Can rewards buy loyalty?
Every quality relationship is based on trust. And, it doesn't matter if we are talking about our relationship with another person or something apparently far less important in life, such as, say, a brand. It doesn't even have to be our favorite, although positive emotions play an important role in building a lasting relationship. From trust comes loyalty, and loyalty - feel free to use the word that "suits" you more. Think: Would you ever stay with someone if you didn't feel you could trust them and if the relationship wasn't mutually beneficial?
Between trust and loyalty are experiences. Any experience that produces a feeling of satisfaction and is repeated regularly creates an emotional connection. And that is exactly your ticket to success. So, everything is a matter of psychology. Do you want customers to be loyal to you, to return to your brand again and again, and to choose your brand in a sea of competition every time? All you have to do is follow the path described above. (Any resemblance to classic media titles is intentional.)
Existing customers in focus
When we talk about customer loyalty, we should keep in mind that it is much simpler and cheaper to focus on those who have already interacted with your brand than to invest efforts in gaining new ones. That is the point - you should reward those who are with you. But, to do this in an adequate and effective way, it is important to really get to know them. This doesn't mean only collecting personal data like names or dates of birth, but also understanding their interests, needs, habits, and shopping philosophy - whether they buy online or offline, how often they buy, what they buy, what happens after purchases, and the like. Only in this way is it possible to manage the business to achieve the desired results in the long run.
Pleasure is the key
Customers are loyal when they are satisfied with a product or service, and when their user experience is excellent. They value quality, see the brand's identity through the prism of their own identity, and connect with it based on goals and values. When they feel that the brand respects their needs, when they feel valued and seen on a human level and not just as targets, they will not leave. Additionally, a satisfied customer will be happy to share their positive experience with others, and the potential of such "word of mouth" marketing is immeasurable.
However, there is an important difference between consumer loyalty and consumer habits, and the easiest way to test them is by changing the price of your products or services. Customers loyal to the brand as such will have no problem paying more for what suits them, regardless of what the competition offers. Customers who don't care which brand they buy from, as they don't identify with any of them, will go for a better offer without thinking. In the long term, no one will profit from those who chronically change the brands they interact with. The goal of building loyalty, therefore, should be sustainability and a permanent change in consumer habits, and it is believed that this can be achieved precisely through building common values.
The purpose of the loyalty program
Expecting a customer to stay loyal to you forever may be a bit utopian. Yes, your relationship rests on something that is fundamentally impossible to buy, but even then, a small token of attention as a form of gratitude and recognition will not be refused by anyone. Loyalty programs exist so that brands can show their customers that they appreciate being with them, but before you decide to announce another discount, try to think more strategically.
Research has shown that 77% of customers stay with a brand that has a good loyalty program, and 70% of them would recommend it further. As many as 63% of customers are ready to modify their spending habits to get the most out of the loyalty programs they belong to. But what does a good loyalty program look like? The question to be asked is not a general one like "what do your customers need," because all those things they need can be found anywhere and in different places. The question to ask is which of their needs can your brand fulfill so that they are satisfied while you profit? So, it is a win-win situation for both parties.
Why Loyalty Programs Don't Work
The aforementioned is actually not so easy to achieve - the challenge is to create a program that will understand the needs and desires of users in the right way and enable their fulfillment. On the other hand, the brand must also take care of its goals - loyalty programs can often represent a large expense and essentially not bring a relevant result. For example, the discount you currently provide can attract both old and new consumers, but nothing can guarantee that they will return or that they will come more often after the promotion. And this is another confirmation that, in this sense, your plan should be long-term.
Not all customers are the same. After all, that's why loyalty programs exist - to make a difference between those who are loyal and those who are only there when it suits them. It is true, on the other hand, that it is easier for smaller brands to identify customers who are important to them since the circle of people is smaller and the relationship with them is more personalized. This brings us to perhaps the biggest challenge that loyalty programs face and because of which they are often not successful - the absence of personalization. It has already been mentioned that each of us wants to be seen and recognized as a real person, and not viewed as one of the figures of a marketing target. groups. Customers need to feel that they are important to the brand, that the brand recognizes this, and therefore wants to reward them with benefits that no one else has. That is why it is important to get to know those with whom you communicate, and it is important to conduct that communication strategically and humanely.
Help from Technology - Help from Friends
In addition to the personalized experience and exclusivity of benefits, ease of implementation of loyalty programs for brands and ease of participation for consumers are critical to success. And we are more than interested in avoiding any kind of complications! How do I achieve this? Simple - the solution is in technology. And when we say "technology" - we mean artificial intelligence. The field of application of artificial intelligence is expanding every day, and the reason for this is its undeniable power to improve almost every aspect of our business. And yes, it can be used to improve the loyalty program.
Marketing agency Smartpoint has developed SmartApp, an innovative loyalty platform based on artificial intelligence, that offers a complete solution for the successful implementation of each segment of the loyalty campaign. In this way, the goal we strive for (which is better results and satisfaction for customers, participants in a given campaign) is guaranteed. SmartApp is quickly implemented, which saves time and simplifies the process of implementing the program, while the users themselves will be delighted with the ease of use. The campaign itself can be corrected and adjusted at any time, and the results can be monitored in real time.
Remember the story about trust? Probably the biggest advantage of the SmartApp platform is precisely the desire to make the loyalty program as fair as possible - thanks to an advanced algorithm for extracting information from images, including scanning accounts and detecting potential fraud, equal chances are provided for all participants to win their prizes. The selection of winners is fast, impartial, and precise. With the impossibility of sneaking the slightest mistake in the entire process, consumers will have more faith not only in your loyalty program but also in your brand.
Loyalty as an Imperative
Today's market is highly competitive, and in the constant struggle for development and success, having someone on your side is important not only in good times but also in challenging ones. Even then, it may be crucial. A brand cannot exist without customers. Loyal customers. But in order for them to trust you, they must have a reason for trusting you. Try to make it good.
Text written for the InStore magazine by: Ivana Tomić, smartpoint adria Brand Specialist
Photo: Unsplash