The Difference Between Getting, and Keeping The Customer
With so much focus on data as an acquisition tool (registration forms being the prime proactive data entry moment) it is easy to forget that delivering a value exchange for data on an ongoing basis, is vital for customer loyalty.
Anecdotally, internet message boards are littered with comments along the lines of ‘terrible experience on the phone to such and such broadband provider’ or worse, the litany of confused billing from utility companies, some resulting in bills more appropriate to a medium-sized supermarket than a two-bed semi.
These are just examples of what happens when a lack of joined-up enterprise data creates poor customer experience, destroying value. It is incumbent on companies not just to prevent this from happening but to put in place measures that will delight the customer and build up goodwill.
For many companies, this continues to be in the form of a customer loyalty scheme, although the most successful, go far beyond pure collection points:
“Online is a relatively small part of our business compared to other retailers. We don’t see it as a separate shop however, it’s a technology that supports the whole multichannel business. We are at the very beginning of a mobile strategy – we are digitising our loyalty scheme, we have Apple Pay, but I’m not in a hurry to tie loyalty points and mobile wallets together” Edward Armitage, Ecommerce Director, Waterstones
Clearly tying up a variety of loyalty and incentivisation projects, both current and legacy, is a challenge for retailers and there is a growing belief that loyalty points are relatively old-school and wider customer experience programmes are more appropriate, giving the loyal customer a good experience in terms of consistent and valued offers, but also without them having to work too hard at it.
Unfortunately, in some cases, retailers’ strategies stretched only as far as creating a cardboard loyalty card; great if you just want people to keep coming back for coffee (it works), but not so great if it’s about longer term relationships and value. As a mechanic to acquire data and tie it together across channels, this is inadequate.
Guidelines For A Successful Customer Loyalty Scheme
For successful customer loyalty schemes:
- Retailers will need to explore whether or not it’s viable to replace such incentive schemes with plastic or indeed mobile app-based customer loyalty programmes.
- Retailers should consider if there are any customer data acquisition mechanics already present within the business that could be put to better use.
- Retailers must prioritise customer expectation management. As more marketing activity moves onto mobile, and interaction between apps, loyalty and payment mechanics become commonplace, not all transition will be seamless. As a result, retailers must consider ways to demonstrate value so customer goodwill is retained long-term.
The mechanic with which to engage customers and encourage loyalty need not be complex. For example in September 2015, Mothercare introduced electronic receipts which allowed customers to keep track of a purchase made in store without having to make sure they don’t lose a slip of paper.
Considering the core customer base of the store is mothers with young children, this is a simple time saver that can make a big difference. Crucially for Mothercare, it helps the company join up the online and offline environments as well as securing detailed customer information for future use.
Essentially, retailers who best understand the needs and challenges of their customer base and build customer loyalty solutions that integrate with those customers particular buying behaviours, are the ones best placed to adapt to ongoing multi-channel change and retain customer loyalty.