Are Retailers Improving on Delivering Mobile-Based Loyalty Programs?
Most retailers today are now utilizing mobile in some shape or form to enhance the shopping experience for consumers — both online and in-store. A select few have completely embraced the channel and are truly mobile-first, reaping the benefits — think Starbucks. Mobile technologies, including mobile point of sale and mobile scan and payment technologies, are getting integrated into retail environments each day.
One additional area that continues to see growth is mobile-enabled loyalty programs.
This is a good thing for retailers, as consumers say that these programs actually motivate them to make purchases more often. In the 2017 Mobile Loyalty Report, 62 percent of consumers say mobile loyalty programs influence purchase behavior, up from 59 percent registered in the prior year.
Retailers also continue to use the power of mobile for their coupon programs, recognizing that mobile represents a brighter future than paper-based coupons. Consumer interest in mobile-enabled coupon programs grows each day, particularly since it makes shopping in-store easier by removing the hassle of having to print coupons at home and remember to bring them to the store.
In fact, 36 percent of consumers have increased their use of paperless coupons so far in 2017, according to Valassis.
Brands Began to Take Notice and Action
According to the Mobile Loyalty Report, brands saw a 64 percent increase in loyalty membership in 2017, and cited the addition of mobile components as the biggest contributor to this increase. Brands are listening to consumers and adding mobile functionality, such as clip-to-card couponing and digitizing loyalty cards, in order to keep pace with their customer. They also started using SMS to communicate more often — 27 percent of brands in 2017 vs. 21 percent in 2016.
Continuous Barriers to Entry
Not all brands and retailers have jumped into the world of mobile-enabled loyalty. The report also highlighted the largest barrier retailers face in preventing the integration of a mobile loyalty program: the lack of the right skill sets in order to do so. In 2017, 81 percent of brands and retailers said without these skill sets, they’re struggling to make the investment in a mobile loyalty program, up from 71 percent a year earlier. However, there are simple ways to get started and brands need to develop a now, near and next road map in order to begin develop and deploy a strategy that meets their customers’ needs.
Signing Up for Programs and Ongoing Communications
Despite the growth seen by brands and retailers over the last year, there remain some challenges for those businesses that do offer a mobile loyalty program: the sign-up process. Customers report they would be more likely to sign up for a mobile loyalty program if the sign-up process was simplified. In 2016, 72 percent said there was too much involved in the sign-up process, and while this number dipped slightly to 66 percent in 2017, it still represents approximately two-thirds of consumers. The amount of information required at sign-up is a good place to start in resolving this issue. Sixty-two percent of consumers said they felt the sign-up process generally asks for too much personal information.
As far as ongoing program communications, brands and retailers see value in leveraging SMS text message channels to communicate loyalty program updates. In 2016, 21 percent of consumers said SMS was their preferred channel for communications. This number grew to 27 percent in 2017, clearly showing that brands and retailers should continue to invest in SMS messaging.
Where Do We Go Next?
Brands and retailers have many features to consider adding to their mobile loyalty programs. Technologies and features such as intelligent assistants (e.g., Apple’s Siri or Amazon’s Alexa) represent a growing channel with consumer demand. Other opportunities for expansion include additional personalization; chatbot integration; and messaging apps such as WhatsApp, WeChat, and Kik.
Margie Kupfer is vice president, marketing at 3Cinteractive (3C), a mobile marketing company.
