The need for personalised Rewards Program
Updated: Oct 29, 2019
The new-age customer treats the points as personally earned and expects to use them as ubiquitous as cash.
In a world where 56% of customers stay loyal to brands that get them and 65 % of a company’s business comes from existing customers, the need for customer loyalty is more important now than ever. As Steve Jobs said, “Get closer than ever to your customers. So close that you tell them what they need well before they realize it themselves.”
Reward programs should aspire to initially look beyond points and rupees, and begin by creating a memorable, emotional connection to the user. This personalized, customized approach would only be beneficial in the long run as it would develop a lasting relationship with dealers, resellers and retail partners. Today, targeting new customers is 25% more expensive than retaining new ones. Customer loyalty is beneficial for Businesses, business partners and consumer gratification.
The way brands are incentivizing customers is also changing. By encouraging customers to fill out their profiles as a part of their loyalty program, brands can increase their bond with them and see what they want in the future. Through this brands can create targeted marketing campaigns. Reward Programs have always given incentives to customers through their purchases. Delta Airlines in the US have partnered with Lyft and Starwood to make getting to the airport and lodging simple and rewarding for every journey to the airport. Today, customers use social media more than ever to seek what they want next.
Due to the extended access consumers have to networks, social media accounts and review platforms, loyalty programs should strive to reward consumers for activities such as referring friends, sharing posts, and creating content. This form of customer advocacy only helps brands perceive what consumers desire in the present and the future. An example of a referral program which goes beyond monetary rewards is DropBox which offered an extra 500 mb of storage to the customer who makes the referral in 2010. The membership increased by 60% as a result of this.
The new-age customer treats the points as personally earned and expects to use them as ubiquitous as cash. This dictates the needs of the existing loyalty programs- wherein the customer gets freedom, flexibility to use the points anywhere, anytime. An apt example for this is Santander Bank which used it's Super Wallet Pay to allow customers to pay with rewards points for Amazon, Spotify, Uber, etc. In such a framework, there is no doubt that a customer would come back for more.
The future loyalty programs should be structured around a customers needs- they cannot be bound. We need loyalty programs to move from closed loop to open loop structures. Ultimately, so no matter how magnificent or how cool your Loyalty Program looks, its fate is always decided by the customers. It comes as no surprise that global market for loyalty is expected to reach 201 billion dollars by 2020.
https://www.smallbizgenius.net/by-the-numbers/customer-loyalty-statistics/ https://www.annexcloud.com/blog/10-benefits-implementing-customer-loyalty-program/ https://smartercx.com/3-customer-loyalty-trends-for-2019/ https://influitive.com/blog/9-stellar-referral-program-examples/