With increasing competition, retail companies need tools and strategies to stand out in the market and gain the loyalty of their customers. In fact, people want to be involved and have a relationship with their favorite brand; the emotional aspect is more important than the economic one and consumers expect benefits in exchange for their loyalty. In this way, companies can obtain detailed information about their customers (demographics, purchasing habits, product preferences, etc.) which can be used to create customized loyalty programs.
The pandemic had a profound impact on purchasing behavior and consumer expectations, testing the characteristics of existing loyalty programs. In 2020, the way consumers shop online has changed completely: they frequently turn to partner channels and are willing to change brands if they find greater value, availability or convenience.
What Is the Best Strategy To Retain Customers?
The main strategy is to consider each customer as an individual and not as a number among many. In fact, loyalty does not depend on the products or services sold but on the emotional connection that is generated between people and brands. Customers tend to reward, through their loyalty, the brands that best meet their needs, offer exclusive shopping experiences and personalized promotions. All these elements transform customers into supporters of the brand, thus increasing its notoriety and influence.
The companies must become aware that it is necessary to redefine the logic of traditional loyalty programs, focused on transactions and set on impersonal data. Today, loyalty can no longer be based on purchases, points or levels exclusively but it must be integrated into the entire organization and purchasing process.
Let’s understand together how retail leaders can create a new approach to loyalty programs. We will provide an overview of all the programs applicable to the sector and their benefits.
The Loyalty Programs for the Retail Sector
In the past, loyalty programs required significant investment and time to be implemented, often not being functional once on the market.
Today, with solutions like Bit2win Loyalty Management, you can quickly and easily configure loyalty initiatives.
Program setting: define the duration, model and activity the loyalty program is based on;
Creation of the members life cycle: set the type of subscription and target the most suitable offer based on customer data;
Behavioral assessment: evaluate user behavior based on program goals and engagement achieved. Configure rewards and experiences and activate follow-up actions when necessary;
Performance analysis: analyze the information obtained from the program and its effectiveness in terms of sales and engagement.
Let’s have a look at the types of loyalty programs that are most suitable for the retail sector.
The tiered loyalty programs are types of subscriptions in which customers obtain benefits based on the level they reach. The metrics that companies use to rank users are often related to sales or engagement. The higher the level a customer reaches, the better the rewards.
This type of loyalty program aims to encourage recurring behaviors and creates a sense of achievement in consumers by associating each proposed challenge with an advantage. To make progress, customers must repeat valuable brand actions, having fun while following the instructions.
It is a loyalty program based on traditional logic: customers earn points based on the money they spend. The differentiating factor is the ease of integration as the redemption rate of the rewards is limited by the rewards available. Customers benefit from these programs as the perceived value of the award is greater than the actual cost.
Integrating Loyalty Programs With Customer Engagement Solutions
Loyalty programs don’t need to stand alone. They can actually be implemented with engagement solutions that add an interesting dash of game to the entire shopping experience.
Games, challenges and awards always convince customers to take part in brand activities. They love a brand capable of involving them with innovative and funny solutions and are more willing to buy from them.
Let’s discover together some engagement and gamification formats that the retail industry can adopt to boost sales and improve customer loyalty:
Photo Contests
You can use photo contests to collect interesting and useful data about your customers, reaching the important goal of lead generation. Why should the customer be interested in participating in a photo contest? Because they love to see how brands focus on their clients making them the real stars. You can make customers participate in the contest for free, just leaving some personal data, or ask them to spend loyalty points. Usually, the customers are asked to pose with the purchased product. This improves brand awareness and makes your clients feel really close to the brand. Furthermore, we are talking about an activity that encourages customers to submit user-generated content and thus drive word-of-mouth.
Be ready to leverage user-generated contents, try our Photo Contest module
Buy & Win
Buy&Win requires customers to purchase a product, upload the receipt and, usually after entering personal data, discover if they won a prize or not. How to implement this format in a loyalty program? It’s really simple: you can reward your customers for purchasing one or more of your products with loyalty points or coupons to spend online or in store. This obviously will increase your sales and brand awareness: customers will be more willing to try and buy a product they have never tried before just to win a prize. In this way, they may try something they really like, something they will purchase again in the future. Obviously, it will increase customer loyalty too: rewards and the ability to offer your customers new products and an engaging shopping experience make them understand that you really care about them.
Want to boost your sales while rewarding your customers? Click here and find out how
Instant Games
Engagement solutions would not be the same without a touch of gamification. Customers really like challenges and games because they feel like they are killing two birds with a stone: obtaining information about a product or easily interacting with a brand in a funny way while trying to win a prize. There are actually different formats you can use to engage your customers and let them play, such as: Scratch & Win, Rush&Win, Spin Win. Their implementation will be as effective as the one with the already mentioned formats: let your customers play and have fun when interacting with you. They will remember their experience with your brand as a positive and engaging one and they will surely be more willing to choose you over the competition in the future.
Let your customers play! Click here and discover our Instant Games solutions