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The six dimensions of a successful loyalty program
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Data
Strategy
Value
Exchange
Technology
Commercial
Execution
Member
Experience
Optimising customer loyalty is a top-five priority for many companies, in a crowded and competitive market. Here we discuss how to get the loyalty magic just right, so you have the perfect balance between the six dimensions of a successful loyalty program.
The Six Dimensions
of Loyalty
Collinson On…
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In most cases, benefit is measured as marginal incremental returns, making a couple of percentage points difference in a customer’s preference.
This can lead to very significant commercial gains, particularly for high spend but also across relatively ubiquitous vertical sectors like airlines and, of course, retail, financial services, fuel, telco and utilities. But that only tells some of the story.
Successful programs are the gateway to deeper customer relationships, associated with myriad benefits such as the generation of zero party data, the creation of a communication channel with the most valuable customers and insight for incisive action right across the business.
There are also the benefits of competitive differentiation (assuming the program is built hand in hand with brand) and access to a large closed-user group for beta testing new concepts and clearing distressed inventory.
What are the ultimate benefits of a loyalty program?
Collinson helps its clients realize these benefits, based on the expertise, experience and blueprints which result from managing over...
500m
loyalty transactions every day.
The six dimensions of a successful loyalty program
At Collinson, our approach to loyalty programs is based on six design dimensions which continually create and manage the balance required for success. Whether that’s customer value proposition versus company affordability or even the company’s need for data insight pitted against the customer’s desire for privacy and data protection rights, strategically effective loyalty is about striking this balance.
Acquiring customer data and sustaining customer loyalty for long periods is a never-ending challenge that every business faces. While most consumers are members of more than 12 customer loyalty programmes, they are active in less than 50% of those programmes. What makes some programmes more successful than others and how do you make your customer loyalty programme one of those that people use, share and talk about?
At Collinson we work tirelessly with customers to unlock the magic within their business, to design build and deliver the best loyalty programmes that set them apart from their competition and drive desired change – more mindshare, wallet share, advocacy, and Loyalty.
To learn what we’ve done for businesses like yours and how we can leverage Salesforce loyalty management technology across Customer 360 to help you achieve your customer vision and bring your loyalty strategy to life, please get in touch.
Collinson
About Us
Stephen Gilbert
Vice President Salesforce Loyalty
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For more detail on six dimensions, get in touch.
And finally…the power of creativity
Along with the details of loyalty design and delivery, there is the need for a big program idea or the ‘wow factor’ to create cut-through and differentiation. Whether a rewards program, free membership or paid for subscription, the ‘program brand’ is the promise to the customer. Collinson can help with innovation techniques and expert facilitation here, helping clients break free of current thinking and inject new creative concepts which bring all of the sound strategic work to life.
Einstein may have said ‘Imagination is more important than knowledge’ but in our view, it’s optimal to have both! The six dimensions are strategic pillars which - combined with the power of invention - consistently prove a powerful combination for our clients in the creation of enduring loyalty.
At the heart of any successful loyalty program is a value exchange favourable for all parties. The best CVPs ensure members feel they are deriving real value in return for their loyalty. That means creating a system of rewards with high perceived value but lower cost to the business.
Nailing this value exchange is where many loyalty programs struggle. What effort and value do you need to put in on one side to support and motivate the desired behaviour on the other? Our approach here will help you get the ratios right and balance the scales, ensuring that customer needs, brand strategy, technical capabilities and competitor offerings are considered in the construction of your CVP and ensuring it is affordably manifested for the business.
Value Exchange
The totality of a loyalty program is the sum of complex moving parts and - from a technical perspective - this entails looking at end to end customer journeys to map all elements across brand promise, customer value proposition and member experience.
Collinson’s architectural design considers all of this and more to ensure the chosen technology can deliver all the functionalities and capabilities that sit behind successful schemes, allowing customisation, integration, profiling, hyper- personalisation, tailoring, real-time rewarding and much more. Our methodology draws clarity out of complexity, ensuring technology is aligned with the program’s purpose and business ambitions.
Technology
Loyalty planning and implementation is a transformation exercise, even for a major refresh of an existing program and all key transformational components require consideration in advance of execution. Customer centricity becomes key and customer value a top priority.
Defining how an organisation needs to adapt is critical, with clear metrics, targets, incentives, structures, responsibilities and reporting lines. Teams, steering groups, ways of working, meeting cadences and structures, change processes and even the right language need to be established and documented.
Daunting as this may seem, breaking down the tasks into key areas to address – typically people, process, technology, data and culture - often helps. Our focus here is to help clients identify all dependencies and prepare them optimally for smooth and seamless execution.
Execution
Loyal customers have high expectations of their interactions with the brands they buy and love. Membership must mean something and increased share of wallet requires active engagement. Unfortunately, internal siloes can make their experience less than seamless. Data is usually separated and not shared, so frontline systems and staff have little chance to tailor recognition and rewards. Loyalty programs can resemble a swan swimming - effortlessly on the surface - but below furiously using manual workarounds on legacy technology to deliver on the customer journey in line with the brand promise.
Collinson consultancy helps clients avoid these pitfalls, joining the dots to create seamless CX. Optimising the experience involves orchestration of content and offers personalised towards individual member profiles, triggered based on near real time interaction and combined with a member's historical activity. To achieve this, changes to people, processes, and systems are needed. Knowing where to focus creates momentum and saves money.
Member Experience
A core tenet of loyalty is rewarding and recognising a customer’s specific behaviour and creating tailored added value experiences for them, using the collected and self-declared data available without falling foul of data regulations.
You data strategy should also serve the broader business, providing invaluable customer insight and MI. Strategic data advantages can lead to market dominance, as players like Amazon have shown. Loyalty programs create a huge amount of data, yet managing the sheer volume, velocity and variety can be an overwhelming concept for many.
And yet, at the same time, data leverage is a key goal. With our clients, we deep dive into all key aspects of data strategy as it is so critical to success.
Data Strategy
Often, loyalty is managed like any other Profit and Loss (P&L) in the business - as a separate, vertical entity. However, this blinkered view can lead to misguided decisions. A broader cross-functional perspective allows loyalty to permeate the entire organisation because it is nothing less than the embodiment of a brand’s customer relationship vision.
And yet of course, commerciality comes into it. There are costs to be controlled and judged versus value creation - investment to be made based on manifold future returns. How best then to leverage long term future value from your loyalty program? Our methodology looks at the economics of your program and how to build an evidence base to help prioritise investment, control costs and inform future development.
Commercial
