Customer Loyalty: Asking Why

According to Google, asking “why” dominated the internet search in 2020. Just like people were wondering why they needed to wear a mask or why their flights had been cancelled, you must also ask “why” when it comes to your loyalty program. When designing a loyalty program, offering rewards or setting rules, the “why” matters. Here’s why.

Customer loyalty is by no means an easy or straightforward concept. After all, 75% of loyalty programs fail. Hence, asking "why" at every single step of the way of your strategy will be crucial to your loyalty scheme’s success. Let’s look at some of the most important “why” questions to ask yourself.

Why should customers join my loyalty program?

Many businesses fail to realise that while they understand the value that joining the program brings, the customers themselves might not. This is a problem that is common but easy to solve. First off, you must identify the reason to join - perhaps an initial offer (e.g. 10% off your next order), an exclusive perk (e.g. program users being the first one to know about sales), or feeling part of a community (e.g. access to discussion forums with like-minded individuals). Whatever the value you are offering with your program, it must be clear to both your team and your customers. Make it obvious in your communications and push with a single message. Keeping things simple is always the best way forward in loyalty.

Why should customers download my app?

Without a doubt, there is a saturation of apps in the market. On the other hand, consumers are equally expecting a mobile and frictionless experience from your brand. Having a good app is key but knowing why the app is beneficial to your program’s users is paramount. You must have heard this a million times: “Put yourself in your customers’ shoes.” It’s certainly true when it comes to answering this question. A mobile app is unquestionably a considerable investment for any business, which means you must know the answer to this before you start planning. Whatever the reason, understanding it will help you guide further steps, from marketing to rewards.

Why these rewards?

Choosing a rewards structure and individual perks on offer is a very complicated process. It should always start with understanding your customers and identifying their values, wants and needs. Once you have gathered some ideas of which rewards you want to offer, ask yourself why. If the answer surrounds itself around your company’s goals alone, it’s likely you’re headed down the wrong path. Yes, you need to make money and are looking for return on investment with your loyalty program. The problem is, however, that if the rewards don’t resonate with your customers, you’re never going to see that ROI that you’re after.

Why are we rewarding these actions?

What we find staggering is that 99% of loyalty programs are still only transactional. This is why I have included this “why” question here, to flag the issue early. If you’re in a process of creating the structure of your program and it is solely based on transaction-based loyalty, think again. There’s so much value that you can derive from rewarding non-transactional customer actions. From growing your social media following, to receiving honest feedback, to referrals. The truth is that non-transactional loyalty actions are highly important to your brand and seen as easy wins by your program users. So why wouldn’t you incorporate them?

Why do we need a loyalty program?

Finally, we end with the most important question of all. Whilst you may think that there is an obvious answer to this, the truth is that there’s more to it than “increase retention and loyalty”. What is the tangible problem you are trying to solve with this strategy and how are you solving it using a loyalty scheme? Is it that you’re not seeing enough return visits to your store? Or perhaps that you need to increase customer lifetime value through additional items in the basket?

There’s many ways to achieve customer loyalty. No, they’re not simple but if you have experienced partners on your side, the journey can feel easier. Here at White Label Loyalty, we have the passion and determination to help you achieve your loyalty and retention goals. Our powerful loyalty platform together with our field of expertise make us the right technology provider in your search for customer loyalty. So get in touch and start your loyalty journey with us today!

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