GLOBAL RETAILER AIMS HIGHER WITH CUSTOMER LOYALTY
BUILDING OMNICHANNEL INSIGHT, ENGAGEMENT, AND COMMERCIAL SUCCESS WITH A WORLD-CLASS LOYALTY PROGRAM
Our client, one of the world’s largest retailers, set out to find a partner that could serve as an extension to their marketing team to help them better understand, retain, and engage their customers. This partner would be critical for:
- Establishing a unique, customer-centric loyalty program
- Utilizing the loyalty program to develop and enhance customer engagement
- Applying customer insights for omnichannel and personalization capabilities
89 Degrees was selected based on our deep retail experience, proficiency in designing differentiated loyalty programs, and ability to provide the needed advanced marketing analytics.
To meet our client’s near and long-term goals, we executed 3 phase approach:
Phase 1 – Establish a powerful loyalty program
Phase 2 – Develop and enhance customer engagement
Phase 3 – Enable omnichannel capability and personalization
Build. Drive. Engage.
How do we make it more than just a reward system for high-spenders?
That was the question our client wrestled with when they first set out to develop a loyalty program. Our answer was to build a program around 4 key objectives:
- Offer a range of benefits for maximum appeal, including members-only discounts, random contest winners, price-protection, and other free or discounted in-store perks that enhance the shopping experience
- Build a customer database through multichannel program exposure and enrollment opportunities
- Drive data capture through increased member card usage and product offer consumption
- Engage customers with timely, targeted, and relevant emails that drive awareness and purchase
We rolled out a range of registration options – including in-store kiosks, point-of-sale (POS), online and mobile options, and a tablet app for sales associates walking the floor – to communicate program benefits and expedite member acquisition, all while minimizing the impact on store operations.
With the program and the means to capture customer-related data in place, 89 Degrees was able to start uncovering customer insights to better direct their member communications. First step was to complete a product affinity analysis on customer purchases to determine which product pairings had a high propensity for incremental sales and visits. This, along with specific business rules (e.g. available inventory, seasonal times), allowed for prioritized product recommendations to elevate campaign performance and drive more desired outcomes.
Develop And Enhance Customer Engagement
After a successful program roll-out, the emphasis moved to four key priorities:
1. Utilize customer data for the development and application of deeper customer insights
- RICH ATTRIBUTE DATA – Through profile data, purchase behavior, and communication responses, we were able to build a comprehensive customer data lake with over 50 attributes that could be used for campaign targeting, research, analysis, and other programs
- STRATEGIC SEGMENTS – Our team of data scientists used statistical approaches to identify patterns in the data, enabling strategic views of the customer, including RFM (recency, frequency, monetary), level of engagement, and lifestyle segments
2. Develop a high-performing email communication program, targeting customers with relevant content and offer
- OPTIMIZATION – Ongoing optimization efforts consistently improve targeting across email campaigns
- MEMBERSHIP LIFECYCLE TRIGGER EMAILS – From initial “welcome” communications detailing the benefits of the program, through anniversary and birthday treats, all the way to reactivation of lapsed customers, we focused on providing customers with targeted and timely information.
3. Implement a card to wallet solution for customers to associate a virtual membership card to their smartphone wallet. In addition to ensuring the customer never forgets their card, this also opened up the opportunity to direct message customers with mobile notifications.
4. Develop program elements to engage customers during purchase journeys
- RECOGNITION PROGRAM – While members had access to many ongoing benefits, including monthly product discounts, gift card giveaways, and birthday rewards, there were few program elements through which the brand actually expressed gratitude to a member for taking action. We addressed this by implementing a badge program that recognizes a member’s behavior or engagement by rewarding them with a digital badge and, with select badges, a coupon for an in-store treat or free product.
- GIFT REGISTRY – To launch a gift registry program, we needed to devise a way to work with their existing point-of-sale systems; we accomplished this by using card numbers as registry account numbers. This enabled capturing engagement with all gift registry registrants and their guests, as well as their shopping behaviors.
- MEMBER ENGAGEMENT (CO-CREATION) – As part of an annual competition for kids, we implemented a platform that could handle all submissions (content uploads), online voting, and social sharing requirements. Events of this nature help members see the loyalty program as more than a vehicle to obtain sales and engagement metrics, but also one that involves its members to encourage children of all ages to use their creativity.
ENABLE OMNICHANNEL CAPABILITY AND PERSONALIZATION
With the retail environment evolving rapidly, our ability to collect and harness customer data is proving invaluable as our client adapts to meet the new norms of omnichannel engagement and personalized customer experiences. Critical initiatives we are leading the way on include:
- GRANULAR MICRO-AUDIENCES – We are developing micro-audiences for better understanding and targeting for personalized communications
- DYNAMIC CUSTOMER JOURNEYS – Include automated triggers that come to life when customers abandon their online shopping carts or browsing, encouraging them to complete their purchase journey online or in store.
- OMNICHANNEL PRODUCT RECOMMENDATIONS – Driven by a best-in-class recommendation model based on past purchase history and online browsing, we are able to generate higher-performing recommendations and deliver across all forms of communication regardless of preferred platform, including collaborative agency partners.
- CUSTOMER-CENTRIC ORGANIZATIONAL ENGAGEMENT – Increasingly, as consumers demand more relevance and seamless experiences, we are finding new opportunities outside the marketing group to drive customer insights and targeting into other parts of the business, including sales, market intelligence, and operations, as well as sharing insights and audiences with 3rd party media partners.
The program is a win-win for all participants. The loyalty program has acquired millions of US members since launch, with the typical member having a lifetime value 6 times larger than non-members. While members enjoy additional savings and in-store perks, our client gains valuable insight into customer behavior and the ability to deliver more relevant offers and ongoing benefits. The result is a foundation of optimized customer engagement and higher KPI’s, including:
- 15% higher conversion rate for member email campaigns
- 36% open rates for triggered email campaigns
- 50% higher ROI when compared with paid media and other marketing tactics
- 30% higher than MMA industry benchmarks
- Strategic consulting
- Site information architecture, design, and copywriting
- Mobile design and development
- Advanced Analytics and reporting
- Front and back-end coding
- User experience design and deployment
- Database development
- Email campaign coding and deployment
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