Why Data Management is Key to Any Successful Loyalty Program
The best customer loyalty programs introduce tangible value to a customer via real-time, accurate updates and new service offerings. Typically, this value comes in the form of points, providing customers with flexibility in how they’d like to cash them out. Done right, loyalty programs can boost revenue by up to 25 percent annually.
However, creating a successful loyalty program is no easy feat, especially if the program includes partnerships with other brands or credit card networks, which require aggregating data from outside sources. Legacy systems often can’t spin up workloads fast enough to provide users with a seamless experience.
The key is data responsiveness. Brands that take the time to improve their data responsiveness can elevate their loyalty program and deliver more value to customers.
Let’s look at three ways in which effective data management makes an impact on companies' loyalty programs.
Resilient loyalty programs don’t wait for the user to make a request in the app; the data is already available and up-to-date so customers don’t experience latency. If data batches only update once a day, it limits what a brand can execute with that data and risks frustrating customers with slow or no updates.
A seamless experience in retrieving data pays off not only in satisfied customers, but potentially a bigger audience. According to the Loyalty Report 2021, 73 percent of consumers are more likely to recommend brands with good loyalty programs, and 80 percent say good programs make them more likely to do business with that brand.
Don’t let poor data responsiveness take a toll on your loyal customers when it could potentially increase your program’s engagement levels and profitability.
Aggregating data can also lead to latency, compromising your customers’ experience. If points from a partner purchase aren’t reflected quickly, the user can’t rely on the balance you display. Brands may not realize just how big of a pain point this is for users: According to Clarus Commerce’s 2022 Customer Loyalty Data Study, 64 percent of customers check their balance once a month, and 36 percent check on a weekly basis or more frequently.
By incorporating a digital integration hub (DIH) into your existing IT architecture, you can replicate data as transactions occur within systems of record, constantly feeding apps with fresh data and enabling users to always see their most accurate balance. The good news is that retailers are ahead of the curve when it comes to the ability to pull this off. According to The State of Security 2022 report from Splunk, half of retailers have a cloud-first policy for new applications, compared to 38 percent of organizations across other verticals.
Efficiently Launching New Digital Services
The bar is constantly being raised when it comes to new innovations that improve customer experience. Many retailers are branching out and partnering with other brands to keep their customers happy, resulting in new digital services that increase the workload on their existing IT infrastructure. The more partnerships that are created, the messier a brand’s infrastructure can become with that new data.
A DIH serves as a middleware that simplifies repeated data requests and allows teams to quickly adjust that data for faster development cycles. The payoff here is clear: 84 percent of consumers in a Bond Brand Loyalty study said that being able to instantly redeem points for purchases at other merchants improved their experience.
That’s every retailer’s ultimate goal: delivering a better experience. It all starts with data. When you prioritize data responsiveness you can ensure low latency, develop integrations, and launch new services, all of which make your loyalty program more valuable for customers, attracting new prospects and keeping them all coming back.
Adi Paz is the CEO of GigaSpaces, an in-memory digital integration hub.
Related story: 2021 Loyalty Program Benchmark Report