THE CLARUS Blog

Why Product/Market Fit is Critical to Your Loyalty Program

Product marketing is a concept that is widely talked about in the startup community. The basic idea behind product/market fit is understanding the market’s need and creating a product that fills that need.

While that seems self-explanatory, it’s easy to get an idea for a product and then not worry if there is an actual audience for that product.

Unfortunately, we see this happen with loyalty programs all too often.

Companies will build their loyalty programs starting with the “loyalty program” in mind instead of the needs of the market.

This leads to a sea of undifferentiated loyalty programs.

Your customers should be at the center of everything you do and every decision you make.

 

Start With Your Customers First

Your customers are unique. Your product is unique. Why shouldn’t your loyalty program be unique as well?

Before you begin thinking about what you want your loyalty program to look like, start by looking at your customers. What do they care about? What are their pain points?

It’s important that you go beyond demographics here.

Ask your customers what they value. Why do they shop with you? What prevents them from shopping more often? What makes your customers unique?

Remember, your customers aren’t just buying your product. They are buying a better version of themselves.

These kinds of questions help us think deeper about what our customers truly want.

 

Create a Program Unique to Your Customers

Once you better understand your customers’ values and pain points, you can start creating a loyalty program that is differentiated and squarely focused on them.

This isn’t to say that you shouldn’t have a points program (although, you shouldn’t add one by default either), but with today’s competitive market, it’s imperative that your program is unique.

Learn what loyalty fatigue is and how a value packed loyalty program can cure that.

A deep dive to find out what drives your customers will help you design a loyalty program like a product and achieve desired differentiation.

All these factors make your loyalty program harder to copy and provide more value to your customers.

In the end, this creates true loyalty.

 

Who’s Doing this Right?

Prime – Simply put, Prime is the best loyalty program of all time. There are many benefits to Prime (and Amazon continues to add more), but let’s go back to its roots.

Amazon catered to people who were shopping online, but its customers’ main pain point was shipping time. This program solved that problem for those users and the highly successful Prime program is one of the key factors in Amazon’s tremendous success.

Nike Plus – Nike is all about athletes and its loyalty program is no exception. You’ll see standard loyalty program elements like free shipping, but there are several unique elements as well.

One of the program’s most attractive offerings is experts on demand. These experts will give you recommendations of products, but they will also give you recommendations on training as well.

MyWay by Wayfair – One of the biggest pain points around buying furniture is delivery and assembly. We’ve all been in the situation where we buy furniture and then need to assemble it yourself. It’s never an easy process.

Wayfair makes this more affordable with its program and even gives discounts on home design services as well.

Domino’s Pizza Rewards – Domino’s program is unique. What is the one thing all Domino’s customers have in common? They love pizza. With the Domino’s Pizza Rewards app, anyone can use their phone to take a picture of their pizza and earn points toward a free Domino’s pizza.

This may not sound unique on the surface, but its app lets you accrue points for scanning any pizza, regardless if it’s from Domino’s or not. While this is still a transactional benefit, it’s just plain fun.

 

Being Unique is no Longer Optional

There are several examples out there of loyalty programs that truly cater to their respective customers. These brands have listened to their customers to learn what their values and pain points are and created appealing and compelling programs around those insights.

As you consider your loyalty program, make sure you think of it as a product that provides value to your customers outside of just the transactional benefits.

Transactional benefits are still important and cannot be forgotten, but they won’t make your loyalty program unique and differentiated.

If you keep the focus on your customers, listen to them and address their pain points while offering enticing benefits, you will have a best-in-class loyalty program.

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