In recent years, customer loyalty programs have seen a significant rise in popularity. As the cost of living crisis has prompted consumers to seek more value for their money, loyalty programs – and the discounts and incentives they unlock – have become an appealing solution. In fact, a 2023 survey by IAG Loyalty found that 92% of UK consumers are relying on loyalty programs to get extra value. At the same time, more and more brands have increasingly adopted programs to combat waning repeat purchase rates in a highly competitive market.
With the widespread adoption of loyalty programs, the challenge now is how to stand out. In the U.S., eight in ten people are part of at least one loyalty program. Meanwhile, in the UK, 94% of grocery shoppers hold memberships in at least one supermarket loyalty scheme, averaging 3.4 memberships each. In such an over-saturated space, how can retailers successfully rise above the noise and drive real brand loyalty? Here are three ways to help your program standout.
Underscore the Value Proposition
The foundation of any successful loyalty program lies in its value proposition. 52% of consumers say that the primary reason to leave a loyalty program is feeling that rewards are not worth it. Customers need to perceive clear, tangible and consistent benefits that make their continued patronage worthwhile.
Tesco Clubcard is a leading example of how to truly communicate value to customers. Not only did Clubcard lead the way with member-only discounts via its Clubcard Prices, but the grocery stalwart also ensures that these savings and benefits are consistently and clearly communicated to their shoppers. Clubcard members receive personalised offers based on their shopping habits, regular reminders of their points balance in email, app and online, and the opportunity to further their savings via gamified Clubcard Challenges. Each touchpoint is a consistent reminder of the value the program delivers.
Create a Seamless Omnichannel Experience
In today’s retail environment, customers interact with brands across multiple channels—online, in-store, and through mobile apps. Ensuring a seamless and consistent experience across all these touchpoints is vital for maintaining customer engagement with a loyalty program. An omnichannel program allows customers to earn and redeem rewards regardless of where they shop, providing a cohesive and convenient experience. Beauty brand e.l.f are truly market-leading in this regard: their loyalty programme allows members to upload photos of their in-store receipts – including receipts from other stores like third-party retailers Ulta and CVS – and claim loyalty points for every purchase. Users scan receipts directly in the e.l.f app and points are credited to their account.
Build a Community
Creating a sense of community around a brand can significantly enhance customer loyalty. Loyalty programs can serve as a platform for fostering this community, offering members exclusive access to events, online forums, and social media groups. When customers feel part of a larger community, their connection to the brand strengthens, leading to increased loyalty and advocacy.
Huel is a leading example of building a great community. The meal-replacement brand has successfully built a vibrant community around its products by creating spaces for customers to share their experiences, ask questions, and provide feedback. Huel’s online forums and social media groups are active and engaging, allowing users to connect over their shared interest in health and nutrition. This sense of belonging not only fosters loyalty but also turns customers into brand ambassadors who spread the word about Huel’s products.
Incorporating community-building elements into your loyalty program can create a similar effect. Offering exclusive events, such as virtual meetups or in-person gatherings, gives members a chance to connect with like-minded individuals and feel more closely tied to the brand. Online forums and social media groups dedicated to loyalty members can facilitate discussions, share tips, and provide a space for feedback, making customers feel heard and valued..
Conclusion
In conclusion, driving customer loyalty in the retail space requires a strategic approach that prioritises value, engagement, and community-building. By implementing a well-designed loyalty program and continuously refining it based on customer feedback and performance metrics, brands can cultivate long-term customer relationships and stand out in a crowded market.
Sign up for our waitlist now at marketing@wecomm.co.uk to unlock unparalleled insights, unforgettable events, and unbeatable networking opportunities.
Keep up to date by following us at Future of Retail X
