Want Loyal Customers? It's Time to Fix Your Loyalty Programs

Five Strategies for Brands to Increase Customer Loyalty

By Published on .

Reprints Reprints

With brands competing for customers' loyalty and wallets, they need a creative way to differentiate. A recent study shows that the brands with the highest loyalty outperformed other brands on perceived product performance, experience and trust.

Having a good product is always important -- but that is just one of the three components consumers see as vital to their loyalty to a brand. To help with those other two -- experience and trust -- here are five strategies brands should embrace to rework their existing mindset when it comes to customer relationships and loyalty:

1. Offer helpful information, not marketing messages. One tactic that never gets old is proactive, helpful communication. Most companies are good at it after a purchase. I get emails or texts when things I've ordered are shipped, or when a flight I'm booked on has been delayed. But what about while I'm shopping? If you know that I'm looking at your products, be proactive and serve up content that I will feel is informative and relevant -- not just a marketing message. Brands should recognize that consumers are busy and constantly on the go, creating an opportunity to win our hearts by making our lives easier, even before we become a customer.

2. Make loyalty cards actually build loyalty. One approach that is getting old is loyalty programs. Historically, these programs were put in place as a way for marketers to gain insights into their best customers' behavior to market to them more. These programs tend to reward the high-spending customers, while generally doing little to build loyalty among casual customers. It's time to reimagine the loyalty program -- not as a data-gathering tool, but rather as a way to offer differentiated experiences that will actually build engagement between a consumer and a brand.

3. What comes first -- the data or the loyalty? It is also absolutely essential that organizations harness the abundant data available to understand their customers. After all, how else can they hope to engage them around their wants, needs, challenges and preferences? To get a complete picture of each customer, brands must bring their business processes and customer information (including data from external sources) together in one core platform. If a company markets to me, armed with just a partial customer profile, it's a missed opportunity to tailor their communication. Or worse, it's inaccurate or inconsistent from how they communicated with me on a different channel. The full picture and the ability to act on it in real time are paramount to understanding me as a customer and taking the brand experience to the next level.

4. All together now, consistency on every channel. Just like data, siloes also come in the form of organizational misalignment. For engagement to be seamless and consistent, marketing, sales, customer service and other departments all must work together in a coordinated way, aligned with an overarching strategy. Because consumers see a brand as one company, the brand needs to view itself in this way, too. There are no departments, nor channels, at least from the customer's point of view.

As the emergence of the internet, mobile, social and now the internet of things (IoT) has added complexity for brands, these channels have simplified the way that people communicate by giving them a great deal of flexibility. Brands that can capitalize on carrying a consistent conversation with the customer, regardless of how many channels it crosses or which department is interacting at any given moment, will be rewarded.

5 .Don't open the door to disruptors. This is why organizations need to invest in a core technology platform that breaks down barriers and simplifies the landscape in the front office. Ignoring this and leaving the status quo in place will only yield dropping customer satisfaction rates and eventually a loss of customers. Worse yet, disengaged customers will seek out new alternatives which may not be with established competitors. In this digital economy, innovators, such as Uber or Airbnb, are disrupting markets by introducing new models when current players are not changing quickly enough.

Today's "loyal" customer is vastly different from the one we knew historically. Brands must keep in mind that without developing and acting on strategies required for exceptional customer engagement -- and eliminating those that hinder it -- they will be replaced quickly. While technology is important, brands must stay focused on how it helps them engage their customers in their market, without getting sidetracked by technical novelties. This means prioritizing transparency and collaboration across your organization and selecting a platform that sets you up to succeed with the customer of today while being agile enough to adapt with them tomorrow.

Most Popular