How to not create a Loyalty Program
How to not create a Loyalty Program
65% of consumers engage with less than half of the loyalty programs to which they belong. Why? What is wrong?
Creating a loyalty program is not rocket science, but it is not easy as it seems. There are so many things you might miss out on while building the program, such as giving better rewards or making an omnichannel loyalty program. If you desire to create a mind-blowing loyalty program for your loyal customers, you need to start right.
Today, on the contrary to the ordinary we will be discussing how not to create a Loyalty Program. Want to build a successful business with incremental growth and exponential revenue? Then try to avoid these mistakes.
What are we waiting for?
Let’s dive in:
1. Poor Loyalty Program Strategy
Let’s cut to the chase, a clear objective is crucial for a successful loyalty program. You need to ask – why do you want a program? What is it you want to achieve? Steering clear of these objectives will help to make a winning loyalty program strategy.
So, what is a poor loyalty program strategy? There can be countless things that can contribute to a badly strategized loyalty program, such as an overcomplicated enrollment process or the bad structure of redeeming rewards. These barriers create a hindrance to the goal of offering great CX with the loyalty program. Hence, you need to be very careful from the start, and for that, take your time and build a strong strategy.
An effective program has to have a proper strategy that enables participants to mix and match their preferences. A structured program allows businesses to offer customer-driven personalization that late offers smooth loyalty program journeys for customers. Structured loyalty programs cover aspects such as multiple channels for customers to join the program or improved CX at every step. Mechanisms for earning and redeeming rewards need to be efficient so that customers can receive what you have promised. You can gain a lot from your loyalty program if you have a proper structure in place to start with.
2. Weak program structure
A weak structure can make or break your program. There are many signs of a badly structured program, such as complicated enrollment processes, unattractive rewards, inability to redeem points, etc. Make sure you are not making these mistakes.
Customers want unique experiences, at least better than existing ones. Try to offer it in your loyalty program and always offer attractive rewards to your customers to stand out in the crowd. If you have a better reward system, there is a good chance your customers will join the program. Also, make sure that you are making it easier for customers. They should not face any barriers while participating in the program. For this, you need a strong program structure. Do your research, study existing programs and get the best out of customer analytics.
3. Unattractive Rewards
75% of consumers say they favor companies that offer rewards. Good news! But are you sure you are offering attractive rewards that your customers would love to receive?
Say no to the common rewards. The rewards need to be unique that keep customers engaged with the program.
If the rewards are unattractive, your customers will get bored or might leave the program. Whether it is an earn or burn program or tier-based loyalty program, make sure you offer unique rewards to your customers. They should feel excited about achieving the rewards.
Give rewards that differentiate your brand rewards from others. Plan out a strategy for a reward program, for example, send an email to your customers (valuable customers) asking what kind of reward they would be interested in? Or you can just ask your people to do research and create innovative rewards. Attractive rewards are a must if you want to get successful in your loyalty program. For example, a company might consider offering better prices to loyal customers depending on the customer’s history and spending habits. You can too.
3.Poor Technological integration
If your loyalty program does not sync with the CRM platform or if there is a higher chance of customer data leak, you won’t be able to stay consistent with your program. Always use a sophisticated CRM platform to ensure that customers are not facing any issues during the participation and the data is secured. Whatever platform you are using for the program.
Any barriers might deter them from entering the program. Data-driven is the next big thing. If you want to make the most of it, consider using the CRM platform. It allows businesses to track customers and offer valuable insights into customer behavior. Keep the technological integration updated. In the case of mobile apps, make sure your customers can make payments easily. Focus on removing technology barriers for a great experience.
5. Poor Reward Redemption
According to Bond Brand Loyalty, a leading brand loyalty agency, consumers in 2017 were sitting on $100 billion of unredeemed loyalty points.
This suggests a lot can be done to boost reward redemption.
The redemption rate is important for the success of the program. If your customers are not able to redeem rewards, your program will fail. Once you have built the engagement, the next step is to focus on increasing the redemption rate. The redemption rate is affected by several factors such as location, ease of redemption, overall program awareness, etc. The lack of an omnichannel platform is also a reason for the low reward redemption rate. So always offer an omnichannel program to offer a hassle-free experience.
The best loyalty programs have a high redemption rate because they use simple models. No matter how attractive your rewards are, they will not use them if customers don’t understand your loyalty program. Hence, create a simple reward system for your customers.
To increase the redemption rate, you need to encourage your customers to use the rewards; set an expiration date on offers, send notifications and reminders, have someone test your redemption rate, and clarify the messages you send to your customers regarding rewards. The worst thing is when your customers have to do the calculation to know the reward balance.
Hence, create a simple and easy-to-understand reward system so that your customers would love to engage with the program.
The primary goal of any loyalty program is to reward customers uniquely and encourage them to stay committed to the brand. If your program has a weak structure or any technical issues, your customers will find out sooner or later. It will disappoint them for sure and it creates a bad CX. Hence, make sure you start right so that you can build a winning program.
Choose Froogal to start with a loyalty program:
Our experience with building loyalty programs has allowed us to gather expertise, process knowledge, and learn all of the technical and analytical skills involved. With that information, we can support your business at every stage of the development and management process for a loyalty program. We pride ourselves on helping businesses to start a loyalty journey.
If you’re interested in starting a discussion about building a loyalty program, our experts are more than ready to help you. So feel free to include us in your loyalty program process. See what we offer to make the best loyalty program for your customers.