Customer loyalty is a buzz word often heard in retail and hospitality, and it is something that is increasingly hard to obtain. Shoppers have become increasingly savvy to the number of ‘deals’ available and many are loathe to splash out more of their hard-earned cash when they can wait for a ‘2 for 1’ voucher or ‘20% off’ code. Yet using the word ‘loyalty’ here is entirely false, what retailers need to be doing to stay ahead of competition is to launch campaigns that secure repeat custom, that is, connecting with customers and ensuring they want to come back to you time after time.
The answer to this is to create bespoke loyalty programmes that are personalised and target individuals, based on their interests, preferences and demographics. There are a number of reasons why these particular schemes have been successful. Firstly, they are simple – consumers will bore easily if they can’t get their head around what is required, and how to achieve their reward. They will also be deterred if they have to put in too much effort, purchasing nine coffees to receive one free one makes sense, as this is a transaction many consumers undertake daily. However, being asked to do the same for a more significant purchase, such as an item of clothing or a meal, is unlikely to be met favourably. Finally, the key to success is exploiting the opportunities technology offers in order to fully track and manage the effectiveness of campaigns. There is no point investing significant resource and funds in a campaign if nobody takes it up. By understanding who is taking up which offer and when, for example, who is taking up a 20% off clothes voucher on a weekend and who is drawn to VIP mid-week events, retailers can be better informed. Technology also means retailers can eliminate any risk of fraud – each loyalty card or voucher will have an individual code allocated to it, so there is no possibility of it being shared or duplicated.
Loyalty campaigns have evolved from Green Shield stamps and Air Miles to be an activity we undertake on a daily basis, whether it is through our supermarket member card, our free coffee stamp or when receiving e-newsletters from brands we love. Retailers have a good opportunity to encourage customers to buy more frequently, in higher quantities and spend more by engaging them through loyalty programmes, as long as they are targeted, personalised and fully tracked.
Ben Chesser is founder of Footfall123, a dynamic, fast-growth tech start up set up to allow brands and retailers to develop effective loyalty marketing programmes in order to maximise ROI. Its products equip businesses of all sizes with the tools to create compelling, loyalty campaigns that can be tracked in real time. Footfall123 works with over 3,000 brands including Time Out London, Greene King, L’Oreal, Byron Hamburgers restaurants and the Heart of London Business Alliance. For more information visit www.footfall123.com