Three enablers for a successful loyalty programme

Not long ago, I had the privilege of revamping the loyalty programme for one of the world’s most iconic brands. Through every stage, from defining the strategy to designing the mechanics and developing the go-to-market plan, I have gained invaluable insights.?

Reflecting on my experience, I’ve come to understand that a successful launch (and overall success) of a loyalty programme requires more than just a clear value proposition, a sustainable financial model, and a distinctive brand identity. It is equally important to have foundational “enablers” in place early on. In this article, I want to highlight the three most important enablers for the successful launch and the ongoing success of loyalty programmes.

Engage with the Operations Team and Customer Service Team early on.

One of the biggest revelations from my own experience was the extensive cross-team collaboration required to ensure the successful launch of a new loyalty programme. Some functions are obvious:? The Finance Team is essential for defining loyalty economics, and the Technology Team is indispensable for bringing the loyalty programme to life, and the Marketing Team helps to ensure a consistent brand experience for customers. However, the two teams who play a determining role tend to be left to last.?

The first one is the Operations Team. Many loyalty programmes have sound propositions and strong customer-facing communication, but have issues when customers attempt to use them in stores. For example, if the loyalty program requires users to scan a QR code in an app, what happens when the scanner fails to work? If the Operation Teams in stores are not equipped with the knowledge to help customers when things go wrong, the program can fail.? . Therefore it is crucial to involve the Operation Team early on. Their insights are instrumental in crafting a seamless customer journey and pinpointing any potential glitches in in-store experiences. Furthermore, by engaging the Operation Teams in the design process, they become powerful advocates in the stores. Imagine the ripple effect: tens of thousands of potential advocates ready to champion your loyalty program, amplifying its impact across your entire network!

The second team is Customer Service. The Customer Service team works at the front line of the customer experience, and they have a wealth of knowledge about customers and their needs. I was fortunate to collaborate with a colleague from the team when designing a new loyalty programme. We discussed extensively on desired features, the end-to-end customer journey, and communications. Her honest feedback proved invaluable in refining the customer experience. As is often the case, we marketers tend to get swept away by the excitement of new features and products (and who can blame us, really?), occasionally missing potential pitfalls along the way. That's where having a colleague who's a master of uncovering every possible edge case becomes our indispensable sidekick!

Set up technology capability for optimisation?

Talking about optimisation before launching a loyalty programme is hard mentally - which loyalty leaders don’t want the shiny new programme to be perfect? However, the reality is that until the loyalty programme is launched in the market, you just won’t be certain how customers will react. And the assumptions used in designing mechanics and calculating the economics are likely to be wrong. Even the best-thought-through programme needs tweaks and updates.

That’s why it is important to ensure the loyalty programme is built with easy reconfigurability in mind. Building a loyalty mechanic is establishing orders, such as "issue 100 points when a customer spends more than ￡5," or "give the customer a free drink when they redeem 1000 points". If these rules are easy to modify on your technology platforms, the loyalty team can optimise them based on real customer data post-launch. (To be frank, if you can’t change these values later, you will be SCREWED!) The flexibility to adjust loyalty mechanics is essential for ongoing programme optimisation and the success of a loyalty programme.?

The foundation of a modern loyalty programme is DATA!

I know I have talked a lot about data in previous articles. But in my opinion, data is the one that sets apart traditional “stamp cards” from modern loyalty programmes, and maybe the one that sets you apart from your competitors!?

The strategic thinking on gathering and using data should start when designing the loyalty strategy. In the data strategy, you need to articulate:?

What use cases require data? For example, you will need data to track and optimise the performance of the loyalty programme, and you will also need data to calculate customer value and personalise your offers. In addition, many businesses have started integrating the 1st party data into media channels for precision targeting.?

What data do you need for the above use cases?? And where do you get it? In many cases, you will need data from multiple sources to get answers to your questions. Therefore, working with the relevant teams early on to gather correct data will set a strong foundation for your loyalty programme.?

FINAL THOUGHTS

Defining a clear value proposition, establishing robust loyalty economics, and maintaining a consistent look and feel are essential cornerstones for any loyalty program. However, a successful launch requires extensive collaboration with other functions, so it's crucial to engage with them early on in the process. Additionally, ensure that the loyalty mechanics are easy to update to facilitate optimisation as needed along the way. Lastly, a loyalty programme is powerful because of the data and insights that it can leverage. Therefore, thinking about the data strategy early on will make your loyalty programme truly customer-centric and personalised.?