Trends and fads are common in the quickly-evolving local marketing industry, but it appears that loyalty programs are here to stay. Nearly half of marketers say they plan to increase spending on loyalty programs in 2017, with 13% looking to boost spending “significantly” in the category.
With more merchants expected to adopt or expand their loyalty programs in the coming year, it’s becoming quite the challenge to capture the attention of consumers who often feel like they’re being pulled in every direction.
“In today’s consumer environment, customer loyalty seems illusive and can be difficult to earn. Increases in social platforms and changes in technology in 2017 will only continue to add clutter and distraction in the lives of consumers,” says Brian Mattingly, CEO of Welcomemat Services, which provides local businesses with locally-targeted marketing solutions.
So what’s the secret to keeping customers loyal in 2017? To find out, we went directly to the experts and asked what trends they’re seeing within the local merchant community.
1. Use data to deepen relationships. “When merchants have accurate customer data, they’re able to use it to deepen relationships and drive increased frequency and spend. A great example is Good Food Guys, the restaurant group behind California-based Split and Mixt. They use spend data to analyze their customer-base and uncover VIPs. This past holiday season, the brand surprised their VIPs with an on-brand gift for the holidays. The gift was a personalized Swell bottle that can be filled, for free, every time VIPs come into the stores, with iced tea or lemonade. The gift makes them feel special and keeps them coming back. It has the additional benefit of allowing employees to easily recognize VIPs so they can give them an extra warm welcome.” (Zach Goldstein, Thanx)
2. Make connections during life-changing events. “Loyalty begins with finding the right consumer, creating a relationship with them and then working through channels to consistently communicate with them. Marketers have found that consumers who are going through significant life changes, such as a move, are generally much more open to changing loyalties. This can be a good starting point for businesses when it comes to finding the right consumer with a high propensity of becoming loyal.” (Brian Mattingly, Welcomemat Services)
3. Keep a sharp focus on the customer experience. “Now more than ever, consumers are migrating to retailers and businesses which deliver the best overall customer experience. That includes everything from exemplary customer care to an exceptional shopping environment and special perks for best customers. I sense the onset of ‘loyalty fatigue’ with some consumers, which means loyalty programs may not be enough to move the needle with your customers. In fact, traditional reward programs may be losing some of their appeal. So instead, savvy businesses with an eye on future growth are re-focusing their efforts on ensuring they deliver an extraordinary and memorable customer experience every time someone walks through their doors—one which exceeds what’s offered by competitors.” (Walter Dubowec, Firefly Rewards)
4. Consider getting out of custom apps. “I expect to see restaurant merchants move away from custom apps as they take notice of the low star consumer ratings that the vast majority of these apps receive. Not every brand can pull off a custom app—it takes deep pockets to do it right and a rabid customer-base to adopt it and actively use it. With loyalty at the heart of most custom apps, the experience must be effortless and provide continued value or customers will abandon the app, making the loyalty program ineffective as loyal customers are no longer being tracked.” (Zach Goldstein, Thanx)
5. Choose the right communication vehicles. “Once an introduction is made to the right consumer, the ongoing communication platforms continue to evolve. Email and direct mail tied in with technology continue to prove themselves as strong communication and response vehicles for loyalty. Social platforms are also used to build loyalty by allowing businesses to keep in regular contact and strengthen loyal relationships. Choosing the right social channels is dependent on the business vertical and consumer type but certainly must be part of the loyalty mix. Loyalty programs are now more intuitive than ever, [evolving] from old paper punchcards to sophisticated apps allowing for push notifications and social sharing amongst a business’s loyal customer base.” (Brian Mattingly, Welcomemat Services)
Stephanie Miles is a senior editor at Street Fight.