We all want to see what the future holds, but predictions can be a challenge. While fortune tellers have crystal balls and psychics read tarot cards and palms, marketers’ predictive power is something more concrete: data.
Take this stat, for example: 77% of consumers participate in retail loyalty programs. So if you still don’t have a loyalty strategy and program in place, your future could be perilous. Consumers are telling brands this is what they want; it’s time to listen. Still not convinced? Let’s take a closer look at life without loyalty, but be warned: what you see may be shocking.
...you won’t provide value for your customers.
Many loyalty programs have integrations that provide real-time responses to customer activity, like delivering timely, relevant offers when a customer is near a store location. This kind of personalized engagement is highly valued by consumers. According to McKinsey & Company, communications that are relevant and useful can not only create lasting customer loyalty, but also drive revenue growth by 10-30%.
Without a loyalty program, customers receive static, generic mass emails that ignore their particular interests and preferences. Even worse? They don’t get a sense of who your brand is or how your products meet their individual needs.
...you will lose emotional connections with your customers.
There’s a reason it’s called a “loyalty” program and not a “points” program. You’re not just handing out points; you’re earning trust and building relationships. In a recent survey, 79% of consumers told Wunderman that brands “have to actually demonstrate that they understand and care” before customers will consider purchasing. Achieving this calls for a complex, dynamic mix of activities and interactions between your brand and customers to drive engagement at every possible touchpoint (i.e., a strong loyalty strategy).
Without a loyalty program, customers may not notice or even (gasp!) consciously ignore your attempts to communicate with them. But even worse than that, customers won’t have rewards, contests, or the next loyalty tier to get excited about — leaving your brand to blend in with all the other meaningless transactions in their lives.
...your customer experience will suffer.
That same Wunderman study found that 88% of U.S. consumers want to engage with brands that are setting new standards in meeting customer expectations and more than half feel more loyal to brands who understand their priorities and preferences.
Skip the loyalty program, and you won’t have the insights needed to provide tailored content to customers that grabs their attention and keeps them engaged and connected. To put it bluntly, your would-be relationship will be tarnished from the start.
...you will lose customers.
Customer retention is the ultimate goal of a loyalty program. That’s because increasing retention by just 5% can increase revenue by 25 to 95%. And don’t forget 10-30% in increased revenue that’s at stake.
Without the additional value for customers, engaging experiences, and emotional connections that loyalty programs provide, customers will take their business elsewhere.
Remember, these are visions of things that could happen. An effective loyalty program does require some complex strategizing, but it’s never too late to develop a loyalty program that gives your shoppers the personal touch they want and that drives continued engagement across all touchpoints.
If you’re ready to take your loyalty program to the next level, contact us. We're always happy to chat about how we can help you.
Cheetah Digital is a cross-channel customer engagement solution provider for the modern marketer. The Cheetah Digital Customer Engagement Suite enables marketers to drive revenue, build lasting customer relationships, and deliver a unique value exchange throughout the entire customer lifecycle. We are a business partner to the world’s best brands and have employees across 13 countries.