THE CLARUS Blog

Customer Loyalty in the Age of Unlimited Choice

I was recently looking for a bathing suit, so I checked GQ for some advice. Turns out that GQ doesn’t have much for dad bods, so I started to do some Googling.

There were seven or eight different sites I popped around looking for the styles I liked and of course a good deal. All told, I must have looked at close to 100 bathing suits in 20 minutes.

In the past, looking at that many options would have left me traveling to multiple stores and frustrating my wife as I got angry. Even though most shopping still happens in store, the internet has fundamentally changed the way we interact with brands and how we shop.

I bring this up not just because the internet is an easier place to shop. The big change here is that consumers’ options have gone from finite to unlimited.

While they may have been confined to local department and apparel stores in the past, the options are endless online. Welcome to the age of unlimited supply.

Try a Google search for “men’s bathing suit”. It brings up 42 million results.

This changes a lot.

This trend will also continue. Amazon is aggressively getting into apparel. It already has over 100,000 results for men’s bathing suits. We’ve seen the same story over and over in various categories.

The age of unlimited supply has changed the way that business needs to be done.

 

As Customer Experience Rises, Don’t Leave Loyalty Behind

The fact that customers have infinite choices is changing the retail industry and making it even harder to retain loyalty customers.

Standing out from your competition is more important than ever.

This has created a focus on more than just products and locations, which is one of the reasons Customer Experience has become such a hot topic.

There are a lot of brands doing a phenomenal job at customer experience, but Sephora is always one of the first to be mentioned. It has created a deep brand with its customers and embraced technology that makes the user experience seamless.

Another element that Sephora does well to enhance customer experience is to have a loyalty program that stands out from its competition.

Loyalty programs are an important part of customer experience, but for some reason, they have been largely left behind. As companies invest in their CX, many of them still rely on traditional loyalty programs that look just like everyone else’s.

 

A New Loyalty Playbook

Loyalty programs are more important than ever in a world of unlimited choices. You need every way you can to acquire and then retain your customers.

Points are great and customers still like earning them, but nothing beats instant. We’re an instant world. More loyalty programs should be responding to this trend. This is just one example, but there are many ways to modernize your loyalty program beyond earn and burn.

Look at Restoration Hardware. Despite a lot of skeptics, it launched its RH Members Program premium loyalty program, which gives members 25% off every purchase for $100 per year.

When it launched this program, a lot of people didn’t think it would work. Not only was RH launching a higher priced premium loyalty program, but it also was killing off promotions.

Now, 95% of Restoration Hardware’s business is driven by RH Members Program members. Many free loyalty programs don’t even have that type of penetration.

Restoration Hardware took a bold stance with its loyalty program, but that’s what’s needed today. Your loyalty program should be a key differentiator as part of your CX.

Loyalty is not the only important part, but it should not be ignored.

 

In the Age of Unlimited Choice, You Have to Work Harder to Keep Customers

No one will argue that the world of retail has changed, yet loyalty programs have not seen the same level of disruption.

When your customers have unlimited choice, keeping the ones you have is critical.

As your competition improves customer experience, consumer expectations increase accordingly across the board. This is the same thing we’re going to see happen with loyalty.

As companies begin to respond to modern buyers’ needs by improving loyalty programs, consumers will expect that from everyone else. Where will you be as that happens?

It’s always better to be a leader than a follower when dealing with customer expectations. It’s how you set yourself apart early on and keep customers coming back. In the age of unlimited choice, you have to do everything you can to make sure you are the top choice for your customers.

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