COMMON LOYALTY PROGRAM ISSUES
Your program is delivering incremental sales but it’s costing you too much. Solution: Determine the cost-cutting goal, review the entire program budget, determine the changes needed to allow for profits to flow through, implement those specific changes and measure results.
Your rewards program is not engaging customers as expected. They are not providing additional visits or spending. Solution: Look at messaging, audience demographics, and partnerships. This is where you need to get creative and provide both value and engagement tactics to get your customer to notice.
The program is doing OK, but can be providing more value. The issues here usually lie within operations. Solution: Review each operational area and find gaps between the ideal state and the current state. Prioritize them based on lost value and implement changes to add significant value to the program.
This issue often stems from the launch of a program and the fear that customers will not respond. But it is difficult to pull back once a value proposition is out there. Solution: First look to see if you can adjust the earning criteria, then look at redemption rules. Don’t be overly concerned with a few zealots who complain. Stick to the plan and communicate.
The best loyalty programs are founded on a high-quality customer segmentation schema. Low response and limited incremental lift is often due to incorrect segmentation. Solution: Review the segments and their demographic definitions. Test new segments with communications and offers to help lift performance.
Well-designed programs need continual monitoring to ensure incremental lift goals are being met, liability is controlled, and the program is delivering on the pro forma. Operating without these controls in place often cause programs to veer off course. Solution: Implement monitoring, analytics, and reporting to ensure the program stays on track.