Customer loyalty programs operate on a general principle: customers enjoy earning benefits for shopping, and merchants gather data to improve customer loyalty. In the latest Carat Insights findings we analyzed over $3 trillion in payments data, combined with a consumer survey of 2,200 Americans to understand how and why payment methods have changed, from the start of the pandemic in Q1 2020 to today in Q3 2021.
This article provides detailed insights that merchants can leverage to understand the current state of customer behavior and how to design more effective loyalty programs.
Loyalty programs provide a mechanism for brands to build customer loyalty. Our data reveals key insights into the landscape today:
So, how do you go about implementing an effective customer loyalty program? With three simple principles - focus on the customer, make it social, and encourage repeat business.
Your business can reach more customers and increase engagement with a program that tailors specific benefits based on your customer’s demographic and focuses on their perception of value.
Instead of taking a one-size fits all approach, merchants should tailor their loyalty program to specific customer segments.
Additionally, customers need to easily understand and clearly quantify the value they receive each time they shop, dine, and travel.
Businesses can encourage customers to connect with others and boost marketing efforts by leveraging the power of social networks – both online and in-person. By offering more opportunities for consumers to elevate their personal brand, businesses are encouraging social sharing by their most loyal customers.
Customer status is a key component of loyalty, and giving customers the opportunity to tout their “platinum rewards” or achieving a new tier provides an opportunity to amplify your brand.
Businesses can encourage repeat customers by consolidating earned loyalty across your brands/services and prompting customers to move through and repeat the “earn-spend-promote” cycle. Case-in-point, by consolidating loyalty programs, you are:
Lastly, a fundamental component of a strong loyalty program is consistent engagement from your customers. Businesses should look for their loyalty program to be integrated across all aspects of their customer engagement platform, promoted in-store and digitally, and used by their customers during all purchasing interactions.
Visit carat.fiserv.com learn more about Carat’s Customer Engagement solutions.
Source: Carat Insights Report and Fiserv data