Vivian Que-Azcona, President of Mercury Drug Corporation and NCR Director of the Philippine Retailers Association, was once asked: Are loyalty programs really making consumers more loyal or do they just counter those offered by others?
Her response: “Loyalty programs are effective in keeping loyal customers as they receive exclusive benefits and promotions. However, it’s not enough to just provide loyalty programs without doing a research about customers. The retailer must take a look at consumer data and trends, especially their shopping habits, so that their needs can be met and delivered. By doing so, the loyalty program can continuously delight regular customers and assure their loyalty.”
This seems obvious and still, many consumers find loyalty points irrelevant. Sure, they avail membership to earn points but customers do not actually reap benefits, see the value, or derive satisfaction from these loyalty programs. In fact, ask yourself: how many loyalty cards have you piled up over the years and how many of them do you use? Do you even know how to maximize the benefits? Did these cards increase your loyalty at all? Certainly, the answer “yes” can be applied to only 10% of those cards.
In turn, businesses lose significant opportunities to boost up sales and eventually never get the real Return-On-Investment (ROI) from implementing a loyalty program — the value of knowing MORE about your customers.
And perhaps that is it — most businesses develop loyalty programs that do not fully connect with customers’ needs and wants. Instead of focusing on how to “counter those offered by others”, building program specifics (i.e. mechanics, technology, tools, design, benefits) must be aligned to customer-centric objectives. This way, you go BEYOND points and finally get to “assure” customer loyalty.
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