Customer loyalty programs often need to catch up in engaging customers. However, with card-linking, retailers and merchants can design more effective...
Maximizing loyalty programs: key strategies for product and marketing managers
Launching a loyalty is just the first step. Unfortunately, many loyalty programs fail after launch. To unlock the most potential out of it, product and marketing managers must differentiate their program from their competitors.
In today's fiercely competitive market, launching a loyalty program is only the beginning of a journey toward enduring success. The true challenge lies in maintaining the distinctiveness and appeal of your loyalty program long after its initial launch. It's imperative for product and marketing managers to not only retain current customers through these campaigns but also to attract new ones.
In this article, we explore key strategies for marketing managers to ensure their loyalty program remains effective and engaging post-launch.
Loyalty programs are everywhere, and that’s because they can be very effective at attracting and retaining customers - about 69 percent of customers say their choice of retailer is influenced by where they can earn customer loyalty/rewards program points. However, only a few loyalty programs end up being successful. The key differentiators of which programs work and which do not are:
- Program clarity and simplicity,
- Streamlined enrollment and onboarding,
- Responsible data security and privacy, and
- Personalization and aligning with customers’ needs.
Clarity and simplicity: the cornerstones of your loyalty program
How easy is it to understand how your program works? Is it intuitive? Is there a list of rules? How much is 1,000 points anyway?
The first impression of a loyalty program is pivotal. As a product or marketing manager, crafting a program that is straightforward and easy to grasp is essential for fostering customer engagement.
Approximately 38% of customers are hesitant to join loyalty programs due to a perceived lack of value. Therefore, it is crucial to communicate the program's benefits clearly.
For instance, if your program offers cashback rewards, details like reward amounts and eligible purchases should be explicitly outlined. Information such as reward type (flat rate or percentage), minimum spending requirements, and other relevant specifics must be transparent.
Consider creating a dedicated landing page that details the campaign's duration, usage instructions, and direct contact information for inquiries. A well-crafted landing page not only converts visitors into customers but also boosts your overall SEO strategy, leading to organic growth as well as a way to track messaging and traffic.
Streamlined enrollment and onboarding: get started sooner
How easy is it for customers to enroll and onboard? How long does it take? Will they have to wait 2 business weeks in order to receive a physical card?
The effectiveness of a loyalty program greatly depends on its enrollment process. Opt for simplicity. Cumbersome processes with multiple steps or the necessity for specific loyalty cards can deter potential participants.
Technologies like card-linking can streamline the enrollment process, allowing customers to earn rewards immediately without the hassle of multiple cards or coupons. It’s vital to communicate the ease and benefits of joining the program to your customers.
Shameless plug: on average, it takes Olive-powered programs about 10 seconds to enroll a customer with an existing card. Compare that to the process of ordering and waiting for a whole new card.
Build trust with top of the line data security
As Evan Snively aptly puts it, "Customers won’t open their door to a deeper relationship, especially one that requires them to provide more data, if they don’t trust your brand."
Ensuring robust data security measures and transparently communicating them to your customers is fundamental in building trust and encouraging participation in your loyalty program. Especially as customers become more attuned to how their personal data is being used, your loyalty program will have to show and prove that it is taking good care of their trust.
While there are several data security concerns you should consider, two key considerations when launching a loyalty program are:
- Are you collecting and storing personal information about your customers?
Collecting and storing identifiable personal information (PII) is a major cybersecurity risk as data systems can be, and regularly are, breached. It can place your organization at legal risk if you are not compliant with personal information laws.
Learn more about how Olive protects PII here.2. Do you need customers’ banking credentials for enrollment?
Often, programs require customers' banking credentials in order to access transaction data to run programs like rounding, matching or cashback. These can add major friction to the sign up process as people generally hesitate to give out such sensitive information, and doing so puts them at risk. At Olive, we never ask for customers’ banking credentials. We don’t need baking information or credit card PANs.
Make it personal: aligning with customer goals
Customers don’t owe retailers loyalty, but retailers can earn it by giving them a genuinely pleasant experience. To create genuinely pleasant experiences, retailers have to understand what their customers want and what will benefit them. This is called personalization, and it has been a hot topic for many years. When personalization is done well, there is a 6.4x lift in customer satisfaction with the program.
In loyalty programs, personalization has often meant choice. But, at Olive, we think it can mean alignment with customer goals. Is your customer trying to save up for a new TV? Or perhaps they’re trying to increase their credit score. Or maybe they’re paying off student loans.
Aligning rewards with customer values and preferences can significantly increase satisfaction. For example:
- Offering card-linked offers (CLOs) allows customers to choose rewards that align with their personal goals.
- That customer saving up for a TV could be making a roundup contribution with every purchase, and your loyalty program could match the remaining portion needed.
- Or perhaps your loyalty program is helping your customers increase their credit scores by building credit with roundup purchases.
- Your loyalty program could enable cashforward so that roundup purchases are matched 20% and sent directly towards loan repayment.
During times of economic uncertainty, such rewards can provide much-needed relief and foster a deeper emotional connection with your brand. Well-executed personalization can also enhance your marketing and communication strategies.
In summary, the success of a loyalty program hinges on its ability to stand out through clarity, simplicity, security, and personalization. By focusing on these elements, product and marketing managers can create a program that not only retains current customers but also attracts new ones, ensuring long-term success and growth.
Get started today