The Future of Loyalty
Over 50 percent of adults in high-income households (earning $200K or more per year) are willing to switch brands in order to — wait for it — use a coupon? And 47 percent of consumers are likely to switch brands within 24 hours of receiving bad customer service.
In this day of promotion, price sensitivity and instant gratification, is the concept of loyalty officially dead?
Savvy marketers know the value of authentic customer advocates to drive repeat purchases, lower acquisition costs and maximize profits. To create loyal customers, you have to acquire them first. When you do get them, how do you keep them?
A recent McKinsey Research study reveals the average household signs up for over 23 reward programs, with promise of exclusive offers, discounts and coupons. While 94 percent of consumers sign up for at least one brand loyalty program, only half of the programs are used.
Loyalty programs should be focused as much — if not more — on retention as acquisition. Keeping customers “meaningfully engaged” has the strategic importance to loyalty programs that year-round practice has to a team laser-focused on winning the World Series. Let’s face it, consumers are fickle. Their preferences and interests change as quickly as they can swipe left inside an app. Here’s the good news: the faster customers earn/spend their loyalty points, the sooner they'll come back, shop and earn some more.
An arguably parallel opportunity lies in activating loyal advocates. These customers’ words lend credibility to your brand’s promise and quality. The more sharing chances you create — directly/indirectly earning your loyalty points — the more people will share.
Your company's loyalty program should drive brand engagement by promptly rewarding customers across the overall customer experience. Giving shoppers more ways to earn and more reasons to spend gives advocates more sharing opportunities and talkers more reason to share more feedback and motivations.
Create more “talkers” by rewarding shoppers with a unique opportunity to earn more points by sharing authentic feedback and opinions on products and services. The future of loyalty lies not just in rewarding shoppers for their purchases, but in the time they spend on your website or app.
Noman Ali is the CEO of Peanut Labs, a provider of online market research, social monetization and advertising services.