For brands that launch loyalty programs, it’s always very interesting for them to see the early results, receive and leverage customer feedback, make modifications, and to gauge future success.
Brands that plan to launch a loyalty program for the first time are always keenly interested in any advice regarding implementation and tracking to ensure success.
Customer Communications Group (CCG), a full-service loyalty and marketing agency, wants to help brands stay on track to during the first two years of their loyalty marketing programs.
“First, we help clients figure out where they stand, which is why we created the Loyalty Self-Assessment, said Sandra Gudat, president & CEO of Customer Communications Group. “Next, we determine the steps that will push them up the loyalty marketing continuum.”
CCG offers the following five steps to help brands jumpstart their loyalty programs during the first two years:
1. Big Changes Coming
Marketers should expect to see big changes over the next 24 months as more members join and a greater percentage of transactions are represented by loyalty members. There may still be some kinks in operationalizing your program and that’s par for the course.
2. What Percentage Loyalty?
If loyalty transactions are 25% of total store transactions, that's a decent start, especially by the end of the first year of the program. However, by the time the program is two years old, member transactions should account for closer to 40% of all transactions. If they are not, marketers may need to reevaluate the program value proposition and benefits to ensure they are relevant and enticing to customers.
3. Know the VIPs
Many retailers report that the top 25% of their customers represent nearly 70% of total sales — that’s a lot of revenue tied to a comparatively small group of customers. It’s a smart move to have a strategy in place to recognize them.
4. Talk it Up
Consider what additional customer-facing communications — such as FSIs, promotional emails and social media — can incorporate at least a simple description of the program. Reinforce to customers the rewards ($, members-only sales events, etc.) if they spend a certain level. Whenever feasible, include customers' account status to show how close they are to their next reward.
5. Be Flexible
Suppose 0% – 10% of members earn the program’s primary reward within a 12-month period. If the program is brand new, this might not be a concern. But if the program is closer to two years old, members may consider it too restrictive and, as a result, many may have disengaged out of frustration. Change it up.