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The cost of neglecting loyalty


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customer value and the profitability of your loyalty programme. Of course, a successful scheme requires


more than simply making customers “feel good”. So how can you ensure your programme will have emotional appeal and commercial benefit? Here are three essential things to consider.


1. MAKE IT PERSONAL Imagine you’d spoken to a friend about something quite important, but when you brought it up later, they asked you to explain it all over again, as if they hadn’t been listening at all. You wouldn’t feel particularly cared-for in this situation; in fact, you’d probably feel a bit let down. In the same way, your customers shouldn’t


earning threshold), and once “loyal” customers are lured away. Some retailers respond by supplementing their programmes with offers that can be redeemed any time, regardless of the member’s points balance – offers which typically come in the form of more discounts. This is just as damaging as typical retention


efforts that send about-to-lapse customers a money-off voucher. Not only do these discount-focused programmes encourage unprofitable behaviours, they also fail to create emotional connections between brand and customer. And these connections are essential to breeding long-term loyalty.


CREATING A PROFITABLE LOYALTY PROGRAMME If “creating emotional connections” sounds like marketing fluff, consider this: research from the Harvard Business Review found that emotionally invested customers are 52% more valuable than customers who are simply satisfied. Engaging customers on an emotional level, then, has significant potential for increasing


feel like they’re starting over every time they engage with your business. Recognising, remembering and personalising each interaction makes customers feel valued and cared for – helping to create an emotional connection. This applies across all customer interactions,


but it’s particularly essential for an effective loyalty scheme. Loyalty members, even more than the average customer, expect to be recognised and appreciated for their continued commitment to the brand. Recommending relevant rewards based


on a member’s interests, acknowledging their loyalty membership in marketing communications, even thanking them for their loyalty at the till – it all creates the sense that their relationship with your business is valued. And that creates emotions that inspire long- term loyalty.


2. ADD VALUE TO THE RELATIONSHIP One of the best ways to get value from your loyalty programme is to add value for your members. Not only does this make loyal shoppers feel appreciated, it also motivates them to engage with the programme and earn the rewards. Valuable rewards don’t have to be expensive


for your business. “Soft” benefits, which are often included in programme membership,


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