Retail loyalty programmes. This is a subject that often comes up in conversations we have with our client brands and it's a topic that keeps the conversation going for a long time without reaching much consensus. Everyone basically has their own ideas on how to reach the holy grail and win over the hearts and devoted loyalty of their customers, but the truth is that even luxury brands, which are already at a very advanced "jedi" level, don't neglect their programmes. And if there are devoted customers, we'll certainly find plenty of them in the luxury industry. But is that all?
Customer loyalty can be understood as an ongoing, mutually beneficial relationship between a customer and a brand. This relationship is normally seen through the frequency with which a customer is willing to interact with our company/brand and make repeat purchases due to the benefits they perceive in relation to the competition. However, in our opinion, there is also an important variable that deserves to be included in the definition of this concept: intensity. Created, driven, and activated by the more emotional side of our customer's being, the intensity of the way the customer relates to the brand, positive or negative, helps the loyalty process to be supported, progressed, expanded, stagnated, or reversed.
Customers who experience frequent proximity relationships with a brand are more likely to become loyal to that brand, but when we add intensity (positive, by the way) to this variable, we create the fan. Think of the queues of customers waiting to get into certain stores - YOU KNOW WHICH ONES - for the latest item or just to ... go in and see, or be seen...
Based on the positive experiences and benefits that customers derive from interacting with your company, this intensity and frequency, if positive, will increase and, of course, be reflected in sales. Loyal customers are unbelievably valuable because they generate revenue and increase brand reputation. They are willing to spend more than new customers, share their comments and frequently participate in referral systems. What's more, it's much more cost-effective to keep existing customers than to acquire new ones. The best way to create loyalty is through a combination of appreciation, a sense of belonging, shared experiences, social connections, gamification, and feelings of nostalgia. If we add to these a well-dosed component of promotion, price, i.e. benefit, we have an open field for a good loyalty programme.
Successful loyalty strategies often combine one or more of these approaches to create a comprehensive and captivating experience for customers, generating empathy and loyalty on the part of the customer and, if done well, perhaps even creating fans!?
In this article we present 10 killer strategies for doing this successfully, we challenge you to think about it and join us in the discussion, let's go:
- Loyalty programmes: These offer rewards, discounts and other exclusive advantages to customers who shop often or engage with the brand. Loyalty cards, points systems and membership levels are common examples. Today, these strategies are increasingly being converted to a digital format - hardly anyone uses physical cards anymore. Apps and digital cards and accounts are leading this trend, making everything simpler, more convenient for the consumer, with often immediate rewards and, for brands, the possibility of having customer information linked to a CRM or other forms of communication and promotion.
- Personalised offers:? Using customer data and knowledge, retailers tailor offers and promotions to individual preferences and purchase history. Personalisation improves the shopping experience and strengthens customer loyalty. Knowing the customer and adapting the offer in a targeted and exclusive way through progressive personalisation is especially important but not easy. As we've mentioned in previous articles, it requires good data capture and processing and that takes time and resources.? There's nothing worse than wanting to sell the customer everything and anything and more without them needing it or showing any interest in it. It's a complete nuisance.
- VIP programmes: VIP or premium membership programmes offer exclusive advantages, first access to sales, dedicated events, or personalised services to top customers. These programmes often create a feeling of exclusivity and reward high-value customers.
- Gamification: Incorporating game elements such as points, badges or challenges into the shopping experience can make it more engaging and fun for customers. Gamified loyalty programmes can encourage repeat visits and increase customer interaction with the brand.
- Referral Programs: Encouraging existing customers to refer friends or family members to the store in exchange for rewards or discounts can help attract new customers while rewarding loyalty among existing ones.
- Community engagement: Creating a community around the brand through social networks, forums or events promotes a sense of belonging among customers. Engaging with the community, responding to their needs, and asking for feedback can strengthen loyalty and brand defence.
- Omnichannel experience: Providing a seamless shopping experience across multiple channels, such as online, mobile and in-store, ensures convenience and consistency for customers. Loyalty programmes and rewards should be integrated across all channels to maximise engagement.
- Surprise and delight: unexpected rewards, personalised messages or gifts can surprise customers and create positive experiences that increase loyalty. These gestures show appreciation and can leave an impression on customers.
- The power of feedback: Actively asking for feedback and listening to customers' concerns helps retailers better understand their needs and preferences. Implementing changes based on feedback shows that the retailer values the customer's opinion, fostering trust and loyalty.
- Data-based information: Using data analysis to understand customer behaviour, preferences and trends allows retailers to effectively adapt loyalty strategies. By analysing purchasing patterns and engagement metrics, retailers can optimise loyalty programmes and offers for maximum impact.
