The Power of Loyalty
Tom Smith M.Sc.
SaaS Sales Executive | Driving Revenue Growth for CPG, Restaurant, eCommerce, Entertainment & Retail Brands
TGIF, Everyone! I wanted to share a link to an excellent article that was recently published by McKinsey. This subject again is very near and dear to me, as professionally, I am often charged with helping brands accelerate their loyalty program sign-ups.
In this article, McKinsey notes:
"Why Loyalty Matters - 3 out of 4 members of top-performing loyalty programs changed their behavior to generate more value for businesses"
- "64% are more likely to purchase more frequently"
- "50% are more likely to recommend to others"
- "35% are more likely to choose brand over competitors"
- "31% are more willing to pay a higher price to stay with a brand"
Source: McKinsey & Company Loyalty Survey, McKinsey, 2021
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What I REALLY like about this article is that it also further speaks to WHY NOW. ONE of those specific reasons speaks to what I have been evangelizing about why CRM should become an INCREASINGLY important path for marketers:
"Drastic shift in access to third-party cookies and identifiers. Companies without a fallback privacy-centric infrastructure (eg first-party data, data clean rooms) are likely to spend 10–20% more on marketing efforts to make up for loss of third-party data resulting from new regulations and policies."
One final note / word of caution -- Many times when I speak with companies, I unfortunately see a "drop everything" mindset when it comes to loyalty. Just because a brand has implemented a loyalty program doesn't mean they should stop most other marketing / advertising efforts. It is not an excuse to drop everything else that you are doing to save $$$. Loyalty programs should provide you the first-party data to help you spend your marketing $$$ more efficiently.....
Keep filling the funnel with new sign-ups, collect the data & then personalize the consumer's experience -- You will reap the rewards :)
Tom Smith
Tom Smith is Director, Client Partnerships with SKUx, an innovative fintech company redefining the way consumer offers are delivered, redeemed, settled and reported. In his role, Tom helps leading brands collect more first-party data so that they can better engage with their prospects and customers & ultimately improve the profitability of their marketing efforts. To learn more about SKUx, visit: www.skux.io **
** Any opinions and views expressed in this post are my own and do not necessarily represent the postings, strategies or opinions of SKUx.
Hey Tom; I just read your comments on the McKinsey report on Loyalty. As someone that has sold well over 50 Loyalty programs to brands I thought I would chime in. To me, Loyalty programs are a way to identify it's customers and recognize their status to create a more profitable relationship. I like getting on a plane and being thanked for my Diamond status or given a simple bottle of water due to my status at a hotel. Yes, loyal customers spend more and will evangelize for that small perk. I have seen customers struggle with the value they offer for the loyalty program consumer. I think the #1 thing is recognition, a very small thank you goes a long way.
Husband | Entrepreneur | Investor | Recording Artist Turned Techie | Difference Maker #anchorlovemission
2 å¹´Yes sir! #marchtoabillion
Strategic Consultant | Client Relationship Manager
2 å¹´Tom Rocca Alexandria Rocca right in our wheelhouse for our discussion next week