In 2017, the process of fine-tuning customer loyalty programs will be a prime objective for many brands, especially since an effective loyalty program can be a key market differentiator.
Several senior management officials at Comarch offered Loyalty360 their insights on this subject, as well as for related topics such as technology, social media, mobile applications, and personalization.
Comarch officials underline the distinction between concepts and practice, stating that “there is a difference between ideas and implementation needs for 2017,” cautioning that ideas will be implemented only by early adopters whereas the majority of companies is still severely lagging behind when it comes to innovative aspects of their loyalty programs.
The real challenges this year will be much more elementary and will include connecting loyalty data with social data through recommendation engines (i.e. best reward, best offer recommendation etc.) as well as rewarding members for non-transactional activities.
Technology
In terms of technology, the biggest trend for the next few years will be the growing presence of BOTS (e.g. Amazon Alexa - intelligent personal assistant) and Chatbots (e.g. https://hipstercatbot.com/ or https://youtu.be/PGLASey3MAE) which are valuable tools in maintaining the communication with the customers. Another fascinating concept that was introduced in 2017 is called Amazon GO and it is a giant milestone in regards to customer experience. This revolutionary store enables customers to shop with no lines and no checkout, thanks to Amazon’s Just Walk Out technology, which automatically detects when products are taken from or returned to the shelves and keeps tracking them in a virtual cart. Before this invention will become more widespread we will more likely see an increased usage of tablets in stores for sales teams and customer service staff. What’s more, the branches of wearables and IoT will continue to develop since direct connection will still play an important role in enhancing the customer experience.
Social Media
The strategy of using an omnichannel approach for social media as a way to not only facilitate loyalty-related marketing communication but also to enhance customer service-related issues (e.g. dealing with complaints through direct Twitter messages) will remain a recommended direction.
Comarch’s experts stressed the importance of social media analytics in the modern business, saying it is a “must” rather than a “nice to have.” Since 70 percent of companies still are not gathering data from their social media channels, in 2017, brands should focus on introducing this approach and take this opportunity to discover a wealth of data about consumer trends, purchase intents, product attributes, drivers of sentiment, competitors or category-level conversations.
They should, however, keep in mind that it is not only about counting likes, follows, and favorites, but more about gaining actual information from the content of posts and tweets to form useful conclusions that can serve as a base for building an accurate customer strategy.
Personalization
Comarch’s loyalty professionals claim that a personalized approach will continue to be a dominating tendency as a lot of airlines are allowing their travelers to customize their experiences, analogically to the way that some retailers do (i.e. automotive industry). In terms of loyalty programs, it is particularly reflected in an increasing demand for giving members the option to select preferred bonuses in a form of benefits chosen from a larger pool. Since the majority of traditional airline loyalty programs have a fixed set of benefits after scoring a certain tier, providing the passengers with this unique opportunity when they reach a specific a level becomes a profitable marketing step to attract their attention.
Mobile apps
The mobile application area is still an extremely important component of business expansion, especially when it comes to mobile payments, which should be seamlessly integrated with the mobile apps dedicated for loyalty members. While designing a loyalty or marketing campaign program, instant messaging apps such as WhatsApp, Instagram, SnapChat, Viber, Telegram, Facebook Messenger etc. should be taken into consideration, as they are becoming progressively important to maintain constant, relevant, and personal dialogue with the customers.
Their integration, as well as the development of use cases and methods to implement them in the best possible way within the loyalty concept to gather data from these channels, will be vital in 2017. It will be especially crucial in case of targeting to the younger generation groups (16-30-year-olds), which can be proven by the outstanding success of WeChat application in China. It is a perfect example of how messengers are becoming more and more of a daily ‘cockpit’ for users due to integrated payment, daily, and m-commerce functions.
How customer loyalty will be defined in 2017
A prevailing tendency that can be observed is that the customers expect instant rewards and digital redemption options (i.e. Uber Credit, Spotify, etc.) Therefore, we should keep in mind that some industries will introduce standard point-based loyalty programs and will concentrate on smart real-time couponing and deals (Retail) and automated rewarding (“We give you a reward when we think you have earned it” instead of you are redeeming your points) and others will be building mobile programs focused on the brand’s core proposition (e.g. Walmart’s latest program).
Another popular direction in retail is the implementation of multi-program or multi-country solutions. Apart from allowing for the companies to incentivize their members through rewards and optimize the communication based on their behavior and history, they also provide the ability to easily share the best practices and unify the benchmarks across all countries and branches of the company. Additionally, this tactic allows for the management to get a better control of the budget as well as results of campaigns.
Lastly, Comarch’s loyalty specialists mention the value of employee programs and the fact that, if they are wisely designed, their power can equal or surpass the marketing abilities of generic consumer-oriented ones. These two concepts are connected with each other since, with the active motivation of the employees, companies receive a promotion of a loyalty program for the final customers, expansion of the customer base, and better customer service reputation.