e strategies
Beyond Coupons: Mobilizing Mobile Shoppers
Mobile loyalty helps solve traditional loyalty program problems. Bryon Morrison
there’s more to mobile loyalty than simply offering coupons. Although there’s no doubt that these programs are on the
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rise (1.8 billion loyalty program memberships and rising), according to a recent Chief Marketing Council survey, 32% of respondents felt that participation in such programs held “little to no value.” Ouch. Companies have heard this, and they’re responding.
Retailers are finding more creative ways to tap into customer loyalty and satiate the consumer’s immediate need for reward distribution. In this era of instant gratification, brands are finding easier ways to overcome the traditional problems associated with loyalty programs. So while both digital rewards and mobile loyalty certainly
complement each other, in what way (other than the obvious locale-oriented benefits and real-time couponing) does the mobile device solve traditional loyalty problems? What follows is a look at loyalty programs, the digital
reward revolution, and a strategic way in which mobile loyalty helps overcome traditional hurdles.
98 Specialty Retail Report n Winter 2012
or retailers, mobile technology is providing new strategic opportunities to overcome problems associated with traditional loyalty programs—but
Loyalty, a proven tradition Over the years, loyalty programs have provided a way to establish reciprocity between the retailer and its customer. While there are countless variations on the theme, typical reward programs provide incentives designed to drive repeat purchases in order to gain loyalty rewards. In return, the retailer collects valuable customer data, which can be used to:
• Profile and segment customers • Study buying patterns, and • Open other marketing channels to the loyal customer
(direct mail, exclusive deals and shopping events, etc.) Such valuable information in return for relatively
inexpensive rewards has provided companies with opportunities to exponentially increase their return on investment in marketing programs, but not without problems. Critics contend that loyalty programs cater to customers who are already loyal—that incremental spending does not occur by catering to customers who are already consistently purchasing the company’s product—thus, any costs incurred in the loyalty program are lost by discounting to an established client base. Another traditional hurdle, and the primary reason for
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