Going the Distance: Four Ways to Build a Better Customer Loyalty Program for Your Brand

It’s easy enough for a customer to join your loyalty program, especially when you’re offering an incentive such as discounts. All your customer has to do is give out some basic information, and voila! They’re in the fold, a brand new loyalty member with your company. From there, it’s happily ever after. You offer the perks; they stand solidly by you, bringing you their continued business. Simple. Or is it? In reality, just how many of those customers are act ively participating in your loyalty program? Do you know? Sure, loyalty program memberships are on the rise according to market research company eMarketer, having jumped 25 percent in the space of just two years. However, that figure may be a bit misleading. The truth is that, while loyalty program sign-ups may be more numerous, active participation in such programs is actually in decline. At the time of the study, the average US household had memberships in 29 loyalty programs; yet consumers were only active in 12 of those. That’s just 41 percent. And even that meager figure represents a drop of 2 percentage points per year over each of the preceding four years, according to a study by loyalty-marketing research company COLLOQUY.

When discounts just aren’t enough

So what’s a brand to do? How can you make your loyalty program worth your customer’s while—as well as your own? After all, gaining a new loyalty member doesn’t mean much if your customer isn’t actively participating in your program. Consider this: Does your customer loyalty program offer members anything different from what your competitors are offering? Chances are your program includes discounts. That’s a given. And what customer doesn’t appreciate a good discount? But when every other company out there is providing this staple benefit in comparable amounts, it becomes less and less likely that customers will remain loyal to any one particular brand. Frankly, it’s all too easy for customers to get lost in a sea of loyalty member discounts. They’re everywhere. In fact, just under half of internet users perceive that all rewards programs are alike, according to a 2015 eMarketer survey. The key to success, then, is to differentiate your business from the crowd. If you can offer your customers something unique and valuable beyond the usual discount, chances are they’ll be more likely to stick with your brand. Here’s some inspiration from companies who get it.

Virgin: Reward more purchases with more benefits.

That’s not to say you need to get rid of discounts entirely. In fact, nothing could be further from the truth. Customers still love a good discount. The goal is to be creative in terms of the loyalty perks you offer. Take the Virgin Atlantic Flying Club, for example. As part of its loyalty program, the airline allows members to earn miles and tier points. Members are inducted at the Club Red tier, from which they can move up to Club Silver and then Club Gold. Here, it’s not just a discount. It’s status. And people respond to feeling important, elite. Still, even where the rewards themselves are concerned, Virgin is motivating loyalty customers with some pretty attractive offers. At the Club Red tier, members earn flight miles and receive discounts on rental cars, airport parking, hotels and holiday flights. But as members rise in tiers, they get even more. At the Club Silver tier, members earn 50 percent more points on flights, access to expedited check-in, and priority standby seating. And once they reach the top, Club Gold members receive double miles, priority boarding and access to exclusive clubhouses where they can get a drink or a massage before their flight. Now that’s some serious incentive to keep coming back for more. Discounts are still part of the equation – but they are designed with innovation and personal value in mind, elevating them to more than just savings.

Amazon Prime: Pay upfront and become a VIP.

What if your customers only had to pay a one-time upfront fee to get a year’s worth of substantial benefits? It may not sound like the smartest business idea at first glance. But take a closer look. Amazon Prime users pay a nominal $99 a year to gain free, two-day shipping on millions of products with no minimum purchase. And that’s just one benefit of going Prime. It’s true that Amazon loses $1-2 billion a year on Prime. This comes as no surprise given the incredible value the program offers. But get this: Amazon makes up for its losses in markedly higher transaction frequency. Specifically, Prime members spend an average of $1,500 a year on Amazon.com, compared with $625 spent by non-Prime users, a ccording to a 2015 report from Consumer Intelligence Research Partners.

Patagonia: Cater to customer values.

Sometimes, the draw for consumers isn’t saving money or getting a great deal. The eco-friendly outdoor clothing company Patagonia figured this out back in 2011, when it partnered with eBay to launch its Common Threads Initiative: a program that allows customers to resell their used Patagonia clothing via the company’s website. Why is this program important to customers? And how does it benefit Patagonia? The company’s brand embraces environmental and social responsibility, so it was only fitting that they create a platform for essentially recycling old clothing rather than merely throwing it away. The Common Threads Initiative helps Patagonia build a memorable brand and fierce loyalty by offering its customers a cause that aligns with deep personal values. OK, so their customers get to make a little money, too. Everybody wins.

American Airlines: Gamify your loyalty program.

If you’re going to offer your customers a loyalty program, why not make it f un? After all, engagement is key to building a strong relationship with your customer. And what better way to achieve that goal than making a game of it. American Airlines had this very thing in mind when it created its AAdvantage Passport Challenge following its merger with USAirways. The goal: find a new way to engage customers as big changes were underway. Using a custom Facebook application, American Airlines created a virtual passport to increase brand awareness while offering members a chance to earn bonus points. Customers earned these rewards through a variety of game-like activities, from answering trivia questions to tracking travel through a personalized dashboard. In the end, participants earned more than 70 percent more stamps than expected – and the airline saw a ROI of more than 500 percent. The takeaway: people like games.

Stand out from the crowd.

Your approach to your customer loyalty program should align with your overall marketing approach. Effective branding is about standing out, not blending it. Being memorable is key. To this end, keep in mind that loyalty programs are no longer a novelty. That means that yesterday’s strategies won’t work moving forward, so look for ways to rise above the noise, setting yourself apart from the cloying drone of countless other cookie-cutter programs.

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On the Right Path

When I was in college, I had a professor who spoke a lot about the importance of wayfinding. He was especially interested in how the Department of Transportation studied design elements such as typography and contrast to discover the best font and colors to use on their signs. When you drive down the interstate, those big green signs with white lettering make navigation pretty easy. Or consider the wayfinding system of a large airport. Getting from terminal A to terminal D would be a nightmare without all the signs helping us along the way. The core function of good wayfinding is to get a person from point A to point B, quickly and efficiently. In order to do that, a person navigating the system should need only to look for signs to point them in the right direction. Just as an exit sign tells an interstate driver where to get off, the visual cues on a well designed homepage should direct a visitor onto the right path.

Why It’s Important to Funnel Visitors

It is the job of the homepage to quickly funnel users to the information they need the most.We often hear the term “funneling traffic.” It is usually used in the context of getting people to visit a site from the outside via search engines, social media or a traditional marketing campaign. But it is equally important to funnel traffic once they get to your site. Your company may have several types of audiences, and you need to speak to each one in different ways. The type of information provided and the tone in which it is presented will be different depending on the audience. A site that tailors its information to specific audiences needs a way for those audiences to quickly identify which category they fit in or which area they are most interested in. It is, therefore, the job of the homepage to do that efficiently. Success in this area means getting a visitor off the homepage and deeper into the site—where you can convert them from a visitor to a customer or fan. It also means protecting them from purposeless information that gets in the way of what they’re really looking for.

Know Your Audience

Before you start funneling visitors you need to identify your audiences. By knowing your target audience, you will be more confident in knowing how to connect with them. Again, your site may have several target audiences. A healthcare site has to accommodate both patients as well as medical professionals. A nonprofit organization has to accommodate people who want to volunteer their time, those who want to donate money, and those who need to use the service the organization provides. All of these audiences have unique needs and specific requests—but before they can become more than a visitor, your site has to give them what they're looking for. The power of your site relies on your ability to focus on your audiences.

Focus Your Funneling

We’ve all been there: stopped at an intersection, not knowing which way to go. One road with two names. Two roads with one name, but going in different directions. Sometimes you just pick a road and see what happens. And sometimes you get lost and have to turn around—something you certainly don’t want a visitor to your site doing. It's natural for a business to want to accommodate every single visitor that comes to their site. Doing this, however, can quickly lead to a cluttered homepage and information overload. Or, in our transportation analogy, an intersection just like this: If your homepage looked like this, most visitors would simply hit the back button and leave your site, not only confused and turned off, but more important, with a negative opinion of your company as a whole. If your site has many types of people visiting, it is important to identify the characteristics of your core audiences in order to quickly direct your most important traffic to where they need to go. This will keep your homepage clean, simplified and actually make decision making easier for the user. Visitors given 3 choices based on core audience characteristics—as opposed to 10 choices based on characteristics for every visitor—will be able to identify their needs and navigate more quickly. Your homepage does not need to encompass every detail about your company or product. Statistically, only 30% of a visitors time is spent on the homepage. The rest is spent on deeper level pages that are better equipped to handle the needs and interests of your visitors—and move them to action.

Give Them What They Like

Once core audiences have been established, you need to determine how you want to motivate them and what actions you want them to take. It is not as simple as saying, “visitor x goes here and visitor y goes here.” You need to know what those visitors are interested in—what motivates them to delve further and eventually cause them to take action or reach a conversion point. Audiences may be influenced by statistics, testimonials, free trials or product features. By knowing what motivates your audience, you will know how to quickly grab their attention and get them to want to take action. So what kind of action do you want your visitors to take? Of course the ultimate action is often financial, whether that is buying a product or service or donating money. But there are other actions that can facilitate that final goal. You may want first-time visitors to download a demo, take a tour or request more information by filling out a form or signing up for a newsletter. Or perhaps you want to drive people to a physical store using a “find the nearest location” feature.

Bringing It All Together

Now that you know the who, how and why, it’s time to bring everything together in a killer homepage design that will not only look great, but function seamlessly as a visitor’s guide to your site. Many well-designed sites begin with a large introductory headline and a brief opening paragraph that gives the visitor a snapshot of what the company is about or what it is selling. The funneling occurs with individual modules that target a specific audience. Designs should be clean and contain good contrast to quickly identify elements. Headlines should be specific, leaving little doubt who the following information is intended for. Typically, “more” or “continue” buttons are used, prompting the visitor to explore the next level of the site. Often pictures of a product or other graphical elements are used to entice the visitor into wanting more. Here are examples of sites that do this well.

Conclusion

Your homepage is not only a first impression, but the starting point to an experience. A good homepage is a spring board that motivates people to explore more important areas of your site. It clearly direct visitors to the information they need the most to get them to a final destination. And if their journey is a pleasant one, you're one step closer to a repeat visitor, fan, and even customer. Happy trails!

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How Warby Parker Conquered Social Media (And You Can Too)

Warby Parker is an eyewear company on a mission. In 2010, co-founders Neil Blumenthal, Dave Gilboa, Jeff Raider and Andy Hunt set out to revolutionize their niche by creating boutique-quality, classically crafted eyewear at a revolutionary price point.

Today, they sell frames and lenses together for a flat low price of $95. Not only do they produce a high-quality, affordable product, but they also do so with a conscience: for every pair of glasses sold, a pair is given to someone in need.

It’s an indisputably great concept. But how did they skyrocket to success so quickly? Well, they had a little help – from the community of followers and evangelists they’ve cultivated through their activities on key social media networks, specifically Facebook, Twitter and Pinterest.

While their business model may be unique, their approach to community building offers great lessons in social engagement that you can implement to fast-track the growth of your business:

Facebook

How they did it: Warby Parker is currently just shy of 100,000 followers and still growing daily. The strength of their appeal on Facebook lies in their prolific use of images through status updates, albums and user engagement campaigns.

Since the arrival of the Facebook timeline, images are more important than ever. According to Facebook Marketing, “photos and videos get 120% and 100% more engagement respectively.”

How you can do it: The equation is simple: more images means more interaction, so it’s time to get visual.

Here are a few simple ways you can amp up your use of photos and videos on Facebook:

Attending an event? Snap a photo or video and post it to your page. For greater convenience, install the Facebook Pages app on your smartphone so you can share on the spot without needing to be near a computer.

Published a new blog post? Share the photo you used in the post, then caption it with a catchy hook followed by “Read more here:” and the URL.

Just released a new collection of products? Create an album featuring a photo for each new item in your link along with a quick description and a link to your e-commerce site to drive sales.

Twitter

How they did it: With nearly 28,000 followers to date on Twitter, Warby Parker (@WarbyParker) has a well-branded page and a strong team of community-builders behind their tweets. One of their strongest assets is their consistency in responding to customers, potential customers and fans.

Take a quick peek at their Twitter page, and you’ll instantly notice an unending list of tweets in direct response to another Twitter user. According to Carol Rozwell, vice president and analyst at Gartner, “The dissatisfaction stemming from failure to respond via social channels can lead to up to a 15 percent increase in churn rate for existing customers.”

While it’s impossible and impractical for a growing company to respond to every mention on Twitter, it’s an important practice to engage as much as possible with the community. From my own personal experience I can say that I’m much more likely to be a loyal customer of and an evangelist for a company, product or service that responds to me than one that doesn’t. Not surprisingly, my personal choice of eyewear is, in fact, Warby Parker, and much of that has to do with the responsiveness and excellent customer service they provide through Twitter.

How you can do it: Responsiveness is the name of the game. You should try to over-serve your customers at every turn.

The most efficient way to do this is to assign a specific person — ideally a customer service specialist who is also socially savvy themselves — to monitor your Twitter feed on a daily basis. By delegating the task to one person, you can ensure that your responses are consistent, timely and safeguard the value and reputation of your brand. With the pace at which the social media world moves, if a comment or concern from a follower lingers for even a few hours unanswered, people will take notice and will perceive that you have ignored their tweet.

One important cautionary note: if a follower brings up a problem, acknowledge it publicly, then resolve it privately via phone or email.

Pinterest

How they did it: Much like they’ve done with their Facebook presence, Warby Parker has used the power of images to connect with their customers on Pinterest. They currently have over 6,000 followers, 27 boards, 1,800 pins and more than 1,600 pin likes.

It’s worth noting that they are using Pinterest in exactly the right manner – not as a tool for shameless self-promotion but rather as a vehicle to provide greater value to their customers and to create an overall image for the brand that people gladly want to identify themselves with. For example, one of their boards is called “Jasper: A Vintage Outlook,” and simply features vintage-inspired images that echo the brand’s look and feel.

Another technique they use is cross-promotion. On their “Bespectacled Bloggers” page, they feature bloggers wearing Warby Parker frames. This serves to not only add credibility to the brand, but also to increase traffic to blogs that support Warby Parker. It’s a win-win.

How you can do it: Focus on providing value first and foremost, and allow promotion to happen organically as your followers take your great content and run with it.

Self-promotion need not be avoided completely; however, it’s important to do so in a tasteful fashion and not to let your social media sites be solely focused on you. This will allow you to generate a real community around your brand, product or service, because you’ll become a source rather than a salesperson.

Much like Warby Parker has done with their Pinterest page, think about the kind of things your consumers are interested in (other than your product), and provide valuable content based on that. People will be more inclined to engage with what you post when it’s valuable to them, rather than when they feel like they’re being sold something all the time.

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