How to Increase Loyalty With Social Media and Mobile Amenities
When it comes to brand loyalty, most people immediately think about rewards programs that incentivize consumers by offering points that can be exchanged for products and services. The idea is that you provide a strong enough incentive to pass up a momentarily better option from a competitor. Over time it creates a positive behavior that results in increased lifetime value. As Seth Godin, entrepreneur and permission-marketing champion has pointed out, "Loyal customers always know there's something better out there but they're not interested in looking."
Over the last three years I've meet with numerous loyalty marketing professionals and vendors selling the latest and greatest loyalty platforms. They all focus on solving a very specific problem: How do you increase participation, engagement and redemption to create the behavior that leads to a loyal customer? When you analyze your customer base, you likely ask the following:
- What's each customer's worth or potential value?
- Do they participate in your loyalty program? If yes, how often do they participate?
Not All Customers Are the Same
Let's take, for example, a small group of high-value customers with a high participation rate. If you're an airline or hotel firm, you may have a group with a large number of business consultants or traveling salespeople looking to subsidize their family vacations using loyalty points. You may find that another group has high value, may or may not be registered in your program, but have zero participation. You'll also have other variations in between. In almost every conversation, the questions are consistent:
- How do we make our loyalty program work for everyone so that we can increase participation and redemption?
- Should we make our points transferable?
- Do we need more ways to redeem points, perhaps expanding partnerships?
- How about a mobile app to make it easier to track points?
- What's the right web application where consumers can find the products they want as well as get email updates showing current point levels with the number of points needed a product?
When looking at how customers break down, the picture looks familiar and the answer may be different than you expect. For example, loyalty professionals can learn a lot from spaghetti sauce — Prego to be specific. A few years back, Malcolm Gladwell highlighted research from a horizontal thinker by the name of Howard Moskowitz. In the 80s, Prego hired Moskowitz to help them create a "perfect" spaghetti sauce that would please the most people.