01 March 2016

Hold onto your seats, it’s a bumpy ride ahead

The Budget confirmed it. Times are hard, and they are about to get a whole lot tougher for consumers and retailers alike.

Households are cutting back on spending, while trying to make ends meet. Brands now need to pull out all the stops to keep loyal customers happy, and need to work harder to entice new ones. While there is no magic formula for success, it’s increasingly obvious that rewarding loyal customers, and those spending their hard earned Rands makes sense.

Research shows that loyal customers are more profitable in the long run, and in a downturn loyalty might just be the magic bullet to keep consumers spending. However, agility is key. Today we are dealing with tech-savvy consumers, so loyalty programmes need to adapt their models to meet the new consumer’s needs, efficiently and effectively.

There are a wide variety of loyalty marketing programmes: rebate / cashback programmes; discount programmes; frequency / punchcard programmes; and points programmes to name a few. While most pin their strategies on discounts, the element of ‘surprise and delight’ when the consumer is rewarded beyond their expectation, are the most memorable and likely to drive additional spend in-store.

And whilst creating a great loyalty offering is key, a big driver of uptake is the programme delivery mechanism. With the postal system issues and internet penetration challenges, mobile offers the most efficient tool for rewarding consumers pre-store, in-store and post-store in the most effective manner.

The more effortless the experience, the more likely the uptake. The clunky systems of the past where a consumer would need to pay with one card, present a loyalty card and earn points is no longer good enough. Mobile, however, easily converts this into a seamless experience.

In fact, it is consumers’ desire for a seamless, compelling and personalised brand experience which is driving the next generation of customer loyalty, Loyalty 2.0. By making loyalty programmes more accessible through technology, customers are more likely to actively engage with them. In the US, mobile coupons are part of daily shopping habits and are a key driver of engagement and loyalty. An estimated 71.4 million of American adults will have redeemed a coupon using their smartphone by the end of 2015 as predicted Statista Inc research.

At home, Shoprite Group’s Eezicoupons delivers instant shopping discounts via its mobile app, bringing considerable savings to local shoppers, building loyalty and serving up valuable data to continually drive a more relevant shopper experience. vida e caffe’s loyalty app seamlessly integrates real-time loyalty accrual, payments and gifting through one easy-to-use app.

With the year ahead set to be rocky, it’s time to ramp up loyalty programmes. Here are some tips for producing a more effective loyalty program:

Reward better, add an element of surprise and delight
Take away the hassle, make the experience easier and better than before
Get personal, know your customer
Get your customer’s opinions, and reward them for engaging with your brand
Use technology to deliver seamless, agile loyalty
No matter what, make your loyalty programme easy to use, engaging, valuable and most of all memorable.

Terry Steenhuisen
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