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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The Ever-Changing Face of Facebook

With the advent of another quarter comes another sweeping round of changes from our good friends at Facebook. In what is becoming a weird mix of techie tradition and rage-inducing behavior for the average Joe, Facebook will be rolling out a barrage of new updates over the upcoming weeks.

Now that the inevitable initial backlash has subsided (You changed ma Facebooks!1! Facebook is going to start charging for their services!!), let’s dive in and look at what’s ahead.

Timeline

The most significant update is the introduction of the Timeline – Facebook’s version of an online scrapbook. Once it’s been fully rolled out, the Timeline will replace the user’s profile page and will more closely resemble a blog, complete with a header image, summary bio information and a quick overview of friends, photos, likes and notes.

Scrolling further down the Timeline, you’ll see highlights from the user’s Facebook footprint over the years, laid out in reverse chronological order. Scroll down far enough, and you’ll see a hilarious new section for the user’s birth.

Yes, Facebook is no longer content with shaping our present and future. Zuckerberg & Co. have now devised a way to retroactively insert themselves into our past, too.

All joking aside, the interface is fairly intuitive and fun. While some have raised privacy concerns, as with every other service that Facebook offers, Timeline only works with the information that its users provide. Preventing photos or life events from being made public is as simple as not posting them.

News Ticker

If the Timeline is the most visually appealing new update, the News Ticker is probably the least (and possibly most annoying).

The Ticker is like status updates on steroids, providing running commentary – er, updates – whenever one friend comments on another friend’s photo, comment, etc.

Whereas previously a user’s interaction with their friends’ updates was mostly limited to the ones they commented on or liked (triggering notifications whenever someone else subsequently commented on the same item), Ticker operates from the assumption that users don’t want to miss a single instance of activity between any of their friends.

While I’m not necessarily opposed to the concept of the Ticker, in its current iteration, it definitely feels like information overload. It would be preferable if this feature could simply be hidden or deactivated.

Subscribe

Taking a page from Twitter, Facebook now makes it possible to subscribe to a user’s profile, rather than adding them as a friend. So in case you want to follow (a la Twitter) someone you don’t know on Facebook without the creep factor of adding them as a friend, now you can just subscribe to their updates. Then again, maybe that is the creepier of the two options…

Smart Friends lists

Oh, Facebook, again with the blatant Twitter homages. Their new “smart” Friends lists are exactly what they sound like: Facebook creates and auto-populates certain default categories (work, school, family, city) of Friends to allow users to easily view updates only from contacts in that particular group.

This isn’t necessarily a bad update, but it’s probably only truly useful for those who are approaching their 5,000 friend limit and need an easy way to slice and dice their friend-base.

Recent Stories vs. Top Stories

Finally, Facebook has revamped the way updates are displayed in the home news feed. In the past, users had the option to choose between “All Updates” – activity from all friends displayed in reverse chronological order – or “Top News,” which was aggregated and ordered based on Facebook’s EdgeRank algorithm.

Facebook has now eliminated these options by creating a hybrid of the two. The jury is still out on this new beast, but it appears that it might not be a bad compromise.

On login, Facebook displays a selection of “Top Stories” mixed with “Recent Stories.” As a user spends more time on their home news feed, Top Stories are filtered out and the feed returns to a straightforward view of Recent Stories (i.e., updates from friends/pages as they happen in real time).

Users also now have the power to select certain updates as Top Stories to further customize their news feed in the future. Conversely, they can deselect those updates that don’t make the cut for relevance and interest.

What do these changes mean for you?

While none of the most recently announced changes directly affect Pages, they are not without implications for those who use the platform to engage with customers and clients.

First, the evolution of the news feed and the introduction of the Ticker mean that it’s more important than ever for brands to publish exceptionally valuable, relevant content that encourages interaction from fans in order to ensure visibility in their feeds.

Secondly – and perhaps most importantly – despite the latest round of loud complaints from its most vocal users, Facebook’s growth shows no signs of slowing. Recent data from Nielsen indicates that users are spending an ever-increasing amount of time on Facebook – more time even than on Google, Yahoo, AOL and Microsoft sites combined. And Facebook remains dedicated to driving innovation in their interface and the ways that users can engage with the platform. As new options and features continue to emerge, Facebook will become the default online home base of more and more users, making it an invaluable vehicle of communication between companies and their customers.

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Go Mobile or Go Home

Once upon a time, not so very long ago, being available to your customers online 24/7 was enough. But then along came the smartphone – and its even more agile cousin the tablet – and the expansive mobile data networks needed to support them. Suddenly the Internet came unfettered from desktops anchored to offices and homes and became a ubiquitous presence in our lives. Today 24/7 just doesn’t cut it. You must be available to your customers not only anytime but anywhere. At the corner coffee shop. In line at the supermarket. At the airport. In the very aisles of your competitor’s store. You may not know for certain when or where your customers might be looking for you, but you can be absolutely sure that you must be there if you want to stay competitive in today’s market. Consider this statistic: smartphones and tablets currently drive nearly seven percent of digital traffic in the U.S. If that number doesn’t wow you, try this on for size: experts predict that by 2013 – that’s next year – more people will access the Internet via phone than computer. It all boils down to this: the proliferation of smartphones and tablets in the past few years has changed the game. If you’re in it to win it, you have to go mobile or go home. But where do you start?

Look before you leap.

Before you take the plunge into the world of mobile, it’s a good idea first to figure out where you currently stand so you know where you need to go and how best to get there. Peruse your website on as many different devices as you can get your hands on. Put yourself in the shoes of your customers, and evaluate the quality of your experience as you navigate through your site. How easy or difficult is it to select the specific link you want? If you have a lot of images on your site, how long does it take to render on a mobile device? Can you quickly and easily complete critical actions like locating contact information, filling out an inquiry form or even making a purchase? If you identify any obstacles, or if the overall experience is frustrating in any way, you need to take action to make sure you give your business the best chances of capturing and converting mobile browsers. There are a number of ways you can bring your site into the mobile era. To decide which approach is the right fit for your business, you must weigh your options based on your growth objectives and your customer’s browsing habits.

Option 1: Build a dedicated mobile site.

A good mobile website is not simply a shrunken version of your primary site. It’s designed specifically to deliver an experience that’s optimized for the needs and preferences of the mobile user. Keep in mind that these users aren’t typically casual browsers; they’re usually after a specific bit of information or seeking to accomplish a specific task. As a result, mobile websites don’t usually offer all the bells and whistles of their desktop equivalents. Rather, the content and functionality are pared down significantly to offer only those features that are most useful to those on the go. For example, while mobile users frequently comparison shop on their phones, they might not be as likely to actually go through the entire purchase process on their handheld device. As a result, you may not need to offer a full-fledged shopping cart on your mobile site. Instead, you might offer the capability for customers to log in to their account and save desired products to a wish list so they can quickly and easily complete their purchase later when they return to their desk. Great mobile websites have certain elements in common. They focus on critical needs, such as providing access to key services and products and contact information. They limit the use of images to minimize page load time. They offer easy, intuitive, finger-friendly navigation. If forms are included, they are streamlined and ask only for the most essential information. They don’t employ Flash, since Flash-based content is inaccessible to all iOS users.

Option 2: Employ responsive design.

Responsive design is the concept of building a website so that the layout of the site adapts and changes according to the resolution of the user’s browser, which means that it looks just as good and performs just as well on a 27-inch desktop display as a 3.5-inch iPhone and all screen sizes in between. The design is fluid and adapts to the the browser and the platform on the fly. However, the change is more than just a straightforward scaling effect; rather, certain key elements within the design – such as navigational menus, links and search fields – shift and transform according to the resolution of the browser. Employing responsive design allows you to deliver a robust experience to all users without the need to build and maintain a separate dedicated mobile version of your website.

Option 3: Get app-y.

A native app can be a fantastic mobile marketing tool, if done right. However, it’s not the right solution for everyone. Before you go down the app-building rabbit hole, there are a lot of questions to answer and obstacles to overcome. How big is your customer base? Apps require a certain scale to make sense. If you’re a mom-and-pop bakery, for example, you could theoretically develop an app that would let your customers design their own cupcakes and place their order right from their phone. While it would surely be a fun gimmick, it doesn’t fulfill a broad-based need, and the app’s ability to generate additional revenue would probably never offset the cost to create and maintain it. That brings us to another point: you must carefully consider your ROI. If you sink many thousands of dollars into development and get it approved, will people really use it? If you can’t develop an app that offers something people want and will use frequently – whether that’s in the form of utility, convenience, content or all of the above – chances are good that your investment will end up buried in the app marketplace collecting dust. Remember, too, that when you’re dealing with apps, you either have to develop a version for each operating system (Android, iOS, etc.), which can be a costly proposition, or choose just one and ignore the needs of a huge percentage of your potential customer base, which is never a smart business decision.

Be a contender.

When it comes to mobile, convenience and conversion are the name of the game. From a business growth perspective, it’s critical to ensure that your products or services are easily accessible to mobile users so you can boost your chances of capturing and converting an increasingly untethered customer base.

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