Winning customer loyalty is an ongoing quest that retailers have been on for decades. Customer loyalty programs, offering consumers rewards points, cashback, giveaways and discounts form the cornerstone of so many retailers’ business strategies. But how much is a loyalty card member worth? Do consumers and retailers share a similar mindset when it comes to assessing what loyalty means?
In our research, The Loyalty Divide, we examine the perception and draw comparisons between how businesses view their loyalty programs and what their customers actually think. Spoiler alert: as the title suggests, there is indeed a perception gap which we detailed out in the report and this blog. But all is not doom and gloom. The trick is taking a new approach to segmentation and understanding how to engage consumers based on their personal motivators. We looked at four typologies that stood out: The Broadcaster, The Enthusiast, The Lazy Loyal and The Seeker, which people will flip between depending on what they’re buying. Which typology do you identify with most? And perhaps more importantly, which traits are most prevent in your customer base?
This shopper can be your greatest advocator – or your biggest detractor. With social media channels as their loudspeaker, they are brand neutral but an avid sharer of the experiences that spark their passion, good or bad. In today’s world, keep The Broadcaster happy and their evangelizing will work harder for you than any ad campaign. You need to keep them interested and engaged with your brand with personal and relevant offers, incentives and meaningful communications. If you can build this level of connection, you will establish a reciprocal relationship that will pay dividends.
If this shopper were a pet, he would be a dog. They won’t shout about their profound adoration for you on social, but once you’ve established trust, they will stick with you. And although they may not have the amplification effect that the Broadcaster has they are in it for the long-haul if you deliver on your brand promise. The Enthusiast is looking for is high product quality and an enjoyable shopping experience. They expect a high level of customer service and products that align with their values.
Once this shopper finds the right fit they just want to forget about the hunt and sit back and relax in the knowledge that their choice of cell phone, laptop, sneakers and bicycle is perfect.They don’t want to shop around and often their choices are made around convenience and/or price. For this shopper, when it comes to loyalty programs, the easier the better, so schemes where points are automatically redeemed are a winner.
The Seeker is a shopper who holds little or no affinity for retail brands –they are not moved by aspirational marketing, brand loyalty, social alignment or distracting ad campaigns. This shopper is driven by the best value offers, the most competitive prices and compelling promotions. They not only hunt for the cheapest deal, but they want the best deal.
They are an inveterate deal seeker and rarely sign up to retailer loyalty programs, but they are willing to divulge personal details in exchange for a personalized offer or promotion. Just don’t expect them to come back to you next time – unless, that is, your deal trumps everyone else’s.
Even the most loyal customer is tempted by the constant introduction of new brands, new approaches to commerce and disruption of the status quo. Understanding your customers today doesn’t necessarily mean you understand them for life. Tastes change over time and internal motivations evolve. Keeping pace requires a constant level of curiosity – what motivates your customers? Where is the point of intent and how can you create a moment that captures your customers' attention and cultivates a relationship?