Is Big Data Actually Driving Loyalty?

We run our lives online, through our smartphones, anywhere we need to be and at all hours. Constant connection to the internet is so ingrained in daily life in North America it’s no longer a talking point, it’s the norm. This technology has made communication, way-finding, shopping, and information search quicker, lighter and more convenient.

Consumers expect that loyalty programs and branded currency programs will keep pace with technological advancements and adapt to the way we’ve become accustomed to spending. But there’s a give and take when it comes to data collection for an online customer loyalty program. The more information a customer is willing to share, the more personalized a shopping experience or incentive offer can be, but this requires personal data that a customer must consent to sharing.

Data is critical. More merchants need to start using it.

“Data is critical. More merchants need to start using it,” says Kristen Thiry, co-founder of K+H Connection. “But there is sensitivity and some timidness from some merchants because of regulatory concerns.”

But even a vague idea of who is purchasing products or services can help businesses better serve their customers. “There is a way that merchants can get important customer demographic information without being so specific with names and address,” says Thiry. “You know I’m a mid 30s female who likes to shop at these brands. That’s powerful, and you can do a lot with it. That’s what’s going to help move this industry forward. That’s the holy grail.”

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You know I’m a mid 30s female who likes to shop at these brands. That’s powerful, and you can do a lot with it. That’s what’s going to help move this industry forward. That’s the holy grail.

Thiry and her partner at K+H Connection, Holly Glowaty know technology is a hot topic in the payment technology and customer loyalty industries. At their annual Flourish Conference, they gather experts on technology, consumer loyalty programs, and other branded currency issues to share the latest in tools and opportunities.

Before customers are willing to sign up for savings and incentives, they must trust the brand they’re providing with their personal details and see value in the exchange.

“When you make it about customer experience, that’s when a customer is more willing to give more information,” says Glowaty. “I willingly give some brands so much information because I love paying with my phone, it’s easy. The way they reward everybody makes sense. They use their data wisely. When you build a seamless customer experience on top of it, that’s what makes it worthwhile.”

 

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Customer retention is an important part of any sales and marketing strategy. Using data tools and metrics, brands can focus on building meaningful relationships with the right customers. Keeping existing customers happy and providing incentives for them to shop repeatedly with a brand is easier than recruiting new clientele.

Communicating through technology also makes it much easier for a brand to stay top of mind with a consumer. By connecting an email address to a loyalty card, a brand can send updates alerting customers to sales and new products. With an in-depth understanding of customer demographics, brands can send curated incentives they know will be of interest, increasing their chances of catching a customer’s eye.

Using data tools and metrics, brands can focus on building meaningful relationships with the right customers.

Data driven loyalty programs specialize in customer experience. If they’re engaged with the loyalty program, we know a customer is interested in a relationship with the brand. Once data has been provided, brands can extend targeted value and engage with consumers who have pre-paid currency or rewards already in their hands, or their electronic wallet. Gathering data is essentially market research allowing a business to better respond to their customers based on their spending or redemption behavior.

“The customer engagement piece is huge so making sure you’re capturing as much information about the customer as you can, without opening yourself to regulatory scrutiny, is the key.” continues Thiry. “Going forward that’s going to be really critical if you’re able to target those customers who have value to spend at your store. They have that branded currency in their possession and really targeting them to come into your store and giving them a special experience can keep them engaged.”

“Marrying the technology with the product and the data depends on your use case. Changing behavior is the hardest part of the whole thing,” adds Glowaty. “A digital and physical gift card really can have separate applications and grow one portion of the business without having the same strategy behind these two products. That’s where a lot of opportunity lies, understanding how people use them in their different forms.”

Marrying the technology with the product and the data depends on your use case. Changing behavior is the hardest part of the whole thing.

“There are plenty of retailers who still are only using one or the other, branded currency or a loyalty program,” she adds. “Some people are still using punch cards!”

Loyalty programs and branded currency are becoming popular marketing tools but asking consumers to carry around another card is a tough sell. Apps like Gyft allow gift cards to be uploaded into an electronic wallet on your smartphone to allow easy access at any time. Keyring does the same for loyalty cards, at no extra weight. Giving consumers online quick access to their pre-paid currency makes using it easier. If a brand doesn’t have a dedicated app, there are many platforms encouraging consumers to store their loyalty cards in their smartphone, ensuring they, and the relationship, aren’t lost.

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“New loyalty comes back to customer data and making sure you’re giving that customer reasons to come in and spend some time with you and engage with your brand,” confirms Thiry.

She says using data to target particular consumer groups and offer a unique experience will build trust and give your customers comfort in sharing more data with you as your program evolves. “Gather information, encourage customers to engage online with your branded currency to an extent that you can gather details and data to allow you to have those integrated conversation with them.”

Thiry knows that data collection and the questions around it will form the future of branded currency and loyalty programs.

“When we have those lines of sight and the visibility into who those customers are, their behaviors and what some of those common denominators are, then we can make better marketing decisions, better branding decisions, and design decisions. We can put together better promotions and targeting. That’s what’s going to help us sustain long-term in this industry.”

The Future of Branded Currency is in the Customer Experience

Retaining customers and developing an emotional connection to your brand is essential. We talk with Kristen Thiry and Holly Glowaty about the many brands cashing in on customer loyalty to encourage spend on branded currency. 

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