Loyal customers tend to buy more and advocate for their preferred brand or retailer. But, that trust and advocacy don’t come easy. Brands and retailers looking to establish loyalty and reap the benefits should consider how they currently communicate with customers. Do customers feel their feedback is welcomed and valued? Are their wants and needs considered?
Loyalty, sales, and trust go hand in hand—it takes trust to make the initial sale, and it is an expression of trust when the customer returns. An effective customer loyalty marketing strategy will be aimed at retaining customers and deepening the relationship between brand and consumer.
Developing a Customer Loyalty Marketing Strategy
Consumers and brands agree on the primacy of price and quality as loyalty drivers—the elements that are usually defined as value. That is undoubtedly the foundation for a loyal relationship between brand and consumer, but it’s not all brands and retailers can do to provide a high-value proposition. In the competitive atmosphere of today’s retail landscape, having a good product is a good start, but consumers are often looking for more than that.
Bring Value to the Table
- Service counts. When asked what brands can do to improve the consumer experience, the top answer from consumers surveyed in one report was “better service from staff.” Seventy-four percent of respondents said a bad experience with sales staff makes the whole transaction bad.
- It pays to listen. In the same survey, 70% of consumers said they want brands to listen to them. However, only 26% of brands said they have direct conversations with customers. There are abundant ways to communicate with consumers:
- Customer support—while an easily accessible human representative is still considered the gold standard, that perception may be changing. A study of global Facebook data found that 56% of those surveyed would rather message than call customer service. In a separate survey, 36% of consumers said they expect to receive customer support from a chatbot.
- Feedback—providing a forum for feedback gives the customer a voice and provides the brand or retailer with an opportunity to gain valuable data and cement their relationship by responding to feedback. When Gap Inc. introduced its direct-to-consumer clothing brand, Hill City, in 2019, the marketing model relied on the idea that anyone could message the company and become a product tester. The company received an overwhelming response from consumers—30,000 people when they expected 500—creating a sense of community and making customers feel the company is trying to understand them rather than throw ads at them.
Cement the Relationship with a Loyalty Program
Making a brand-consumer relationship official with a loyalty program gives a brand or retailer more opportunities to nurture that relationship. Some brands and retailers have been so successful that they added tiers to their programs to acknowledge top customers. Sephora, for example, added two upper tiers to its loyalty program in 2019, after 12 years of existence, to “show appreciation for its most loyal clients.”
In exchange for rewards—which could range from gift cards, free services like shipping, or experiential rewards, such as special events—brands and retailers can expect a loyalty program member to spend 67% more than a nonmember. In 2017, Amazon Prime members spent an average of $1,300 each, compared to an average $700 spent by nonmembers.
Loyalty program members also provide a wealth of data in their spending habits, as well as in the information they provide when they sign up. Besides creating a more detailed picture of the customer base, this information can be used for personalized offers, such as Sephora’s “Just for You” pages, which are generated based on purchase history.
Leverage Mobile to Reward Loyalty
To keep up with the ways in which mobile technology has improved the customer experience, brands and retailers should consider hosting their loyalty program through an app. Customers no longer want to shuffle through tons of loyalty punch cards in their wallets. Instead, apps have been gaining in popularity for several years, with 44% of consumers expressing a preference for them in 2019, up from 20% in 2016. However, when designing a loyalty program, brands and retailers should consider a common drawback: loyalty fatigue. With dozens of programs to choose from and participate in, the U.S. consumer has an average of 14.8 memberships and is active in only 6.7 of them. Partnering with a third-party customer loyalty rewards app could combat this fatigue.
Shopkick Engages Customers Without Fatiguing Them
Shopkick, a third-party customer loyalty rewards app, can be used to motivate customers to make purchases through incentives and combat loyalty fatigue, as customers have access to multiple brands and retailers in one app. Here’s how the rewards platform works: Shopkickers begin their purchase journey by browsing engaging in-app content from several brands and retailers, whether they’re at home or on the go. This content includes curated lookbooks, informative video ads, and more. For partnering brands and retailers, this content helps build pre-shop awareness and consideration and puts products at the top of shoppers’ minds.
Users can check the Shopkick app to see which brands or retailers offer “kicks,” or rewards points, which incentivize shoppers to visit a store or browse online. In-store, Shopkick utilizes an engaging gamification strategy that drives shoppers to products at-shelf and encourages physical product interaction in exchange for kicks. This allows brands to boost product awareness when it truly matters most—in-aisle, with the product in hand. By offering users an additional kick incentive for making a purchase, Shopkick closes the loop and drives sales. Eventually, Shopkick users redeem their kicks for free gift cards, which builds a positive affinity and loyalty for the brands and retailers that awarded them.
Shopkick takes the hassle out of implementing a customer loyalty marketing strategy.
Due to its already-loyal base of users, Shopkick offers partnering brands and retailers an opportunity to build onto the trust it’s already established with consumers. Because of this, Shopkick takes the hassle out of implementing a customer loyalty marketing strategy.
Image courtesy of 13_Phunkod