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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Don’t Fear the Reviewer

Does the idea of allowing your customers to rate your products on your website make you uneasy? If so, it’s time to reverse your thinking: don’t fear the reviews; fear what their absence is costing you. Here are four reasons why encouraging your customers to post product ratings will not only strengthen their allegiance to you but also help you capture more sales:

Break through the trust barrier

As we established previously in our article on the culture of the Web, the Internet collective harbors an inherent mistrust toward all corporate entities, and unfortunately for you, retailers are no exception to that rule. On the other hand, peer validation is everything. No matter what you do or what you sell, if people love it and vouch for you, you’ll be strongly positioned for success. In the absence of this corroboration, you face a significant burden of proof to overcome the natural skepticism of the collective. What does this mean for you? You can spend hours meticulously crafting eloquent descriptions for each and every product you sell, but they will never carry the weight of a review that one of your customers spends five minutes to dash off. Reviews demonstrate that you stand behind your products and you have nothing to hide.Fair? Perhaps not. True? Absolutely. It’s all about trust. However, when it comes to trust, you actually get extra credit for the very fact that you do empower your customers to publish their feedback on your site. For new visitors who may not be familiar with your brand or your reputation, these reviews are a badge of transparency that demonstrate that you stand behind your products and you have nothing to hide.

Tip the scales in your favor

Online shopping is a fact of life in today’s world. However, as commonplace as the act of buying on the Web has become, there is always still a lingering hint of uncertainty that resides with customers because they cannot see, hold and judge an item for themselves before committing to the purchase and paying the associated shipping costs. This effect is multiplied for certain types of merchandise like clothing and shoes. I may know that I generally wear a size 11 running shoe, but when deciding between different brands and styles, how can I tell whether my chosen shoe will run true to size, offer the level of cushioning I desire and be comfortable for a five-mile jog? The last thing you want in this situation is for me to give up and go to a bricks-and-mortar store where I can try before I buy, even if it means paying a bit more for that luxury. This is where customer reviews can save the sale by providing the reassurance I need to feel confident that the particular shoe I have selected will meet my expectations.

Turn your customers into salespeople

Returning once again to the qualities that define the culture of the Web, one of the fundamental characteristics of the Internet collective is their compulsive need to share. As a result, when someone buys something that they love, it’s practically second nature for them to talk up their purchase on sites like Facebook and Twitter. This tendency is all the greater when they can boast about a particularly unique find or an especially good bargain, as they seek the approbation of those in their social networks. It’s the virtual equivalent of taking a girlfriend along on a shopping excursion and having her ooh and ah in approval over your selections. Why not give your customers a soapbox to exercise their habitual need to share on your own site, where their opinions can help persuade other shoppers to purchase the same product when it is right there in front of them, just one click away from landing in their cart? One of the most effective customer review systems we’ve encountered is on gap.com. Not only does Gap allow customers to provide thorough evaluations of each item in their own words, but each product can be rated on several different criteria, including overall sizing, fit through the arms, chest and shoulders as well as the type of occasion for which the item is best suited (i.e. work, going out, etc.). If the prevailing sentiment among reviewers indicates that a shirt runs small or tends to shrink in the wash, I know right away to order a size larger than usual, and I can feel certain that I won’t regret this decision when my order arrives at my doorstep. Furthermore, let’s say I’m a little iffy on whether or not to buy a pair of pants based on how they look in the photographs. Rave reviews from those who have already purchased and worn the same item can provide the tipping point that will persuade me to add them to my cart. Detailed and informative reviews give shoppers the confidence boost they need to complete the transaction.As these examples demonstrate, not only will detailed and informative reviews give shoppers the confidence boost they need to complete the transaction, they can also provide enticement to splurge on additional unplanned items. As a result, chances are good that you will yield a greater number of conversions as well as an increase in the total amount of each sale.

Do your own market research

Your customers buy products from you. Inevitably, those customers have opinions about their purchases. If only you could benefit from knowing what their opinions might be. It just so happens that you can, and you don’t have to spend a boatload of cash on a consumer research study to do it. When you invite your customers to post their reviews of your products on your site, you not only open a direct line of communication, but you also send a clear message that you care about what they have to say. Open a direct line of communication with your customers.Better yet, because it is up to the customer to take the initiative to provide their feedback and they can do so with relative anonymity, you can be confident that you are receiving their honest and unfiltered opinion – much more so than if you tried to solicit a response face-to-face or with a formal survey. Although these reviews do not represent a statistically accurate sampling of all your customers, they can be instrumental in revealing insights that can be invaluable in helping you shape your product offering to better meet their needs. Even when you’ve done your homework and made your best effort to provide a great selection of high-quality products that align with your customers’ interests and concerns, there’s nothing like the candid reassurance of those customers to let you know that your instincts were right. You might even find an unexpectedly strong preference for a certain type of item over another, in which case you can consider expanding your offerings in that category. But wait! What if the feedback you receive is negative? You should be equally appreciative of the opportunity this creates to go back to the drawing board and figure out better ways to give the people what they want. Maybe the response is “I like this, but I really wish it had more of that.” Without reviews, this sentiment might never have come to light, and your customers might have just silently drifted away, leaving you wondering where they went and why. Or perhaps your reviews alert you to a problem that emerges when a product is used over a prolonged period of time or in a particular set of real-world conditions. Even the best quality control efforts can’t forecast and circumvent every potential pitfall, but armed with this knowledge, you can take proactive measures to address the issue and make it right.

Open the door to greater success

If you’ve made the investment in creating a smart, user-friendly e-commerce store, why not seize the opportunity to yield the most from that investment by adding functionality that can multiply your sales? If you’re not sure where to begin, let Fame Foundry’s expert web development team help you develop a customer feedback module that is custom-tailored to fit your brand, your product line and – most importantly – your customers.

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The Who, What, When, Why and How of Successful Email Marketing, Part II

Email marketing: it’s not the newest, shiniest weapon in your business growth arsenal. But there’s no denying that it’s still a highly efficient and cost-effective way of communicating with your existing customers as well as new prospects. But don’t let the low barrier to entry lull you into a false sense of security. There are certain fundamentals you must follow if you want to create a campaign that captivates and motivates versus one that is ignored and condemned to the trash folder. In part one of this series (http://www.famefoundry.com/11041/the-who-what-when-why-and-how-of-successful-email-marketing-part-i/), we examined the quality of the recipients to whom our campaigns are sent and solidified a strategy for when and why to send them to ensure that we do not overwhelm those recipients with messages that are unimportant or unnecessary. Now, we’ll turn our focus to the remaining two fundamentals of email marketing success: what we will say and how that message will be delivered.

The How

No matter which email marketing platform you use to create and send your campaign, all include templates that provide designated areas for content that can be easily edited. The issue with these templates, of course, is that they are, well, templates. As a result, when you use them, you run the risk that your emails will look nearly identical to others that your customers receive, and simply adding your logo is not enough to create real differentiation. As a result, used as-is, they can make your marketing campaigns look cheap and unprofessional. This is why customization is a must. All of these email templates are built with HTML, the same programming language used to construct websites. Behind the scenes are code and images that can be edited to create a more custom-tailored look and feel. Due to the highly technical nature of making modifications within the HTML code, this is probably not something you should DIY but rather entrust to your web development team. They can shape and refine these pre-existing templates or even create a completely unique template design from scratch that integrates seamlessly with all elements of your brand’s visual identity (i.e., your website, printed materials, etc.) and sets you apart your competitors. Whichever approach you choose, this represents a relatively small one-time investment that will pay great long-term dividends as you use your branded templates time and time again. Ideally, you’ll want to establish a few different email layouts that can be used for various purposes, such as newsletter-style content, major announcements and perhaps service alerts or other time-sensitive notifications. The template formats you require will of course depend on your business needs, but by having a few on-hand to choose from, you can ensure all of the email communication that you send reflects well upon your brand.

The What

Subject, subject, subject

No matter how beautifully designed your email might be, that design isn’t worth the pixels it’s transmitted on if your message goes straight to the trash unread. Your subject line is the make-or-break factor that will determine whether the recipient will grant you even just a few seconds of their precious time and attention. A line that’s boring and unimaginative provides zero motivation for them to give your message a second glance. One that’s too over-the-top screams “SPAM!” and is just as likely to be ignored. Subject lines that are too long, written in ALL CAPS, filled with exclamation marks or intentionally deceitful (e.g., including “Re:” to make the email appear as if it’s a direct reply to a message from the recipient) are guaranteed to work against you, so avoid them at all costs. Effective subject lines are neither vague nor dull. If you received an email with the nondescript subject line “News Update,” would you read it? Neither will your customers. Similarly, the subject line “April Customer Newsletter” explains what the email itself is, but it offers no insight into the content of its message. For my own company’s email newsletters, we have eschewed these types of easily disregarded subject lines in favor of more descriptive ones that tease the content. In doing so, we have achieved much better open rates. One way to boost the success of your subject line is to frame it in the form of a question, such as “Are you considering a move to the cloud for your business?” or “Do you know the reasons companies usually struggle with a move to the cloud?” Those two subject lines are ones I actually tried recently along with a more straightforward one – “Challenges of Moving Your Business to the Cloud”. While all three saw relatively good open rates, the two that posed a question to the recipient well outperformed the other. Start paying attention to the emails that land in your own inbox. Which subject lines catch your eye? Which do you gloss over without a second thought, and which ones prompt you to hit the “delete” button immediately? Soon you’ll begin to discern which types of lines are most effective, and you can apply these techniques to your own campaigns.

Inform, don’t overwhelm

Now that you’ve formulated an attention-grabbing subject line that will motivate your recipient to open your email, the next challenge you must conquer is the content of the email itself. All too often, companies try to communicate too much via their emails, with the end result being that the recipient is too overwhelmed to fully process and take action on the information being conveyed. Many email newsletters fall into this trap, with company announcements, blog articles, product highlights and more crammed into a single message. In an attempt to make sure the recipient has access to every piece of information that could possibly be of value to them, the e-newsletter becomes a scattered mess that lacks organization and direction. Additionally, this information is usually presented in full within the body of the message itself, instead of prompting the reader to click a link to access the full text via a web page. As a result, the number of ideas coupled with the depth of their presentation spells doom for the campaign. A quick scan of the message is enough to turn the recipient away because they have no desire to invest the time necessary to sort though the barrage of content to find the one or two bits of information that might be of use to them.

Be a tease

Avoid this “much too much” trap by editing and teasing your content. Include no more than three key ideas per newsletter. Sure, you may have more than three things to say, but you must be ruthless in your selection process, and save the rest for another missive or another medium. Next, present those three (at most!) ideas in the form of short teasers. A title, a short intro to the news item or article being highlighted and an accompanying image are all you need to pique your reader’s interest – along with a link prompting them to read more on your company’s website. By doing so, you’ll ensure that your email newsletter offers a clean, visually appealing presentation that can be scanned and processed in a matter of mere seconds. If a reader is interested in one of the three key ideas you’ve presented, they have the option to easily obtain more details for themselves. Of course, this approach has the added benefit of driving users to your website and increasing that site’s exposure to new audiences. When I suggest this “click to read more” approach, the reaction I most often receive is that readers “don’t like to click a link” but rather want to read the article in their email message. I have no idea where this belief came from, but it is false. Users are more than comfortable with clicking links, especially if it comes from a trusted source (see Part I for the benefits of using a carefully curated email list of customers who know who you are already). The Internet is driven by clicks, so do not be afraid to embrace this behavior! By mastering these five fundamentals of successful email marketing – the who, what, when, why and how – you can help to ensure that your messages are a welcome presence in your recipients’ inboxes, that they are read and, most importantly, that they motivate your customers and prospects to take the action you desire.

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