Are Loyalty Programs Still Relevant? | #1 CRM Solutions & Loyalty Service Provider in the Philippines

Are Loyalty Programs Still Relevant?

Are Loyalty Programs Still Relevant?

On October 13, 2015, Posted by , In Featured, By ,,, , With No Comments

Loyalty Program

There are many establishments who think that Loyalty Programs are only about points. You may have so much data but you don’t really know what to do with the data. Worst, others say my loyalty program is not working for me. Some have copied someone else’s loyalty scheme and implemented it not knowing if the same structure will work for them.

POINTS ARE THE LEAST IMPORTANT FACTOR IN A LOYALTY PROGRAM.  Believe it or not, the most important factor in a loyalty program is not the points but the data that a loyalty program is able to generate.  Points is just a means to understand your customer behavior for you to determine who are your most profitable customers, your potentially profitable customers, unprofitable customers and how to change their behavior based on their profile and spending pattern.

That is the reason why crm-driven programs are very important in driving loyalty.  If you are unable to study your data then it will just be a rewards program that may not be rewarding the right customers based on a behavior you want to achieve. Take for example you have two shoppers where one buys every month at Php2,000 and another that buys every week at Php500 which is both a total of Php2,000/month.  One is a young, full-time mother with a baby who buys a lot of baby goods while the other is a successful businesswoman in her 50’s who buys expensive gourmet food.  If you wish to be relevant, then you can offer baby items either bundled or discounted to the young mother and new arrivals of expensive gourmet food to the successful businesswoman.  You can even further engage them by providing the young mother to your fan page on baby tips and engage with other young moms like her.  The businesswoman, on the other hand, may be more interested with easy to prepare cocktail food using the store’s ingredients. Relevant communications can be directed to each segment via the POS, email, sms, and fan page and other online channels.

When and how to communicate is crucial in capturing the attention of the customer.  If you are in the pizza business and you have studied that most of your customers order pizza every Friday then you know then the perfect time to send them an sms reminder.  A special offer of  “2 pizzas plus 50% off the 3rd pizza” would encourage more purchase or group purchase on a Friday night.  You can send by Thursday and Friday morning so you don’t miss out the opportunity.

Rewards should not only be something that the customer needs or wants but also the timing of the rewarding should be perfect.  Going back to the example of a young mother,  a reward could be giving a spa gift for time off for herself.  The customer should know what she can redeem so she can aspire for it , easily redeemable and a reminder that she can already redeem, would make it more effective and engaging. If you are giving rebates to your customer, make sure you also reward her with something else that would make her special.   These can be done through birthday specials, mom-only events or freebies, etc.

Most of all , customer centricity is crucial in any successful loyalty program. Your frontliners are the key drivers of your loyalty program.  Based on our studies, frontliners contribute about 70% of the success.  Stores should train and reward their frontliners to motivate them and give your customers the service they deserve.

Remember, your customers are your best sales people.  Treat them well and you will not only win a bigger share of their wallets but a bigger share of their hearts.

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