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Azim Esmail, founder and CEO of RewardOps, believes that to effectively drive customer loyalty, brands need to collect, analyze, and act on massive data sets using a variety methods and sources. Automation, in particular, has made it possible to accomplish this more effectively and efficiently, resulting in some exciting changes to the customer loyalty landscape.
Loyalty360 talked to Esmail about how automation is changing customer loyalty.
How automation is changing loyalty and what trends do you foresee in this area?
Esmail: We have seen a surge of new platforms and programs enter the industry. The first wave of this started a decade ago with the introduction of gamification, which has marketing automation deeply rooted within. This momentum paved the way for new turnkey loyalty platforms that are catered to small- and medium-sized businesses and have automation weaved within their DNA. The result has been a spike of new customer loyalty initiatives from brands that have previously sidestepped the industry due to the associated complexity and costs.
While these changes have made it much easier for new industry entrants, it’s not all doom and gloom for incumbents. Automation has opened the door for brands currently executing loyalty initiatives to deliver a better member experience while decreasing their operating costs.
Future trends will revolve around automating the process of deep learning and personalization of customer experiences. Most program managers would love to take a few more steps in this direction but are limited by the capabilities of their technology platform. Data collection capabilities are restricting in-depth segmentation, custom content availability is limiting the number of unique experiences a brand can deliver, and antiquated rules engines make administration an operational nightmare.
I expect that to change in the next few years, with new and existing platforms rolling out technology that offers robust automation capabilities across the customer engagement spectrum.
How are brands using automation today to impact customer loyalty?
Esmail: Today, most brands with current loyalty initiatives are implementing automation to improve operational efficiency, thereby reducing costs. Focusing on cost savings is logical, and often necessary, to quickly realize a positive ROI on the upfront investment of implementing automation tools. As returns on this approach begin to diminish, I expect (and hope) that brands start turning their attention towards leveraging automation to learn more about their customers and use that data to offer them a truly unique experience.
No two customers should have the same experience with a brand. While that seems like a lofty goal, there are a handful of companies that are already there. In the years to come, automation will make the achievable by all brands.
What are brands doing well in this regard and where do the challenges lie?
Esmail: E-commerce has led the way in many aspects, with Amazon serving as the epitome of automation. From your first visit to receiving an order, Amazon is great at pinpointing every opportunity to streamline operations and taking advantage of them. Much of this automation would have been hard to achieve without a massive investment into proprietary technology, which poses a significant challenge to everyone else trying to reach similar levels. Collectively, our best hope lies in the hands of third-party technology companies developing specialized software to help move the needle.
The primary challenge we see is getting organizational buy-in that automation is worth the investment. Driving this change forward will require executives that understand the opportunity automation provides to champion it internally and be a force for change.
Do you think the definition of customer loyalty is changing today, given the plethora of options, consumer expectations, and technological access?
Esmail: The definition of customer loyalty may not be changing, but customers’ expectations are. As such, how brands gain, retain, and measure that loyalty should be an ever-moving target. We’ve already discussed how automation has resulted in many new entrants into the industry, along with enabling existing brands to do more. The result has been widespread marketing fatigue.
The days of blasting each customer with the same message are over. Customers have evolved and are magnificent at filtering out the noise, not to mention easily recognizing when a brand is not being authentic. Companies need to personalize and tailor their messaging and user experiences based on the unique traits of customers and where they are in their engagement lifecycles.
How important is automation to customer loyalty in general?
Esmail: For an industry that’s driven off collecting and analyzing data at nearly insurmountable levels, it’s table stakes. Companies that aren’t investing in automation now will be left behind.
Beyond remaining competitive, there is much more at stake for the industry as a whole. The promise of automation is to make everyday tasks quicker and easier. As brands realize these resource savings, they will have the opportunity to innovate in ways that previously were unachievable and unimaginable. That innovation is fundamental to the growth and evolution customer loyalty.
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