With so many competitors in the market, companies have to find ways and means to get their lion’s share of the market in order to survive in the dog-eat-dog-world of retail. In particular, smaller companies have to double up their marketing efforts, especially against the more established brands. Those who fail to retain their customers will ultimately fail, leading to the demise of their business. With client loyalty so much more difficult to maintain these days, it is crucial for retailers to give options like loyalty programs and customer rewards platforms. In this very competitive global arena, customer loyalty and satisfaction are both the name of the game. Businesses must strive to be different and provide a more complete customer experience. Thus, more and more companies, including smaller start-ups, are venturing out of the box to creatively keep their clients’ attention. Here are the top ten loyalty program trends that everyone can expect to see this 2020 as companies continue to vie for the attention of the modern customer.
Top Ten Customer Loyalty Program Trends
There are various ways that companies try to keep their clients elusive attention. Here under are methods we can expect to see this 2020. Some of them are patterned after tried and tested models. However, some are also new to the game thanks to advancements in technology.
Developing Strategic Loyalty Program Partnerships
It has been done in the past and it will still continue to happen this 2020. Brands have always formed strategic partnerships with other equally popular brands in order to serve their customers better. Brands forming strategic partnerships to better serve similar customers is nothing new. To illustrate, the Hilton Honors and Lyft partnership, which is touted to be the first ever of its kind in the hospitality, travel, and transport industries. Now, then members link their active Hilton Honors loyalty membership with their current Lyft accounts, they will ear perks. They stand to gain corresponding Hilton Honors Points for every dollar spent on Lyft rides within North America. The executives of both companies shared that it is important for them that their members get to where they need to go and find a perfect place to rest once they get there.
Introducing a Mobile App
Businesses that introduce an app can keep a pulse on their clients through advanced analytics provided with the use of the app. It is much easier to track in-app activity and to see which kinds of content that draw the most user interest. By using an app, companies can refine their sales and marketing efforts with the demographic info provided upon registration. Most of all, companies can rely on geofenced push notifications, newsletters, promos, and loyalty programs within the app to keep their customer base engaged and thriving. Thus, it is critical for companies to adapt and evolve with these new trends. Urban legend is, Richard Branson, the billionaire who owns Virgin Atlantic, lost to the start-up Uber when he attempted to go toe-to-toe with them because Uber is backed up by algorithm. And that is quality data! Because of this, Uber was able to morph from a start-up to a transportation giant because they were able to monitor, track, and give their clients needs through the mobile app. Data indicates that clients are raring to download and use mobile apps from their favorite small businesses. Companies must not ignore the data in front of them.
Providing Loyalty Programs that Give Back
It is not the first time that a company’s corporate social responsibility will be tied to a loyalty program. It has been done briefly in the past, but the market will see an influx of this for the coming 2020. The trend will definitely grow as more companies appeal to the emotional side of their clients by showing that they, too, care about causes and various advocacies. A good example is DSW VIP members can choose to donate their shoes and existing rewards points to those in need through their Soles4Souls and Be Strong programs. As of May 2018, more than 1.4 million shoes have been given away to these noble causes. Many clients continue to remain loyal to the brands they believe share the same values that they do. They shall continue to patronize these brands because they feel as if they’re making a difference when they do.
Offer Premium Loyalty Programs with Better Perks
Majority of consumers, specifically 80% millennials and 68% non-millennials, said they would be more than willing to enter a premium loyalty program of their favorite companies if they were offered and if the benefits and perks are valuable to them. Typical traditional free loyalty offers will always have their place and value amidst the ordinary consumers. However, launching premium programs with added perks are just too darn valuable that the more discerning and loyal customers are actually willing to pay to get them. It must be noted that 87% of consumers who are satisfied with these special perks, offers, and benefits given by a paid loyalty program of their favorite retailers will likely still choose that retailer over a competitor that is offering a lower price. These people are also likely to recommend the brand more to their families and friends.
Adding Gamification to the Loyalty Strategy
It has been reported that more than 80% of millennials and nearly 75% baby boomers prefer to get rewards not just for purchases but because of their engagement with their favorite brands. As such, companies should include gamification marketing to improve their customer engagement, which is another key to brand loyalty. To illustrate, Nike clients in China had the privilege of trying on select Nike shoes in a few stores in key cities. Through virtual reality, they can participate in a fun game called Reactland. They can document this experience on their social media and receive corresponding rewards and discount offers. This 2020, brands will understand that the best and most effective loyalty programs will be able to include gamification. The latter’s focus is not just transactions but engaging customers. With their help, these snippets can even expand reach as they go viral on social media.
Giving Loyal Clients a Choice in Directing Company Policies
Loyal clients want to feel like they are active stakeholder in the company. It makes them feel good and valued to be a part of forming policies and making company decisions. As such, 2020 will see an increase in companies valuing the feedback of their most loyal customers. A perfect example of this is Target’s announcement of the nationwide rollout of its Circle program. One of the transaction perks is Target Circle members will also be given the privilege to cast their votes to help direct Target’s giving. Right now, the company serves approximately 800 nonprofit organizations in their local communities and loyal clients will have at where these benefits will go.
Provide a Better Experience
Clients love it when they have the premier advantage of perks because of their loyalty to the company. Other services that these loyalty programs may include will be access to exclusive lounger memberships, skipping lines, personalization, premium wrapping services, and deeper discounts for their loyal clientele.
In this modern day and age, clients are used to instant stuff from instant noodles, microwave popcorn, and quick messaging. With customer loyalty programs, they also what the same no excuses for their rewards. They want what they want right this minute. They want instant accrual of rewards points that must be redeemable the moment they qualify for it. Clients will continue to see points instantly updated, and they will have steady access to chatbots that will give them a quick reply to their queries. They will also continue to see instant coupons that are given for each completed transaction.
Boosted Touch Point and Omnichannel Strategies
Brands will continue to employ touchpoints and omnichannel strategies to keep their clients attention. For instance, a client may be searching for a jacket in Facebook, Instagram, and Amazon. When this client logs on to the rewards program, this very same jacket or a version of it will be suggested by the program. These intelligent technologies create and provide a seamless consumer experience on many platforms, which the client frequents on his or her mobile device. With many competitors, it is critical for businesses to always see their message and feel their presence.
Continuation of Tiered Programs
Those that buy more and have spent more time with the company deserve more. Thus, some brands have standard, silver, gold, and platinum rewards tiered programs that offer different levels of service. Those that want to get more perks can choose to spend more to attain this level.
Top 10 Statistics Regarding Customer Loyalty in 2020
- Loyalty is more difficult to maintain for a retailer now than ever with nearly 70% of consumers admitting that they are always exploring other brands to get the best deals.
- It was reported that 44% of companies focus more of their efforts on acquisitions as opposed to only 18% that focus on retention. The things is existing customers have been recorded as being likely to try new items and spend more when compared with the buying patterns of new customers.
- Currently, 80% of a company’s future revenue will come from just 20% of existing clients.
- A traditional American business will lose 15% of their customer base each year.
- A reported 27% of small enterprise estimated that 11-20 % of their first time clients do not come back or make a return purchase in their business.
- Majority of customers with an astounding 82% said they stopped dealing with businesses that have poor customer service.
- It costs 5% more to acquire a new customer than to keep an existing one satisfied and happy.
- An ordinary repeat client will spend more the longer they are with the business. They have been noted to spend 67% more in months 31-36 with the company as opposed to months 0 to 6.
- By increasing ten percent of their customer retention levels, companies stand to increase 30% of their company value.
- Loyal repetitive customers spend at least 33% more than new clients.
It is critical for businesses, no matter the size, to always be updated when it comes to their loyalty and rewards programs to ensure that their clients will remain loyal to them. With so many competitors offering a world of value, those who do not offer this will eventually fade away. Stay ahead of the game offer those esteemed clients privileges, promos, and perks to keep their attention.