Loyalty programs are about more than just the distribution of points. Creating loyalty is about engagement. It’s about optimizing the experience of your best customers when they interact with your brand. This means identifying the challenges your customers face and the actual and potential problems they may face in future. Before you even begin to think about your program’s concept, take the time to identify these challenges.
Challenges and problems
When planning your loyalty program, you must put your target customers at the heart of your thinking process. You need to understand who they are and, moreover, the challenges and problems they face when interacting with your brand.
By identifying these challenges, you’ll be able to build a loyalty strategy that works to solve them. What bothers customers during the purchase process? What challenges are linked to the booking process or customer service centre?
Don’t hesitate to get out in the field—put yourself in your clients’ shoes, speak with employees, survey customers, and analyze the data you collect.
What needs do your clients have when it comes to your products and services? Are any of their needs unmet? How can you make their lives easier? Make sure you don’t build a program around your own preferences and interests, but rather your clients’ very real needs. It’s a good idea to conduct research to identify what those needs are.
Steve Jobs once said that his company’s job was to figure out what clients are going to want before they do. This idea applies just as easily to loyalty programs. Make sure to get ahead of your customers.
The Starbucks reward program is a great example of this. Before contactless payment became the norm, Starbucks was already allowing customers to add money to a virtual rewards card to pay for their order by smartphone (all while earning stars towards free items). This service made customers’ lives simpler because it responded to a need and addressed a challenge. Now clients could spontaneously buy a coffee on the way back from a walk at lunch without having to carry their wallet around.
Starbucks has continued to evolve by introducing pre-order service, which enables customers to order and pay for their purchase via the Starbucks mobile app and simply pick their order up at the counter without waiting in line. How many of us have decided not to bother ordering when we see how long the line is? Pre-ordering with an app solved this issue.
Over the years, Starbucks perfected how to identify their customers’ problems and needs in order to improve their loyalty program. The result? It’s now one of the most successful and well-loved programs in Canada (and beyond).
Designing the right strategy
In conclusion, before you think “I want my loyalty program to look like X and Y,” take the time to understand your customers. Identify problems and challenges, and invest in understanding their needs. Else you risk creating a program that’s not the right fit for your target audience. Why would clients stay loyal to you if you’re not meeting their needs and addressing their challenges? Build your strategy in response to what they’re looking for. Your loyalty program will then be relevant to customers and profitable for your company.