THE CLARUS Blog

7 Reasons Why You Should Partner With a Premium Loyalty Company

When it comes to loyalty programs, premium loyalty is a different animal.

There are a million loyalty vendors out there, but most of them have always focused on traditional, free programs.

But there are core competencies required to build, manage, and optimize a paid membership program that traditional loyalty vendors simply don’t have.

From billing to specialized customer service, here are 7 reasons why you should consider talking to a specialized partner like Clarus if you are thinking about a premium loyalty program.

 

1. Acquiring and Activating Paid Loyalty Customers is More Difficult

With a free program, all it takes is obtaining an email address and some basic information about a customer to get them enrolled. That’s not a big ask, so there is little barrier to entry in getting signups.

And there are lots of platforms out there to handle the collecting and redeeming of points once someone joins the program.

But, with premium loyalty, customers really must be sold on the program. They must get excited about the benefits. It’s on the retailer to do that.

And one key way to sell a premium loyalty program efficiently is through your store associates.

Read more about the in-store loyalty signup experience.

As a retailer, it’s critical for your in-store associates to get customers excited about signing up. It’s the associate, when given the proper training and tools, that will deliver the right information at the right time, resulting in the best outcome for the customer.

This creates an emotional connection.

 

Customer retention is hard in a paid loyalty program.

2. Customer Retention is Just as Hard

When a customer joins a free loyalty program, there’s really no downside to the customer to stay in the program other than having a lot of plastic loyalty cards laying around.

You must engage your members regularly and with relevant messaging. You want your members excited to receive any communications from your brand.

And of course, the benefits must be valuable. The transactional benefits like instant discounts, free shipping, and promotions make members feel smart, but experiential benefits are an integral piece of a premium loyalty program as well.

A premium loyalty program is an opportunity to differentiate from your competitors, so it’s important to offer experiences that members can’t get anywhere else.

Check out how Lululemon’s pilot premium loyalty program successfully combines transactional and experiential benefits.

When it comes time for renewal, you want your members to feel sufficiently motivated and happy.

A premium loyalty program’s benefits evolve over time. To keep members actively engaged and renewing memberships means that the program must be monitored and consistently optimized.

That’s why we always look at the data to see what’s working and where things can be improved.

We need to make sure members are receiving the right messaging, at the right cadence to ensure they are always aware of the great benefits.

Members of Amazon’s highly successful Prime premium loyalty program spend nearly twice as much as non-members.

Amazon optimizes its Prime benefits on a regular basis and keeps the program fresh and enticing.

The optimization piece is so important because if members aren’t getting value out of the program all the time, they aren’t going to renew.

Effective engagement, essentially, is retention.

 

3. Comfort with a Recurring Billing Subscription Model

Free loyalty programs obviously lack the billing element, but this experience is required with premium loyalty.

This isn’t just about systems, but know-how associated with the merchant process.

We build and market loyalty programs and that comprehensive company knowledge is invaluable to us and anyone we partner with.

We have the people, the platform, years of experience, and maintain all that information for our partners.

 

Premium loyalty companies are able to analyze customer data.

4. Lots of Data and What to do With It

There needs to be both quantitative and qualitative member data from a premium loyalty program.

As a marketer of a premium loyalty program, your eternal refrain is: Right message at the right place at the right time.

Some critical KPIs to consider are:

  • Conversion
  • Trial Stick Rate
  • Lifetime Value
  • Average Order Value
  • Frequency of Purchase
  • Gross Merchandise Value

If your premium loyalty program is missing the mark in any of these areas, then it’s time to re-evaluate. At the end of the day, that sweet spot is when both you and your customer are getting the most value out of the program.

Learn more about the premium loyalty KPIs you should monitor.

 

5. Keeping the Brand Experience Front and Center

A loyalty program is an extension of your brand and, in the case of a premium loyalty program that members are signing up and paying for, it’s imperative that members have a seamless experience across every touch point of the program.

While we obviously make sure we are using the logo and color palette consistently with the retailer’s main website, there are less obvious things to consider from a creative perspective.

Here are 5 essential loyalty branding tips.

For example, we might use lifestyle images with a vintage filter rather than super sharp modern looking images to match the main website.

Follow brand identity guidelines, make sure the online experience is seamless, ensure emails are consistent, and make sure the in-store experience is on-point.

 

6. Omnichannel Customer Communication Strategies

Loyalty moments occur when we have interactions with a brand that create a lasting impact and shape our future interactions.

Companies that focus on creating more loyalty moments with their customers will reap the benefits and greatly enhance their lifetime value.

A connected in-store experience, making interactions speedy, and making interactions personal are just a few of the key aspects of creating effective omnichannel customer communication.

Delivering memorable customer experiences will create loyalty moments that impact lifetime value.

Making the in-store customer experience a priority creates a point of differentiation and, along with it, loyalty moments.

When we talk about a seamless customer experience, speed is an integral piece of the loyalty puzzle. Given the abundance of choices for consumers, speed is vital in attracting and retaining customers.

Personalizing these experiences elevates customer engagement to the highest level.

 

Customer service is an important element of premium loyalty.

7. 24/7 Customer Service

With traditional loyalty programs, customer service doesn’t become an issue because the programs are free.

Customer service for a premium loyalty program is so important, compared to a free program.

Learn more about branded customer service.

For many retailers that work with a loyalty vendor, that vendor takes on customer service on behalf of the retailer as part of the service it offers. We call this branded customer service.

Essentially, the vendor becomes an extension of the brand and it’s all about bringing customer service to a new level.

It’s critical to reinforce the brand promise at every touch point. That’s what creates loyalty moments and makes for a seamless customer experience.

When Clarus partners with a new retail client, we assign specific customer service reps to that client exclusively. And then we train them intensely.

We tend not to use scripts (unless that is specified by our client). We like it to be more organic so that when a member calls, they don’t feel like they’re talking to a robot.

In the past 18 months, 90 percent of our customer service calls were answered in 30 seconds or less, with an average response time of 14 seconds.

These are your best customers in the program. They deserve the best possible customer service.

 

Effective Engagement Equals Retention

When you partner with Clarus, we execute on each of these seven key points. And we do all of it for no upfront cost.

Read more about our unique revenue share simple pricing model.

As stated previously, effective engagement is the linchpin of a successful premium loyalty program. And that engagement leads to customer retention.

We take the load off the shoulders of our partners by offering a great team that brings a very specialized set of skills to the table.

Don’t you want a team that specializes in premium loyalty to do the heavy lifting for you?

Are You Ready to Go Premium?

If you want to become a 24/7 presence in your best customers' lives, it's time to get started.