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There is no doubting the significant impact of loyalty marketing in recent history. With the continued emergence of technology and access to information, many loyalty programs have revolutionized the way consumers interact with companies and how much they spend. Currently, 65% of marketers have implemented loyalty programs and have enrolled over 2.1 billion memberships in the United States. These programs are distributing an estimated $48 billion per year in points and rewards. All of this is done in an effort to increase sales, improve customer loyalty, and boost a company’s bottom line. Retailers, airlines, grocery stores, convenience stores, and drug stores are all getting into the game – and many are finding success. Panera Bread and Kroger attribute a significant part of their recent growth to their loyalty programs. Walgreens, in a recent quarterly release, expressed confidence that their new loyalty program would positively impact their earnings in the next few quarters.
While many have found a recipe for success, many marketers are overwhelmed and don’t know where to start. As a result, they push forward with a ‘let’s just get something out the door’ mentality, not realizing the damage it’s doing to their customer experience. The foundation for deploying a successful program lies within the proper integration and analysis of data.
To better understand the impact of data management on loyalty program performance, Altair Customer Intelligence and Loyalty 360 conducted research into companies with and without loyalty programs and focused on the aspects of data management and key performance indicators. Additional information was gathered on prospecting, channel preference and predictive modeling.
Through in-depth surveys with over 100 marketers in North America, Altair found that as companies evolved their data management process to include analytics, reporting and predictive modeling, the more aware they became of short-comings in each area. The survey also revealed that companies face the same challenges regardless of the presence of a loyalty program. However, those with loyalty programs reported a higher overall performance, signifying that a focus on loyalty makes organizations more aware of the nuances of data and the power of prediction.
Companies can achieve higher performing loyalty programs and boost their branding efforts when proper data management techniques bring together untapped internal and external data sources, thus monetizing what has traditionally been a cost center. Bringing together these sources allows for enhanced analytics, better model development and more robust reporting; providing you with the necessary tools to ensure you’re hitting the right customer with the right message through the right channel at the right time. As a result, this will maximize marketing dollars, promote a positive brand image, induce continued loyalty, attract future customers, and certify that your efforts are achieving the desired result.