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Changing Your Loyalty Program? Don't Miss These Three Steps

If you are thinking of evaluating or starting a loyalty program, it's a great time to take stock of customers, what they like and how they engage with your brand. Here are three steps you don't want to miss.

Lilly Huxhold
February 11, 2021 4 minute read

2020 was a rollercoaster of a year, but if it taught us anything, it's that industry standards will only continue to accelerate to meet customer expectations. If you are thinking of evaluating or starting a loyalty program, it's a great time to take stock of customers, what they like and how they engage with your brand. 

Loyalty programs are a great tool in a brand's arsenal to gather customer data and shift to a more personalized relationship with them. Have a behavior you want to pivot? In search of your ideal customer? The gold standard of loyalty programs can accomplish that. 

It's essential not to forget that customer expectations are defined by experiences, not by vertical nor industry. For example, Amazon's time to shipping changed how fast consumers expect a delivery. While the competition always seems to have a shinier rabbit hole — piloting tech and new products — following trends to match your competition does not always mean winning over your customers' hearts and expectations.

How do you build an ecosystem that transforms new customers into brand loyalists and continues to delight and engage existing fans? Here are the first three steps every brand should take to get there.

1. Find your number one fans and the ones that got away.

Look for your frequent, big-ticket customers who aren't afraid to tell you what they like and what they don't like about your brand, and who come back to your brand at a consistent frequency. Their behaviors can provide golden insight into what drives your customers towards change, what they respond well to and what they did not. The more a brand knows the ideal customer, the better they can position themselves to ask the questions: why are they my ideal customer, and how can I turn current and new prospective consumers into brand loyalists?

We all know change is only going to accelerate, and knowing who are your “ride or die” customers will help you gauge just how much time you need to spend in the fast lane.

2. Measure twice, cut once with The Why.

Loyalty is more than just getting foot traffic or day over day revenue increases; it's a data mine for everything ideal for customers of your brand. But that data mine needs a focus, and that's where 'The Why' comes in. Is this to pivot a behavior such as increasing app downloads or frequency of purchase? Do you wish you had more information on your customers to start personalizing experiences?

Knowing 'The Why' means more than just building a successful loyalty program. It significantly impacts customer engagement and how they interact with your brand. Keep in mind, your Why will adapt and evolve over time, alongside your digital transformation roadmap. This isn’t a static decision, it is an adaptable one.

3. Don't get shiny object syndrome, because  it's a marathon, not a sprint. 

Now that you know your fans and have The Why, take a deep breath on that excited energy. It's easy to get lost in all the new features, technology and results that loyalty programs can utilize or unlock. Still, customers — no matter how fast the industry is accelerating — are wary of change. Transparency into how your new program works, what is staying and what is going is important to keep customers comfortable and excited. For example, customers prefer rewards they control how and when to use, versus being handed a free bag of chips they may never eat — taking away their ability to choose may turn them off to the program.

Your ‘Why’ is your North Star, and if it's a low-fi option that solves for it, start there. Start with what makes both customers and the brand happy. Play with what pivots behavior, and if something sticks, begin to add on only when it shows a return in investment in time, revenue, engagement, etc.

iteration cycle

When building or evolving a loyalty program, trust that it will take time, transparency, and strategic incentivization to answer 'The Why.' A loyalty program that thrives on iteration, focuses on function and evolves with customers is ready for rapid industry shifts — without throwing the baby out with the bathwater.

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