Unlocking the Keys to a Successful Loyalty Program

LoyaltyRemember those days when customer loyalty programs meant you were given a little punch card to carry in your overfilled wallet to tally your purchases so you could eventually be awarded with a discount on shoes, a free coffee or a car wash? Admittedly I have one of those still for Kleen Wave Car Wash…and I actually use it because eventually I will get a “free” car wash.

Of course, I already can’t find what I need in my overstuffed purse, wallet or inbox. And after hitting 20 of these little loyal customer cards (yes I had more of those than pairs of boots) I started throwing them out. Loyalty down the drain.

Thankfully, loyalty programs of today are, for the most part, much “smarter.” I can enter in my phone number to engage with my loyalty program versus searching for that small plastic card. Nowadays, companies that invest in a well-planned and well-executed reward program are reaping their own rewards…right to their bottom line, and creating loyal customers along the way. Data is a huge part of that equation.

There are different ways to launch a strong loyalty program. Create one that is unique, or maybe copy a successful competitor. Even more impressive: Use the data you already have and ask your customers what they want, letting them shape your program.

“Retailers rarely ask their customers what motivates their loyalty because they assume they already know,” says Chip Bell, author, and senior partner of the Chip Bell Group, a customer experience consultancy. Don’t overlook this step.

Whatever your strategy, another key to success is making sure your customers know about your program. Seems obvious, but in retail, that can be a challenge. With stores that have high cashier turnover, such as your local supermarket, this could really back up the line. And no one wants to spend more time in a checkout line if they can help it.

After your loyalty program is up and running, you should use everything at your fingertips to spread the word about your awesome new program. The obvious low-hanging fruit is through email, social media and websites. But have you considered print and how it can supplement your online marketing efforts?

For instance, let’s say your company wants to send rewards in the mail. Will it be a coupon book or a gift card? Whatever it is, make sure your customer knows why he or she is receiving that piece of collateral. Make the interaction meaningful, as in make it personalized based on their shopping habits. If you have the data, use it. The customer will feel special and that will in turn build loyalty.

But wait! It is not just about giving customers that warm and fuzzy feeling. There is the glorious data. Data that helps a merchant determine ongoing assortment, promotions, buying habits, cross-promotions, communications and customer engagement that can actually help shape the business strategy. This is a beautiful thing.

Knowing how to use all of that data can also be a huge challenge, but it is crucial to understanding your data map, according to loyalty experts. In this interesting article, “How Sally Beauty Gave Its Loyalty Program a Stunning Makeover,” Advertising Age says that it all comes back to data infrastructure — something that we all need to embrace. As the CMO of Sally Beauty Supply, Ryan Linders said during the interview, “The biggest thing I’ve learned is that you’re only as good as the data you have…that has helped us unlock everything.”

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