and advocacy, and drastically reducing the rate of customer churn.
According to Bond research, 87% of loyalty program members are interested in having details of their activity and behaviour monitored in order to receive access to personalised incentives or experiences. And just over 90% of Gen Z and affluent members are willing to give their consent to monitor their spending patterns.
As with all strategies, there are pros and cons when assessing loyalty programs more broadly.
Successful loyalty programs have the power to incentivise customers to continue doing business with brands. They can build solid brand loyalty by rewarding customers with real value that they can personally identify with. Their brand patronage increases and can potentially transform them into brand advocates.
Good programs create loyalty, though, not just reward loyalty, which was there anyway.
Implementing a successful loyalty program lets you track customer spending habits and overall trends. It also allows you to understand your customers better so you can tailor your brand experiences holistically to meet their wants and needs.
Depending on the loyalty program being offered, it has been shown that there is a degree of scepticism among customers. However, this is usually linked to trust regarding customer data. According to one study, 71% of consumers believe brands with access to their data are using it unethically.
To overcome these customer concerns, it’s vital to explain to your customers why and how you want to use their data and what you’re going to do with it. Being transparent builds trust and once you’ve gained that trust, you’ll find consumers are more willing to share their data when there is a clear benefit to be gained – such as lower prices, tailored deals or special offers that are included in your loyalty program.
With more and more brands offering loyalty programs, competition can be fierce. To make your loyalty program successful, you need effective customer experience strategies and correct customer experience management, coupled with powerful customer experience software.
Discover how Omneo can help differentiate your loyalty program and make it succeed where others fail.
Storing unnecessary customer data can be a liability should your brand experience a data breach. You should minimise the data you capture to only those that directly relate to the mechanics of your program or those that enable better customer shopping experiences.
Keep an eye on what these retailers are doing to give your existing customers a world-class customer experience journey that's so attractive they will refuse to leave. After all, if it’s been successful for them, no doubt it could be successful for you.
By using modern mechanics in their Loyalty Programs, including Rewards, Benefits, Perks, Points, Tiers, Achievements, and Status, these retailers have developed a personalised and event-driven program linked to their customer transactions and interactions.
Mecca offers global beauty brands and Beauty Loop is their loyalty membership program. Members can enjoy extra gifts, exclusive offers, and deluxe samples of some of the best in beauty, along with access to exciting in-store experiences. This program employs Tiers with loyalty members increasing their tier level, based on their annual spend. The higher the Tier level they reach, the more they are rewarded. The top tier, Level 4, includes exclusive insider access to purchase new products and limited-edition collections prior to their release.
Discover more about Beauty Loop
The Nespresso loyalty program is also a Tier loyalty membership program focusing on long-term loyalty. Customers can move through 3 distinct Tiers: ‘Connoisseur’, ‘Expert’, and ‘Ambassador’ to gain exclusive rewards. The tiers are based on the number of Nespresso capsules the customer purchases and the period that the customer remains in the program. Rewards from Nespresso grow the longer customers purchase from them. The highest Tier ‘Ambassador’ is for customers who have purchased capsules for 10 years and over. This Tier offers the most favourable rewards.
IKEA Family
Unlike other programs, IKEA Family rewards customers the moment they sign up for their member card. It’s a program for everyone, from those just looking for a few pieces of furniture to those looking to refurbish their home completely. Members enjoy discounts on many products, free just-in-case protection, and exclusive member prices on a range of meals in the Swedish Restaurant and Swedish Food Market.
Discover more about IKEA Family
When Baby Bunting, Australia’s largest baby goods store, launched its customer loyalty program in FY2021, it proved to be a huge success. It reported 1.3 million program members in the first half of the financial year 2022, including 700,000 active members, a lift of 17 percent year-on-year. Customers in the program receive a loyalty voucher upon joining and then can earn $10 vouchers for every $200 spent, as well as bonus vouchers for milestones and free lay-by.
Discover more about Baby Bunting’s loyalty program
Rebel Active rewards its members with exclusive offers each month with reduced pricing. The program includes competitions with exclusive giveaways, prizes, game tickets, and money-can’t-buy experiences. Plus VIP Experiences such as access to exclusive events, celebrity appearances, sporting events, and VIP shopping experiences.
Discover more about Rebel Active
By following retailers who have implemented successful loyalty programs, you’ll be able to build better customer profiles, reduce errors, and improve data visibility across your business. Understanding your customers’ spending habits and gaining deep insights into their buying behaviour via all channels puts you on the front foot. With this data, you can make better business decisions and increase customer retention.
Secure more revenue from your existing customers, increase customer lifetime value and advocacy, and protect your profit margins from excessive discounting and increasing acquisition costs.
Discover how to drive growth through loyalty, retention, and advocacy at every stage of the customer lifecycle with Omneo.
