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We’ve already discussed two of three Key Performance Indicators (KPI) of a Rewards Program – registrations and redemptions. Now we’ll wrap up with the final KPI – engagement. Let’s take a look at how to measure the level of engagement your rewards program engenders, why it’s important, and how to improve it. For the purposes of this blog, we’re going to define engagement as the frequency with which people are interacting with your brand. I’ll provide some data gathered from analysis of our clients’ programs and communications over the past year to use as a benchmark.
One of the most impactful ways members will interact with your brand is through your program website, and you want to keep them coming there as often as possible to use their points. On average, 20% – 30% of your registered population should be visiting your site on a monthly basis. Intertwined with this number is the amount of time visitors spend on your program website. The more time spent, the stronger the brand association that’s forged. And that’s of particular importance for a rewards program since it functions as a retention tool. A healthy KPI average is 10 – 15 minutes per visit.
To achieve the stickiness that draws visitors in and keeps them engaged, you need relevant content that changes frequently and offers excitement. Competition is one of the best ways to accomplish this. To borrow from my blog on competition, a competitive offering should be fresh, varied and include an element of surprise to give members a reason to keep coming back.
One of the best and most widely used tools to achieve this is with a Daily Deal that’s new every day at a specified time and in limited supply. This not only encourages a routine but also a sense of urgency that can convert a member from a casual visitor to a habitual one.
While the more traditional reward offerings like merchandise and travel will always carry a lot of weight, it’s important to note that these types of gamified elements should be actively engaging 15-25% percent of your enrolled population each month. Without them, you risk disengaging roughly a quarter of your member base.
To avoid this, and to ensure your engagement modules are working to maximum effect, you should closely monitor the specific interactions each of your engagement features produces. For instance, for each of our sweepstakes, we measure the amount of sweepstakes entries and the number of unique sweepstakes entrants. Similarly, we analyze the number of unique bidders and the unique bids placed in our program auctions.
We then use that data to determine the most engaging types of prizes to offer and the best times to offer them. This ensures that we keep the most in demand items in play so that we maximize interest and participation and keep members captivated. This constant demand for desirable items will drive members to use their program currency, which will then drive them to perform the behaviors that earn them more currency, which will complete the loyalty loop.
A great indicator of the willingness of customers to interact with your brand is their response to your communications.
Likely the most important medium you’ll use is email, so let’s look at some email marketing metrics, in particular unsubscribe, open and click through rates. If your email marketing efforts are setting off a high level of unsubscribes, or even worse, spam complaints, it’s a clear signal that the people on your list are unreceptive to your messages and unwilling to engage with your brand.
Your communications are the pathways to your rewards platform and a lack of engagement at this stage could be very harmful to your program and greatly diminish your chances of success. If unsubscribes are greater than .03%, first make sure your distribution list is up to date and there are no old, abandoned email addresses skewing your results.
Then examine your content to ensure that you’re serving relevant offers to those who have opted in. Open rates and click through rates will help paint a picture of exactly how relevant your communications are. Open rates should generally be in the 24% – 27% range and click through rates (click-to-delivered) should be in the 8%-10% range. To improve these, devise a testing strategy to find the most effective subject lines, content and layouts to help move people over to your site to redeem their points.
There are many factors that affect and define success in your rewards program and there are many ways to measure them. Benchmarks are helpful to compare your progress against industry standards, but at the end of the day, the best method is to record your own data and constantly test to refine your strategy and find what works best for your particular audience. There may be tried and true techniques, but loyalty will never be a one size fits all solution.
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