Is your loyalty programme winning hearts?
Loyalty programmes are created to help retailers drive customer engagement and retention, and are gaining traction in Asia, with three in four Singaporean consumers indicating they will buy more from retailers if they are better rewarded for they loyalty. However, only three per cent of consumers in Singapore express a willingness and desire to forge enduring relationships with their preferred brands. Most customers regard loyalty programmes as a one-dimensional experience, where they are just spending money to get points, without realising and maximising the real benefits of the loyalty programme.
There are numerous warning signs for retailers and marketers that suggest your loyalty programmes may not be as effective. If you are responding to the following questions in the negative, it may be time for you to relook at and refresh your loyalty and rewards programme.
1) Are your customers resonating with your loyalty programme?
If your customers are not feeling committed and devoted to the brand, they will easily switch to one of the many other choices easily accessible and available in the market, and this is a sign of the loyalty programme failing. For a loyalty programme to distinguish itself and stand out from the crowd, it needs to communicate and recognise the customer from a human perspective while appealing to the customer’s heart.
Cathay Pacific, for instance, connects with its loyal passengers through its recently launched “Artmap project” for over one million members of the airline’s loyalty programme, the Marco Polo Club. Under this project, Marco Polo Club members will receive a customized digital work of contemporary Chinese art via email on their birthday, depicting their journey with the airline the past year. Through the Artmap, the airline seeks to create real emotional value for members, by celebrating their past journeys and inspiring journeys to come.
2) Are you using data to cater to your customers’ individual needs?
Valued customers expect to see rewards as well as the programme working beyond a transactional level from day one. A loyalty strategy should move beyond the notion of just rewarding purchases, and extend to rewarding customers for being longstanding and therefore valued.
67 per cent of Singaporean consumers will buy more if retailers use their data in carefully considered, contextual ways to better understand their individual needs and preferences. This suggests data should be collected to make intelligent decisions on what the customers would like, and shouldn’t just be tabulated. The data should be used to go beyond relevant product recommendations to include the personalised perks that customers would like, such as same-day self-collection or delivery for online purchases, and incentivised birthday month promotions.
3) Are your customers – and your own staff – aware of your loyalty programme?
In the retail and service industry, your staff lay the foundation in driving customer loyalty and devotion, and this points to a need for complete buy-in at all levels. This boils down to service levels, which have not progressed much in Singapore in recent years, largely due to the tight labour market in Singapore and high turnover rates which ultimately affect service continuity . So resolving this issue through a cohesive employee engagement culture is important in ensuring the success of your loyalty programme.
In addition to relying on recommendations from staff, a loyalty programme should also occupy its own position of pride and project credibility, amongst both existing customers as well as those whom you are trying to reach. 61 per cent of consumers place an emphasis on the importance of better communication, indicating they will buy more if brands communicate with them better, in ways that express reciprocity and shared passion. Many retailers do a great job promoting their brand and advertising their next season’s collection – why not adopt the same approach to promote your loyalty program and further drive revenue for the brand?
4) Is your programme keeping up with the changing times?
In order to take a relationship with brands and retailers to a next level, Singaporeans want more than just a traditional points-based reward programme. Your loyalty strategy needs to surprise and delight your customers in order to keep them coming back, and ultimately to drive deep devotion to your brand. Just like in a relationship with a loved one, providing something a little bit special and unexpected that surprises and delights them will let your customers know that they’re valued and thought of, and not just being asked to accumulate points for the sake of driving revenue for the brand.
This is why companies like Intercontinental Hotels Group (IHG), which has the largest hotel loyalty program in the industry, pay close attention to trends and changes in consumer trends. In the recent World Economic Forum in Davos, the group identified best practices to better meet customers’ increasingly complex needs in its 2017 Trends Report. Such commitment to keep evolving and adapting is at the heart of a successful loyalty programme.
5) Is your loyalty programme easily understood by your customers?
Getting people on-board your loyalty programme may be half the battle won, but to keep them engaged, the programme should be simple to use and free of any steps that would create hassle for your customers. People value simplicity over excessive features, multiple steps and time spent to even get registered.
Many loyalty programmes end up leaving customers uncertain of what they have to do to earn points, how they are rewarded for loyalty, and how they can progress to the next tier – these should be explicitly expressed to customers to ensure they are well aware of how the programme works and thus, willing to stay devoted to the brand. In addition, in the case of online and in store programmes, brands should ensure that the same rewards and perks apply both online and in store, and the quality of service and personalisation offered should be reflected in both avenues.
Identifying the gaps in consumers’ retail experience and recognising what they are looking for in the retail experience and loyalty programmes is the first step in addressing the lack of devotion that Singaporean customers have towards loyalty programmes. It is precisely in such uncertain times amidst Singapore’s retail doldrums that retailers and marketers should overhaul their loyalty programmes to stand out, deepen engagement meaningfully, and win over customers’ hearts.