57% of Loyal Consumers Spend More on Brands

August 1, 2018 Jeffrey L. Cohen

Every brand wants to establish stronger connections with their customers. Real, emotional connections. But most customers are not interested. Many of the best customers may just view their relationship as one of commerce. The brand may offer the best price and that keeps a customer coming back, but they are not really invested in the brand.

How can brands discover which customers want to establish a stronger connection? The answer – like the answer to many marketing questions these days – is data. Let’s take this two steps further.

With the changing regulations around consumer data privacy, first-party data is becoming more valuable to brands than ever. This is the data that customers provide on websites, in mobile apps, and through purchases both online and off. This is a great start for identifying those ideal customers and targeting them with relevant offers to drive additional purchases.

But how do you identify the customers who will respond with deeper brand engagement?

Loyalty programs.

Have you seen those people who have a separate keychain with all their loyalty program cards? The average US household is enrolled in 19 to 29 different loyalty programs, but actively only uses 5 to 12 of them. The majority of consumers think of these programs primarily as a way of saving money. Each one of those cards provides retailers with a wealth of data about their customers. How often they shop. How much they spend. What products they buy. If they respond to special offers.

Loyalty programs in a digital environment provide this level of data across all customer touch points. The first – and arguably the most important – piece of data is provided when a customer joins a loyalty program. This can happen on the web, through a mobile app, or in a retail store. This customer is explicitly stating that they are more interested in the brand than other consumers. Maybe they are just looking for special offers and sale prices, but their activity data will reveal that over time.

An effective loyalty program creates personal experiences for customers to build an emotional connection with the brand to motivate their behavior. Not only does this create advocacy for the brand, but it ultimately drives revenue and profitability. According to Accenture, 57% of global consumers spend more money on brands to which they are loyal.

One way to drive a loyalty program is to challenge members to earn points by completing activities. This could be asking them to share a story of an interaction with the brand. For example a first pair a shoes, a favorite trip, or an exceptional experience with an employee. Social media, polls and surveys, enhancing their profile, and fun interactive games are other common ways to increase engagement.

As people earn points through their activities, brands can tap into their competitive spirit and a sense of accomplishment with leaderboards. Consumers can track their overall ranking among all members, as well as their status against their friends. Leaderboards can be used for challenges, challenge series, team competitions, or any specific metric important to the consumers and the brand.

What would earning points be without the ability to redeem them for exclusive digital and physical items, gift cards, and reward certificates? This is the chance for the most loyal fans to show off their feelings for a brand on their devices and out in the world. Connect with external coupons sites, use automatic redemptions, and even delight consumers with surprise rewards that may be awarded based on chance.

All of this activity is tracked and stored in a consumer profile within the loyalty platform. This provides marketers with detailed data on their most engaged customers, which can be used for targeted, personalized communication across email, SMS, and within mobile apps.

Brands can even create more dynamic experiences with augmented reality to engage consumers in physical locations. Use consumers’ mobile phones to bring to life physical products, marketing displays, and other images by triggering video and image overlays, special offers, and challenges.

Learn more about Stellar Loyalty now that it is part of Cheetah Digital and how consumer brands can redefine their customer engagement to increase revenue. 

About the Author

Jeffrey L. Cohen

Jeffrey L. Cohen is the director of content strategy at Cheetah Digital, where he creates entertaining and educational thought leadership content to grow the brand. He’s an award-winning marketer, strategist, and author (The B2B Social Media Book) with a 25-plus year marketing career.

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