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It’s Time to Level-Up Your Loyalty



With loyalty schemes a dime a dozen, it’s time to go back to basics and rethink the value exchange for your most loyal customers, says Digitas' Erin Blake

It’s Time to Level-Up Your Loyalty

How many times in the past year have you joined a loyalty program for a discount code, or free shipping, or some other nominal perk only to immediately unsubscribe and forget you ever joined a program in the first place? If you’re anything like me, it’s probably way too many to count. Unfortunately, that is the sad reality facing many loyalty programs, with Bond Brand reporting that the average consumer is only active in half of the programs they belong to. For brands to continue to earn the loyalty of their customers, they need to think beyond the point to provide true value to keep customers coming back.

Help Me Help You

What we are seeing more and more with our clients is that their customers aren’t as interested in the program mechanics of the traditional earn-and-burn schemes that are ubiquitous across loyalty programs in almost every vertical. That’s not to say they aren’t important and that brands can abandon them, but rather that in 2021 some level of “spend to get” is considered a table stakes component of a loyalty program, and not something that really differentiates one program from the next. Instead, what we’re seeing is more attention being paid to ancillary benefits and improvements to the overall customer experience that being a loyalty member affords customers.

When it comes to driving true loyalty beyond the transaction, customers are looking to brands that elevate the experience by providing something helpful for members. Doing so builds trust, as customers feel valued as more than a number in a database or spreadsheet. Brands that invest the time and effort into truly understanding their customers and providing them with value-add experiences will be the ones to win the loyalty war.

Thinking Beyond the Point

The value exchange formula has changed for customers. No longer is it enough to hand over your data to a company in exchange for a discount or reward. In 2021, loyalty program members have higher expectations from their favourite brands. The equation has shifted to customers wanting to be treated differently based on their value to the company as a loyalty member. And that increasingly means providing a better experience across the board. 

Here are some of the ways brands can meet their customers where they are and provide a better experience across the customer journey, driving loyalty and retention without the added liability on the books of a point:

Make My Life Easier: There is very little in the world that people appreciate more than when a company takes the burden off of their customers. From saving shipping and payment information to enabling easy reorders, making it easy for customers to do business with you builds affinity and trust. And this applies to the post-purchase experience as well. Nothing will get me to join a program or hit “add to cart” faster than knowing that returns aren’t going to be a whole ordeal. Especially in the world we are living in now, no one wants to have to jump through hoops to return an item that isn’t working for them. (Bonus points for any company who includes a return label with the original shipment because they realize that many people are still working remotely and that almost 4 in 10 households don’t have a printer and doing so is the least they can do so that their customers don’t have to track down a neighbor with a printer or pay UPS $3 to print out the label for them...or is that just me?)

Know me everywhere: It’s 2021. Customers are -- and have been for quite some time -- acutely aware of the sheer amount of data that companies are collecting on them. It is an expectation, not a nice-to-have, that companies fulfil their end of the bargain and use that data to provide a more relevant experience. If you haven’t already, it’s time to invest in a single view of the customer so that you can identify customers regardless of channel and provide a seamless experience for them at every touchpoint. And with cookies being depreciated, it has never been more critical to invest in a first party data strategy to know who your customers are. Customers have little patience for a brand that cannot provide a seamless experience across both devices and channels. 

Earn my trust: We get it. Things happen. But how a company chooses to handle a bad situation can make or break customer loyalty. According to a 2019 study by The Verde Group, 76% of customers have experienced product or service issues in the past 6-12 months. Even worse: these problems can cause a 24-41% drop in loyalty indicators such as intent to repurchase or recommend. Going the extra mile to make a customer feel taken care of can really make a world of difference. While this is true for all customers, this is especially true for members of your loyalty program who expect preferential treatment due to their loyalty to your company. Taking care of them can not only inoculate your brand from a loss of loyalty due to a poor experience, it can build even stronger loyalty when you are able to turn a negative into a positive for your customers.

With loyalty schemes a dime a dozen with little to no differentiation between the vast majority of them, it’s time to go back to basics and rethink the value exchange for your most loyal customers. Customer expectations have risen at a faster rate than many brands can keep up with. Investing in an elevated loyalty experience that is truly that -- a superior experience that drives true loyalty beyond transactional loyalty -- is the only way to break free from the sea of sameness across the loyalty landscape.

Erin Blake is associate director, connections strategy at Digitas

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Digitas USA, Tue, 06 Jul 2021 14:40:00 GMT