Reinventing Loyalty in the Age of the Consumer
There was a time when oil was the resource to fight for. Today, the most empowering resource is data.
As companies are focusing on interacting with customers via different channels, the key ability lies in how to leverage data to offer loyalty to customers.
In today’s Age of the Consumer, the new currency that is slowly taking shape is loyalty. It is becoming the goal of any brand’s loyalty program to meet and exceed customer’s expectations. While loyalty programs have been prevalent for a long time, customers are looking for instant gratification. Earlier, the reward system was quite transactional, wherein traditional loyalty programs required customers to spend over a period of time to receive rewards later. Today, loyalty is no longer an extension of a customer’s journey, but has become a driver of purchasing. Customers are equating loyalty and reward points with cash, making this understanding of cash more tangible and engaging in their lives. Developing loyalty programs is no longer a simple give and take system, but requires a better understanding of customers.
To gain a more interactive and engaging reward system, it is importance to differentiate between habit and loyalty. Brands must be able to convert a consumer’s habitual purchasing into loyalty driven purchasing. The biggest factors that will drive loyalty and customer retention is data and innovation. Brands must unearth the essential elements that drive loyalty, with an understanding of industry and cultural trends and then exploring the real time consumer experience. By tapping into this data, it will help build a targeted reward system offering a personalized experience to each customer. Brands must ensure their loyalty offering is engaging and unique to each customer. Customers want the brand to know them and technology innovations and data analysis are evolving to interact with customers with personalized offers that add more value.
Once the data is at hand, innovation is the focus to deliver better loyalty experiences to the customer. Consumers have previously been lulled by consistent but stagnant reward programs. It is not enough to simply communicate, but drive behavior. Brands must convert these rewards to something more fun, surprising and compelling to engage their customers. As the famous saying goes, “A satisfied customer is the best strategy of all”, there is slowly a shift from rewards for shopping to shopping for rewards. Via exciting loyalty, brands can offer experiences that will become a staple of customer’s daily life.
The key concept is emotional loyalty rather than transactional loyalty and as a result major loyalty trends will see a wave of innovation in terms of personalization and engagement. It is important that the loyalty program delivers on the brand’s value and enhances the relationship with customers. The coming future will witness loyalty programs working in tandem with insights into customer data and innovate technologies to deliver interactive and exciting rewards.