THE CLARUS Blog

Why Your Loyalty Program Needs to be Unique for Your Customers

Differentiation is the name of the game in today’s retail loyalty world.

If your loyalty program is a run-of-the-mill offering that fails to engage, entice, or personalize, then it might be time to consider a change.

To truly differentiate your loyalty program, you have to listen to your customers, identify their pain points and learn what makes them unique.

 

One-Size-Fits-All Loyalty Programs Don’t Create Loyalty

In the Age of the Customer, traditional loyalty programs don’t create the unique qualities required to build brand advocacy.

Consumers still demand rational benefits like discounts and free shipping, but they get excited about something because of their emotions.

Since consumers hold all the power today and can switch brands in the blink of an eye, loyalty programs should be designed with this in mind.

Transactional benefits like discounts and free shipping are still important.

According to the 2019 Premium Loyalty Study, 67% of consumers said that instant discounts that can used whenever you shop was a perk that would motive them to invest in a premium loyalty program.

But to elevate a loyalty program and a brand’s engagement levels, they need to be combined with experiential elements.

While transactional benefits are typically points-based and/or focused on discounts, experiential benefits can differentiate a loyalty program and attract more members in the long run.

It’s almost impossible to accomplish these loyalty objectives with a traditional, one-size-fits-all program.

 

Every Retailer and Audience Is Unique

Since every retailer and audience is unique, every loyalty program should be unique as well.

How do you make your program unique?

It begins and ends with listening to your customers. They will tell you what they want out of your program, and what it would take to retain them as members.

Members want exclusivity, a sense that they’re getting something not available to everyone. And this is a crucial aspect of building a unique loyalty program for your customers.

For example, Sephora’s Beauty Insider program provides members with many experiential benefits. Consumers who sign up receive access to things like the Beauty Insider Community and beauty classes without having to spend anything at all.

Members that spend $350 annually gain access to the VIB tier. That equates to free gifts and one makeover per year. Members who spend $1,000 annually are upgraded to Rouge status where they have access to a private hotline and exclusive events.

Restoration Hardware’s RH Members Program charges members a $100 annual fee in return for 25% savings on all full-priced items, an additional 20% savings on all sale items, concierge service to manage your orders, and early access to clearance events.

In the same loyalty study, 22% of consumers said that exclusive in-store experiences would motive them to join. 43% said exclusive deals would be a driving motivator.

Build those unique qualities in your loyalty program by listening to your customers.

 

Build a Program That Customers Value

Loyalty programs should support a brand’s value proposition and, more importantly, be built upon a foundation of customer expectations.

Find out what they want and need and develop strategies and tactics to enhance and evolve the program around those wants and needs.

Consumers demand experiences, not just products or compelling offers. An experience is something that can be truly unique to your brand’s loyalty program and add considerable value.

Design your loyalty program around your customers. This means talking to your customers frequently. It also means testing.

You can find out a lot from your customers, but to truly get a sense of what works, you need to constantly test and optimize.

Learn more about optimizing your loyalty program.

Many programs today don’t necessarily make customers feel more loyal. Emotional connections are the key to loyalty and bridge the gap between transactional and true loyalty.

Customers that sign up for a premium loyalty program (see Prime) want to receive special treatment. Prime gives members access to the best of Amazon.

Customer loyalty cannot be designed or implemented in a silo. It must be a company-wide mission and responsibility. It all starts with truly listening to your customers.

Build a program that is unique to your customers and their loyalty will follow.

 

A Unique Loyalty Program Attracts and Retains Members

Differentiation will make a loyalty program unique for your customers.

Every audience and retailer is unique and brand officials should be mindful of this and put the customer at the center of everything they do.

Listen to customers, identify their pain points, and build a program that will offer attractive benefits and value to them.

Use your customer insights to build a loyalty program that is unique to your audience.

One size certainly does not fit all, when it comes to having a successful and unique loyalty program.

Would you rather build a loyalty program just to check off that box? Or do you want a loyalty program that actually attracts and retains your best customers?

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