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The Balance Between Acquisition and Retention

Growing and maintaining a successful loyalty program requires a strategic acquisition and retention framework that brings in quality members and keeps them actively engaged over time.

Many loyalty marketers focus their valuable time and money on acquisition. Get new members. Drive signups. Push the program. And building a member base is undoubtedly important. But what happens when successful acquisition efforts are negated by member drop-off? Acquisition efforts can and often are cancelled out when existing members stop participating. So, once we get these people to sign up, how do we make sure they stay actively engaged forever? Or at least long enough to see them as high-value participants?

The real battle is for placement. According to several recent reports*, there are only about six programs a consumer will actively use at any given time. Therefore, it’s most important to understand the “why” behind which programs they choose to engage with, and apply those learnings to your loyalty program. Earning placement among the top six is achieved by having an active engagement strategy.

Below are a few of the reasons we know as to why consumers stay engaged:

Rewards Rule: According to Colloquy’s 2017 Loyalty Census, 93% of people rate the types of rewards offered as either “very important” or “somewhat important” when deciding to engage in a program. It’s critical to ensure rewards are tailored to your audience and tie in with your brand.

Love for the Brand: The top motivator for loyalty program engagement is “I love the brand, company, retailer or service.” One way to drive brand affinity is to connect over a common cause or lifestyle elements.

Make Life Better: True engagement can’t be created based on discounts. Focus on utility, solving problems, or easing a consumer pain point to drive long-term use, and always look for ways to incorporate these into the program over time.

Celebrate Loyalty: Personalized offers, communications, and special thank yous show members that their loyalty is reciprocal. Make point redemptions an extra special event instead of just another stop along the customer journey, or send top members a surprise thank you when they aren’t expecting it.

How to get there? Start with member sentiment.
Let’s start at the end. One of the goals for any successful program is getting consumers to think and feel a certain way about your brand. Sentiments such as:

  • “This program rewards me in worthwhile ways just for buying what I need”
  • “This program recognizes my loyalty, appreciates my business, and cares about my needs”
  • “This program makes life easier, more fun, and more affordable”  
We can tie each sentiment back to redemption, celebration, or convenience. Redemption is about getting extra value in exchange for behaviors a consumer is already doing. Celebration is about feeling special and knowing that the brand recognizes and appreciates consumer loyalty. And convenience can refer to the personalization and features within a program that show members you understand them and want to make their lives better.

Define for your brand what you want consumers to think and how they should feel rewarded and valued. Consider what’s most valuable to your audience as well as the elements that will keep your program relevant. Go through this exercise often, and continue to optimize over time. That’s what’s critical to long-term success.
It’s easy to get caught up in acquiring new members, but without a long-term retention strategy to keep members engaged, it may be a losing battle.
 
*Bond Brand Loyalty, The Loyalty Report 2017, among others
 
Gina Fleck is a director of loyalty at HelloWorld.

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