“Wrong size? We’ll charge you $12 to return your item.”
“Did you receive a broken package in the mail? Sorry, it’s not our responsibility. Please contact the carrier.“
“I can’t help you; I’m transferring you to another department. Yes, hello, what’s your problem?”
“You no longer have your invoice? Sorry, we can’t give you a refund.“
“To get your discount, you need to find your code in the email you received 5 days ago, add the item to which the discount applies in your cart (make sure you choose the right one!), and then enter your code. Oops, there seems to be a problem with your code. Good luck!“
Perhaps these situations remind you of unhappy experiences with certain companies and make you feel irritated, which would be perfectly normal!
The repercussions of a disappointing customer experience can be pretty serious—and consumers aren’t the type to forget quickly. Customer service mistakes don’t go unnoticed. After a disappointing experience, loyalty to a company can melt faster than ice cream in the sun.
Customer loyalty: A holistic approach to build
There’s no need to convince you that implementing a customer loyalty strategy should be a priority within organizations to ensure their long-term success. That said, a frequently observed problem is that strategic thinking and implementing a loyalty program are carried out in a silo by one or a few specific players, often from the marketing team. As a result, the customer experience is not reflected throughout the entire customer journey. Even worse: the loyalty program does not achieve the desired results.
To forge lasting relationships with customers, it’s crucial to recognize the importance of the entire customer experience and support the loyalty program across all customer interactions. Beyond the implementation of a loyalty platform offering points and rewards, the loyalty strategy must also be based on the adoption of a holistic approach to the customer experience, including:
Table of content
1. The CRM experience: Developing customer knowledge and improving customer engagement
Customer Relationship Management (CRM) is a fundamental aspect of a successful loyalty strategy. By integrating an effective CRM system, companies can collect, organize and analyze customer data to gain an in-depth understanding of their needs, preferences and behaviours. This information can be used to personalize customer interactions, propose targeted offers, and provide a tailored customer service.
However, beyond the selection and implementation of the CRM platform itself, it is equally (if not more) important to ensure seamless data integration between systems as well as create automated customer journeys and manage them strategically.
Customer data integration
The seamless integration of data from a variety of sources, such as e-commerce platforms, social media networks, customer service tickets, order management systems and loyalty solutions, creates a comprehensive, real-time view of each customer. This in-depth knowledge of preferences, purchasing behaviours and past interactions enables end-to-end personalization of each customer touchpoint.
Customer journey design
Automated customer journey mapping and orchestration are essential to a successful CRM experience. Pre-configured customer journeys proactively guide customers through various stages of their interactions with a brand. For example, a customer may automatically receive product recommendations based on previous purchases or birthday gifts with offers personalized to their preferences. This automation enables better responsiveness to customer needs and timely communication—all while reducing teams’ manual workload.
By combining robust data integration and automated customer journeys, companies can deliver personalized, consistent and seamless experiences during customer touchpoints. This approach boosts loyalty, sales growth and long-term customer satisfaction, strengthening the company’s position in the market.
Uber Eats case study
Uber Eats is undoubtedly one of the champions of proactive, personalized customer relationship management. Thanks to the effective use of data and the implementation of automated paths, the messages customers receive are compelling!
In fact, your interactions and purchasing behaviours are detected: you are offered promotions and rewards at restaurants that appeal to you, based on your preferences and geographical location.
To take things a step further, certain messages are sent to you at key times of the week. If you receive a notification on a Friday at 5:30 p.m. offering you a free pizza delivery, it’s hard to resist ?
2. User experience (UX): Facilitating navigation and elevating customer satisfaction
User experience (UX) is a fundamental pillar of any customer loyalty strategy for several crucial reasons. Firstly, UX aims to facilitate use and enhance satisfaction when a user interacts with a product or service. This approach significantly influences how customers perceive and interact with a brand. A positive user experience ensures that customers can accomplish their tasks efficiently without encountering frustration or confusion, thereby reinforcing their satisfaction and attachment to the brand.
In addition, the user experience takes into account user needs, preferences and behaviours, enabling interactions to be highly personalized. A deeper understanding of their clientele enables companies to tailor their solutions to individual customer expectations, resulting in increased sales, reduced abandonment rates, and positive word-of-mouth. In sum, the user experience plays a key role in customer loyalty, directly influencing satisfaction, personalized interactions, and brand reputation.
Investing in improving the user experience is a sound strategy for building lasting customer relationships and ensuring long-term business growth.
Under Armour case study
The Under Armour brand has launched its new UA Rewards loyalty program in the United States. Members are encouraged to take up sporting challenges and enter their physical activities into their loyalty account. It is an engaging initiative, entirely consistent with the brand’s values. A significant advantage of the program (over and above the points collected and gifts offered) is the simplicity with which the application can be navigated and the personalization of interfaces. By downloading the Map My Fitness app, developed by Under Armour, you can view the challenges, record your workouts directly, and consult your dashboard and points bank. The entire experience is intuitive and can be carried out in just a few clicks.
3. An integrated digital and field experience: Offering consistent support and improved customer recognition
An integrated strategy between the digital and on-the-ground experience provides consistency and continuity in interactions with the brand, which increases customer loyalty. When customers enjoy a smooth, seamless experience, as they are recognized both online and in person, they are more likely to develop an attachment to the brand, make repeat purchases, and recommend the company to others, strengthening the company’s reputation and long-term growth. This synergy between digital and physical channels ensures that every point of contact with the brand contributes positively to the overall customer experience.
In November 2021, the multinational restaurant chain McDonald’s launched its new MyMcDonald’s Rewards loyalty program in Canada. Thanks to the new mobile application, customers can now enjoy an enriched, personalized and much faster in-restaurant experience. The way it works is simple: for every purchase, customers scan a MyMcDonald’s Rewards QR code. This can be through a digital order or an order at the kiosk, drive-thru or takeout counter in a restaurant. The QR code allows customers not only to collect points but also to complete their orders and pay in advance to avoid queues. Another appreciated feature of the app is the ability to enter information from your past bills if you’ve forgotten to provide your code in the restaurant in order to obtain points. This is a fine example of a seamless experience between digital and physical channels.
4. Simple, transparent and flexible business rules: Building stellar customer satisfaction and loyalty
An effective loyalty strategy is more than just rewards and points programs. It also relies on simple, transparent and flexible business rules that meet customers’ expectations and needs. Adopting clear, flexible business policies strengthens customer commitment and fosters lasting loyalty. Here are just a few examples that our customers appreciate:
- Avoid minimum requirements to obtain an offer: Setting minimum requirements to obtain an offer can be perceived as a barrier for customers. Instead, offering offers and rewards without strict conditions makes customers feel valued and rewarded, regardless of what they spend. This approach encourages customers to make frequent and regular purchases, as they know they will be rewarded with every interaction with the brand.
- Communicate return and exchange policies transparently: Clear, transparent return and exchange policies are essential to reassure customers and build trust. By making it easy for customers to return or exchange products, companies show that they value customer satisfaction above all else. Efficient returns management cultivates customer loyalty by reassuring them of the company’s ability to resolve any problems that may arise.
- Offer flexible payment options: Offering flexible payment options meets customers’ needs and facilitates the purchasing process. The ability to pay in installments, use a variety of payment methods, or have a payment term tailored to their financial situation gives customers a sense of control and comfort. This flexibility can encourage customers to choose one brand rather than the competition.
- Avoid limiting access: Restricting access to a service (as illustrated below with Netflix, which now forbids the sharing of accounts between households) can have a negative impact on the customer experience. This translates into a loss of flexibility in the consumption of the service or product, generating frustration and a reduction in perceived value. As a result, the risk of churn increases, damaging the company’s reputation and complicating customer service, which has to deal with problems linked to restrictions. In addition, potential new customers may be put off by these limitations, underscoring the importance for companies of striking a balance between protecting their services and preserving a positive customer experience.
The adoption of simple, transparent and flexible business rules is a further step towards building a loyal and satisfied customer base, which contributes to a company’s long-term success.
Netflix case study
A lacklustre case study! Netflix, the streaminggiant, has made a major decision that affects the way we use its service. As of May 23, 2023, it is forbidden to share your account outside your “home.”
This announcement by Netflix, which takes flexibility away from its users, unsurprisingly generated a wave of cancellations and complaints on social media. The hashtag #CancelNetflix quickly started trending, with users sharing screenshots of their cancellation confirmations and expressing their frustration at the change. Its competitor, Prime Video, even joined in, using the opportunity to promote its own platform.
Whether you’re for or against Netflix’s decision to eliminate account sharing, the new rules and how the company managed the change remain debatable. Indeed, from a “business” point of view, it seems only logical that sharing accounts and passwords should not be possible. However, changing the habits of consumers who have benefited from this flexibility since 2010 is bound to create a lot of friction, especially as this decision was paired with rate increases—all this in an increasingly saturated market., Prime Video, Disney+ and Crave had already begun to gain ground at Netflix’s expense, even before the May 2023 changes.
Tightening the rules was bound to have a negative impact on customer loyalty. However, better management of the change could have lessened the negative results; for example, offering compensation to loyal customers could have made them swallow the pill better!
In short, although Netflix anticipated the repercussions, it will be a very tall order to regain customer trust and redevelop a positive perception of the service’s value.
5. Logistics and procurement experience: Guaranteeing a flawless experience
The logistics and procurement experience is fundamental in building sustained customer loyalty. To establish—and maintain—a strong relationship with its customers, a company needs to offer a frictionless experience at every point of contact, from order to delivery. Well-organized, efficient operations are critical to avoid errors and delays. A smooth ordering process, optimized inventory management systems, and transparent, real-time communication all contribute to customer satisfaction. A customer who can rely on a company to get what they need quickly, without any hassles or complications, is more likely to remain loyal.
Logistics come into play as soon as the order is placed. Reliable, on-time delivery is what customers expect. The ability to track an order in real time, choose from a range of delivery options, and receive the product in secure, well-packaged packaging reinforces the customer’s trust in the brand. When customers know they can count on punctual, secure delivery, they are more inclined to return for future purchases.
Turn mistakes into opportunities
Errors in operations and logistics are inevitable and can, unfortunately, have a huge impact on customer loyalty. Problems, such as late deliveries, lost packages or shipping errors, can lead to considerable frustration. However, proactive management of these issues, combined with responsive and efficient customer service, can transform a negative experience into an opportunity to build customer trust. Customers appreciate companies that take their concerns seriously and do their utmost to resolve problems quickly.
Reduce your environmental impact
Finally, sustainability has become an increasingly important factor in enduring customer loyalty. Customers are increasingly sensitive to environmental issues and often choose to do business with companies that adopt sustainable practices. Eco-friendly logistics, with environmentally friendly delivery choices and judicious use of resources, can enhance a company’s appeal in the eyes of eco-conscious customers.
Never underestimate the influence of operational and logistical experience on customer loyalty. Efficient operations management, well-thought-out logistics, proactive problem-solving, and eco-friendly practices all contribute to creating a positive experience that keeps customers coming back again and again. By investing in the continuous improvement of these aspects, a company can expand its loyal customer base and ensure its longevity in the marketplace.
Amazon case study
It’s impossible to miss the fact that the juggernaut Amazon has definitively set new standards for e-commerce and the logistics experience. Amazon has forced other online retailers to step up their game by shipping faster while trying to do so for free, or at least by integrating shipping costs into the cost of products and offering free exchanges.
Brand loyalty factors:
- Its Prime program offers free, fast delivery on virtually all products.
- Real-time delivery tracking: There’s no room for customer uncertainty during shipments!
- The ability to generate a return label easily and autonomously online (without having to pay return shipping costs).
- The ability to easily claim an exchange or refund in the event of a damaged or stolen parcel without giving endless proof to a customer service agent!
- Its ecological footprint: Amazon’s environmental impact is discouraging a growing number of customers, who are increasingly aware of this and are now prepared to pay more to avoid over-packaging and multiple deliveries. Nevertheless, Amazon has made a number of efforts to reduce this impact, including the option of consolidated delivery under certain ordering conditions.
- It has an impact on local businesses, but that’s a whole other subject!
Would you like to take action to forge lasting relationships with your customers and think holistically about your loyalty strategies? As loyalty experts, we offer strategic and operational support for companies looking to be proactive and stand out from the crowd. Contact us to find out more.