It has been researched and established over the last couple of years that it takes five times more to acquire a customer than to retain an existing one. Today in the retail world, it is difficult to acknowledge everything that's happening around the customers. In such a scenario, retailers cannot afford to ignore the need to constantly connect with consumers on multiple channels and touch points simultaneously and also interchangeably. Looking at the current trends, retailers need to overhaul their loyalty programs in order to create a personalized shopping experience.
1) The mobile wallet - As per Forrester Research, mobile payments will amount to $90 billion by 2017! *
The mobile wallet revolution has its primary focus on user experience rather than the backend technology. Even though its effectiveness regarding loyalty looks promising, the actual implications are yet to be fully explored. Delivery of mobile loyalty cards, crediting / debiting loyalty points and update on loyalty status and rewards certificates directly to customers' phones in real time will not only drive up average visits per customer but also augment life of relationship with customer. Preference based specialized offers to customers is a well know concept in loyalty, however factors like time of day, specific date, location, season are yet to be activated via mobile alerts.
2) More personalized in-store experiences for shoppers
In-store personalization in the current world is more about leveraging technology to make apps more personalized and are hence likely to be more helpful inside store depending on customer's current location. As an example, we can have a loyalty app which change when the customer enters a store and launch an in-store locator with a map of the store, indicating the location of the products based on customer preferences and if applicable also provide mobile coupons linked to those products.
3) Omni channel Retailing
Achieving Omni-channel customer loyalty is possible only by engaging with customer thorough pertinent evolving campaigns, promotions, offers and communications across all sales channels across all touch points of the shopping experience that resonate with the customer expectations. Distributing the right information at the right time and in the right context can be fruitful in terms of optimising the relevance and return of all loyalty marketing exercises. Such loyalty programmes promote cross-channel engagement which further buttresses customer engagement.
As consumers get addicted to new technologies and start making purchases across different channels, loyalty campaigns are taking the shape of an ever changing riddle, with marketers facing the challenge of creating an integrated picture from a mass of disparate data points.
Such sound loyalty management practices will ensure that customer-centric marketing initiatives across the purchase cycle - customer acquisition, customer development and customer retention, lead to improved control over customer's progress and in overcoming most of the loyalty challenges through the life cycle stages. Considering the universe of customers at the centre, every customer can be bucketed into one or the other category of loyalty lifecycle as demonstrated in the diagram below:
Given the fact that loyalty management is still in the nascent stage with respect to exploitation of technology and also given that many businesses and loyalty programs, aren't equipped enough to inspire a fresh breed of customer loyalty, there is ample scope for retailers to re-invent their loyalty programs at every stage of the customer lifecycle. Here are a few scenarios of customers in different stages of the lifecycle and how digital loyalty programs can be used with them:
• Would it take really much to delight a prospect with a personalized text on her mobile, offering a free product of her requirement?
• How about flashing the point balance with every text to a responder (prospect responding to a loyalty promotion)?
• How about re-welcoming the former customers with customized offers (based on their preferences / purchase history) delivered directly to their mobile phones?
Better and optimal use of technology will not only grow the number of loyal and new customers but will also build visibility and advocacy for the brand. It will help to further lift product specific sales and promote sales during slow periods, eventually generating returns on the capital invested in loyalty systems and programs.