In the club how loyalty programs create customers for life

Loyalty programs are nothing new. After all, it’s human nature to want to belong to a group, a club, a community – and we love to be rewarded for it. But a club that successfully keeps members coming back is a different story. So how do you keep your members/customers engaged?

Your average loyalty club invites consumers to sign up and join a community, offering exclusive content, rewards and perks, as a thanks for sticking with a brand. And we’ve all bought into them. If you’re anything like me, no doubt your wallet has a one-in one-out policy when it comes to stamped ‘buy 10 coffees and the next one’s on us’ cards. We’ve all accepted them with the intention of going back for more because we want to reap the end reward. It’s the simplest of loyalty program.

But does that make you a loyal customer? Today, a stamp and a “see you next time” isn’t enough.

Why? Because according to The Loyalty Report 2017, North American consumers are part of 14 loyalty program at any one time, but only actively engage with seven. Now that doesn’t sound like an absurd number. But when you consider that most Americans are exposed to between 4,000 and 10,000 advertisements every single day – many of which potentially offer rewards – you can see how rare it is to make it into the circle of seven.

So how does it work in practice? At Tesco Baby Club, for example, we invite mums and dads-to-be, parents, grandparents and carers to sign up to our community and share their bump or baby’s due or birth date. Once they’re part of the club, we send them regular communications with segmented, tailored content based on their little one’s age. From expert advice to relevant rewards, we make sure our members receive everything they need to take on the world of parenting.

Here’s how it works…

The hook is just the beginning

What makes customers take that first plunge and sign up? Whether it was the promise of exclusive member benefits or an introductory offer, incentives are a necessary part of the process. Once the customer has joined, forget the gimmicks, and let the content be the draw. If it’s strong enough, they’ll stick around.

Relevant benefits and rewards

Spend $100 and we’ll give you 5% off your next purchase! *

*If it’s on the third Tuesday of the month… and you’re wearing a red jumper at the time of purchase… and your purchase is one of the 10 completely useless, approved items.

It might seem obvious, but you can easily miss the mark. Rewards need to be relevant, easy to take advantage of and, well, an actual reward. Make it too hard to redeem, irrelevant to your customer’s life, and uninteresting, and no one’s going to stay engaged – you haven’t given them a reason to. There is, after all, a lot of competition chasing after consumer dollars.

Make it personal

Being part of a loyalty program needs to feel like a two-way conversation, not a bombardment of soulless advertising, pestering you to come back and spend your money. When members sign up, they’re giving up some of their personal data, and trust that it be used wisely. You can either ignore that commitment and blanket email all members in the same way, or the data can be analyzed  and used to create a personalized relationship with each and every member.

And this should be applied to everything. From tailored, relevant content-led emails to personalized rewards, carefully curated output will keep members engaged.

If you know your audience, then you can tailor the rewards, too. For a supermarket brand, something as simple as a money-off voucher on their next food shop makes sense, and gives customers an incentive to shop in store. Once they’re through the door, the chance of them picking up more than ‘just the essentials’ skyrockets. And the chance that they try something they like and want to come back and repurchase? You get the picture.

Let them spread the word

Once this bubble of inclusivity has been established, it’s likely that club members will want to share, no whisper it, to their inner circle. A happy customer is all any brand wants, right? When it comes to developing a brand’s reputation, a positive review shared among friends is a marketers’ holy grail. We all want customers to remember the rewards, long after they’ve forgotten the discount they received, because the reward itself has become the brand story. If a member is hooked in by an incentive, they stick around for the unrivaled, relevant content, and then they pass on this information to likeminded people. If they’re spreading the brand story, they must be loyal.

You may have even come across the new breed of loyalty program, where brands reward members with a discount code for recommending a friend – the likes of Uber, Glossier and ClassPass have all used it. These kinds of discount codes benefit the customer and the brand while also growing a loyal community. Genius.

Now go back through those crumpled, stamped loyalty cards and ask yourself, how many brands have gained your loyalty and trust?

Learn more about how Bookmark can help you introduce a loyalty program to your brand strategy and build stronger relations with consumers.

Consumer Insights & CRM Services