This is part one of Escher’s blog series on Loyalty and Consumer Engagement which we will be publishing over the next few weeks.We all recognise how vital customers are to business, but have you ever considered how important data and customer loyalty software are to your company? Statistics and information can be a vital component to staying ahead of your competition, retaining customers and winning new business. Think you know your business and industry? Think again! Every company and industry is facing and responding to continuous dynamic change – use this to your gain not to your disadvantage.
If the answer is no to the following questions, then an analysis of your business and customer base is needed.
1.Do you know who your customers are?
2.Do you know where they are buying certain products?
3.Do you know what method are they engaging with you? (online, web and in store)
4.Do you know why they are engaging with you?
5.Do you know when they are engaging with you? (Early mornings, late on Tuesdays etc)
Know Your Customer’s Value
While industry trends can lean towards incentivising and growing your client base, it’s vital not to neglect your returning customers. According to The Loyalty Effect (Frederick F. Reichhel), “making loyalists out of 5% more customers would lead, on average, to an increased profit per customer of between 25% and 100%”. Your company’s strategy should not be just entice new customers – it should reward and nourish existing ones. It’s not just about just knowing your customer - it’s recognizing their value.
This encompasses what has now become known as the Expectation Economy – customers and millennials are evolving and demanding more from businesses. Technology has led to quicker turnaround times and service, and in turn customers are expecting more. According to Uber, in a 2013 survey customers were happy to wait seven minutes for a taxi, however when they repeated this survey in 2014, the public refused to wait more than five minutes. After repeating this survey in 9 other cities Uber revealed the same results - that the longer they were operating in a city, the less patient the population became. They essentially became victims of their own success.
What Trends Can Teach Us
In 2014 The Internet Advertising Bureau research shook the gaming industry by revealing that 52% of the gaming audience was made up of women – a figure that startled the entire business and smashed stereotypes. Furthermore a recent study by AppLovin and TUNE revealed that mobile e-commerce behaviour didn’t mirror online purchasing habits - that spending and usage on the two platforms were at completely different times of the day.
Both of these examples of research would have huge implications for advertising budgets and plans. The lesson? Never assume. Analyse data, feedback and statistics, revise your strategy - your business depends on it.
The beauty of customer loyalty software programs are that you can reward your customer while gathering and using vital data about your customer base and business. Be warned - it is not enough to just gather this data - it is important that it is analysed and put to strategic use.
This three strand approach of rewarding customers, while gathering and utilising data is imperative to your company's success. By building yourself into the customer journey and enriching your customer experiences you are building a bond between your customers and your brand.
Why Invest in a Loyalty Programme?
So how can you progress with a successful loyalty program? The first step is to gather information about your customers and then to break down this information into key sections you can learn invaluable lessons from. Asking the Who, What, Where, How and Why can help you begin this analysis.
Balance sheets show that you have customers and that your business is profitable - however wouldn’t it be great to know more detail about your client base? By knowing your customer and exceeding their expectations you form a bond between with your brand. More importantly research has shown that customers that are part of a loyalty program are proven to generate more revenue than non-members.
Loyalty programs can encourage repeat business, help you identify gaps in your business model and influence marketing plans. Additionally, it can enable you to target new customers as well as enriching existing customer relationships.
The Surprising Ways Retail Loyalty Programs Can Work For Your Customer
From the customer’s standpoint there are a range benefits to loyalty programmes – some familiar, some untapped. The traditional benefits include free upgrades after a certain amount of purchases, or discounts based on the number of points accumulated. However, these take time to build up and are no longer a competitive differentiator. Escher customers are now using loyalty software with a different approach and offer prefilling of forms to bulk customers. Forms can be filled out ahead of time via the loyalty app on mobile or desktop. Frequently used details can be used to auto fill forms. This saves the customer and the company time and money, meaning loyalty points can be awarded for each form that is filled out, further rewarding the customer.
Additionally, loyal customers can be rewarded with express queues and service in brick and mortar retail locations. This is a great example of combing real life with digital to provide an experience that is highly valued by brick and mortar retail customers.
How Retail Programmes Can Work For You
Let’s stick with the example of a post office. Daily customers can reach millions of people using mail, parcels, bill payments and a variety of other services. Yet post offices struggle to identify these customers and are asking:
· Who is the customer?
· What services is each customer using?
· What consumer buying patterns are evident?
If we are to look deeper at the customer journey, this marks a greater need to track and therefore understand buyer behaviour. By asking questions you can uncover valuable data that can enhance your business, profits and growth.
For example, posts can now use customer loyalty software programs to provide vital business information such as:
· When are the most popular times for post offices? In analysing this, retail organisations can increase staff at counters during these times, to meet customer expectations
· How much do they spend and how are they spending it?
· What is the demographic make-up of customers? This information can be used to allocate marketing budgets accurately and efficiently.
· What other cross-sell services would they be open to purchasing such as insurance, registered mail, etc?
· How are they using the service – online or instore? And why?
By utilising this information; businesses can then research how the path to purchase can be streamlined, while providing an ever improving customer experience.
By introducing a very basic consumer loyalty program you will begin to gather valuable information about consumers. As soon as a consumer registers with your program you will begin to have data points such as name, location, age, communication preferences – all vital information for retailers.
Most importantly consumers will now have what we call an “identity”. The consumer now has a means of identifying themselves in-store (which can have an added personal touch to marketing material, and their online and in store experience). This now allows you gain visibility of the when, where and how consumers are interacting with your brand. You can begin to segment consumers based on various demographics or their buying patterns, the problems highlighted at the start of this post. By giving customers identities, we are able to track users and begin to build a database of information. Armed with this data we can establish a CRM system that actually focuses on building a customer relationship rather than simply recording information. This then becomes full circle in term of meeting, delivering and surpassing customer expectations and experiences.
As summarised by Accenture’s Report “Customers are loyal to experiences, not to companies” - if you cannot provide an enjoyable experience, then what hope do you have of succeeding in an increasing digital world?
Surpassing this Expectation Economy begins with understanding consumer needs and this is where Escher Group can help improve your business. We have implemented successful loyalty programs across the world in a variety of environments - and understand it’s value, importance and priority. Escher Group are trusted with An Post (Ireland’s National postal operator) to adapt to ever changing retail trends, and meet changing customer expectations with an omni channel customer experience.
Part 2 of this blog series focuses on leveraging the information gathered in Phase 1 of your loyalty scheme, and how to interact effectively with Generation Y - new, young and tech savvy consumers.