Loyal customers are the holy grail for most businesses. However, most brand and customer loyalty programs totally miss the mark.
A key focus of many programs is rewarding customers with points for purchases. However, when you use this as the cornerstone of your loyalty program, your customers become fans of your program instead of your brand. This more closely resembles bribery and while bribery can be highly effective in the short term, it almost never works over the long term.
If and when another competitor offers more points per purchase, then you are at risk of losing your customers. This is the loyalty equivalent of competing on price (oy!).
The traditional reward-for-purchases system also ignores influencers who perhaps don’t spend as much with you directly but may indirectly be responsible for a significant portion of sales through their evangelism. Making these influencers second-class citizens of your loyalty efforts is a gigantic mistake that is made by even the largest publicly traded companies and multinational brands.
To create brand advocates and deepen relationships, business must create a bridge between a company’s products or services and its customers through focusing on the customers’ lifestyle needs.
In some cases, this involves bringing in content, products and partnerships that are outside of what you are directly selling. For instance, luxury car companies produce lifestyle magazines and provide discounts for high-end travel for their discerning customer bases.
Food companies that target busy moms understand that for these women, time is their biggest pain point. They may create recipe files with quick meals and other time-saving tips where the “product” being sold isn’t necessarily the main star. This is all in an effort to be a relevant and trusted brand in the eyes of the customer.
Social media are focused on dialogues, but in order to be useful to businesses, those dialogues need to translate into revenue, profit and real evangelism. This means both paying attention to the ongoing conversations of your customers and creating methods to make your brand relevant and important to your customers’ lives.
So, the next time that you offer a customer one point per dollar spent, ask yourself if you are really generating loyalty to your brand, and if you’re really treating your customers like kings and queens.
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