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As the loyalty landscape continues to mature, many brands have started assessing their program structure and making changes accordingly. For example, we recently worked with The Vitamin Shoppe to redesign the Healthy Awards program with a renewed focus on meaningful, human interactions. While change is not uncommon, your active members are likely to be the most sensitive and vocal. Before making any major decisions, it’s critical to take a hard look at your program from your customers’ point of view to understand their behavior—what elements they’ve grown to love and what they might be able to live without.
True loyalty is the outcome of a two-way relationship, and like any relationship, communication is key. During your communication planning process, account for these four straightforward (but fundamental) strategies to ensure a successful program transition:
Members want transparency and simplicity from their loyalty programs. Consider using teaser communications to plant the seed that changes are coming, but don’t overuse them. Rather, communicate changes clearly and consistently throughout the transition to help mitigate negative consumer perception. By leveraging your current communications channels, you can reach your members with the right information at the right time.
As you plan to inform your members, don’t forget another key audience that needs information: your employees. Ensure your new loyalty program is set up for success by taking adequate time to train your employees. It’s especially important for frontline employees such as sales associates and call center representatives to be armed with FAQs and rationale, so they can reinforce your marketing messaging and be prepared to answer questions.
Early engagement is key to helping members feel at ease and excited about the new program. Develop an early launch education series to demonstrate to your members that your new (and hopefully, enhanced) program embodies their best interests. And while a special, limited-time offer might be your hero message, be consistent with your core value proposition. Educate members about the benefits, earn structure, rewards, and extras. Don’t assume your members caught everything the first time.
How well do you know your customers? By identifying and proactively reaching out to your high-value members separately, you can make them feel appreciated before, during, and after the transition.
High-value members can include top spenders, frequent buyers, influencers on social media, and those who provide positive product or service reviews. Acknowledge your VIPs and reassure them with the specific benefits, rewards, or experiences to get them engaging with the new program. High-value members rely on your brand to buy their favorite products or services. Show them you care and that they aren’t just another number.
The changes to your loyalty program shouldn’t just be a restructure for the sake of your P&L statement, but also solve for customer pain points. More brands are diversifying their rewards offerings by seeking out partnerships and experiences that will further engage members. People can buy only so much, so consider rewarding them in alternative ways that may surprise and delight them. According to Colloquy, 50 percent of loyalty program members participate more actively in programs that offer a variety of ways to earn.
Before you press the restart button on your loyalty program, establish a plan to inform, educate, reassure, and reward your members and employees. According to Forrester, it costs five times more to acquire new customers than to retain existing customer relationships. Losing loyal members during a program change is an extremely costly—yet avoidable—outcome. And when you truly deliver on your brand’s promises and values, especially during times of change, you can build trust instead of breaking it.
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