7 Learnings to Implement a Loyalty Programme Successfully

Implementing a new loyalty programme is both exciting and complex.

You've got a clear vision, and now it's time to turn strategy into reality. This phase involves navigating the entire customer experience, addressing all edge cases, and collaborating with nearly every function in the business. You must plan for immediate action and anticipate needs 12 months down the line, all while solving unexpected challenges creatively and rapidly.

In this article, I'll dive into the "developing" phase of the 3D process, which focuses on how to bring a loyalty programme from a strategy whitepaper to life. I'll share the pitfalls I encountered and the lessons I learned while building and launching a loyalty programme.

SEVEN LEARNINGS TO IMPLEMENT YOUR LOYALTY PROGRAMME

1. Map out the customer journey including operational aspects.

While you may have a top-line customer journey from the defining phase, the developing phase requires a more detailed, end-to-end, omni-channel customer journey to visualise the entire customer experience.

The keywords here are “end-to-end” and “omni-channel.”?

The loyalty experience goes beyond just earning and redeeming rewards. Every interaction, from viewing an advertisement for your loyalty programme to having rewards-related complaints handled by Customer Service, is part of the loyalty experience. Additionally, loyalty teams should ensure that all channels, beyond just the mobile app or website, are considered in the mapping process. Many businesses nowadays have multiple commerce channels including online, brick-and-mortar, and even partner channels. Therefore, ensuring the loyalty experience is consistent across all commerce channels is important.??

Lastly, the operational aspects of a loyalty programme need to be thought through as well.? A common issue for retailers is customers struggling to scan their loyalty app in stores. Restaurant technology and operation are rarely included in loyalty strategies, yet it’s a vital consideration during implementation (and more on operation later!).

2. Select the loyalty platform that suits your vision, existing tech stack, and culture.

Selecting the right loyalty technology solution is key to delivering the programme's features and providing a seamless experience for both customers and the business. When you choose a new loyalty platform, consider these five criteria which I used when evaluating loyalty (and other tech) platforms:

• Objective: Ensure the technology, scalability, and features of the platform align with your programme objectives, functionality, timeline, and budget.?
• Integration: Integrating loyalty platforms with the existing tech stack provides a seamless experience for your customers and enables real-time data flow. Therefore, ensuring the loyalty platform is compatible with and has experience integrating with your systems, such as POS, CRM, CDP, and e-commerce platforms is important.
• Innovation: A loyalty programme requires continuous optimisation and new features. Choose a platform with a strong innovation pipeline and flexibility to keep your programme dynamic and engaging.
• Data: Effective data collection, storage, and analysis are cornerstones of a modern loyalty programme. Ensure the platform supports robust data management and complies with data privacy regulations like GDPR.?
• Culture: Implementing and optimising your loyalty programme means working closely with the platform. Choose a platform that shares similar values, drive, and culture to make the process smoother and more enjoyable.

3. Work on data early!

Data is hard, messy, and time-consuming! So make sure you involve the relevant teams early on so you are collecting the right data through the right channels. An important task for loyalty leaders is to decide on how you want to use the data. Here are some common use cases:

• Segment customers: Divide your customer base into distinct groups based on behaviors, preferences, and demographics to tailor your marketing efforts.
• Track and measure key metrics including customer acquisition cost, retention rate, redemption rate, and program ROI.
• Identify trends and patterns: Analyse purchase behavior to uncover trends, such as peak buying times, popular products, and high-value customers.
• Personalise offers and rewards: Trigger tailored offers and rewards for individual customers, enhancing their loyalty experience.
• Predictive analytics: Anticipate customer behaviour, such as the likelihood to churn, and proactively address it with targeted campaigns.

4. Loyalty programme won’t succeed if you don’t communicate it properly.?

You cannot operate a loyalty programme without communication. And you need communication via different media channels to drive awareness and acquisition, as well as keep customers consistently engaged.

The first crucial aspect revolves around building awareness of the loyalty programme and driving acquisition, which needs to give customers a reason to use it. There's a saying I've come across, "simplification for amplification" which holds a lot of truth when it comes to marketing communication. Loyalty programmes and their mechanics can be intricate, but it's marketers’ responsibility to simplify them for comprehension. When you craft the acquisition communication, try to summarise it for some colleagues who are unfamiliar with the loyalty programme. If you find it challenging to condense it into a five-word sentence (and make it appealing), it's likely too complex.

The second key aspect is the CRM communication. When I developed the new loyalty programme, I and my team also established automatically triggered communications in parallel, to educate customers about the programme and nudge the desired behaviours. For instance, we crafted a "Welcome" journey aimed at prompting customers to utilise the programme immediately upon sign-up. A series of "Reminder" emails were designed to gently encourage customers to redeem their rewards, thus incentivising return visits to restaurants. This communication strategy is of paramount importance – we can’t rely on customers’ memory to use a loyalty programme. Whenever launching a new product, it's crucial to consistently reinforce the message until it becomes ingrained in customer behaviour.

5. Train the teams.?

Many loyalty programmes have sound propositions and strong customer-facing communication but encounter issues when customers attempt to use them in stores. If the Operations Teams in stores are not equipped with the knowledge to assist customers when things go wrong, the programme can fail. Therefore, it is crucial to involve the Operations Team early on and provide them with proper training. Furthermore, by engaging the Operations Teams early on, they become powerful advocates in the stores. Imagine the ripple effect: tens of thousands of potential advocates ready to champion your loyalty programme, amplifying its impact across your entire network!

Additionally, ensure that the Customer Service team is well-informed and has the right protocols to handle complaints regarding the loyalty program. No brands or businesses like complaints, but managing complaints swiftly and sincerely can turn a negative experience into a positive one. And all of this requires preparation in the developing phase!

6. Put in place a solution to detect and prevent fraud.

According to an industry report, loyalty fraud can lead to estimated annual losses exceeding $1 billion across various industries. This staggering figure can be reduced with appropriate measures. Collaborate with your Technology team to develop robust solutions for detecting and preventing fraud during the development phase.

7. Get great project management.??

As I mentioned earlier, developing and launching a loyalty programme is a complex project. Strong project management can significantly enhance the success of the launch. While some loyalty leaders might have the luxury of a dedicated project manager, more often than not, you'll find yourself managing the entire process on your own (like I did). It’s worthwhile to review techniques and tips on Change Management and Project Management.

Here are a few strategies that have been incredibly beneficial for me:

• Involve Different Functions Early: Engage various departments as early as possible, and ensure everyone understands the programme's objectives and knows what you expect from them.
• Think Through Dependencies: Carefully consider dependencies when building your project plan. I’ve fallen into the “trap” of dependencies once, where the entire project had to pause until a dependent task was completed. This can be stressful and disrupt momentum. It is critical to prioritise completing dependencies to keep the project on track.
• Allow Extra Time for Senior Stakeholders’ Alignment: “Managing up” is a crucial aspect of project management. I sent out weekly updates and held Steering Committee (Steerco) meetings every four weeks. This helped massively with decision-making and removing barriers. However, senior stakeholders are not as close to the project details as you are, so it's important to educate them on the context and issues, and give them sufficient time to understand and assist you.

FINAL THOUGHTS

As you embark on the journey of implementing your loyalty program, remember that the bridge between strategy and success is built on execution. Every step, from mapping out the end-to-end customer experience to selecting the right technology platforms, requires meticulous planning and agile adaptation. With clear communication, robust project management, and a keen focus on data integrity and fraud prevention, you're not just implementing a program – you're creating lasting connections with your customers and laying the foundation for sustained business growth.?