Reimagining Customer Loyalty

Ask not what your loyal customers can do for you, but what you can do for your loyal customers.

The difference may seem on first glance to be purely rhetorical, but if one examines further the impact that top spending customers have on businesses, the importance of letting the customer know they are valued is extremely clear.

Customer Loyalty Systems

Loyalty systems have been traditionally framed around rewarding customers for being loyal to a business. They are semi progressive loyalty systems in which the spend to reward ratio is always directly proportional irrespective of customer life cycle or previous spending history. Electronic systems offer business some respite in that they can e-mail customers congruent on their spending history to offer appropriate rewards, but paper stamp cards are different. They offer no feasibility for businesses to illustrate they are loyal to their customers; they’re entirely a one way relationship where customers are expected to demonstrate their loyalty with generic and impersonal reciprocation.

Modern customers demand more, and they are getting what they want not simply because they demand it, but because it is clear that when a customer feels appropriately rewarded, they are far less inclined to take their business elsewhere. Modern technology, more specifically apps, are helping businesses frame their rewards structure so that long standing customers recognise that their custom is highly appreciated, thus creating a bond that has hitherto been inaccessible for businesses of all sizes.

Loyalty Tiers

One innovation which has proved popular with large loyalty systems is ‘Loyalty Tiers’. This is the ability for businesses to recognise swiftly that certain customers have been longstanding and valued customers, and thus can attain higher levels of reward faster than new customers just joining the loyalty system. This has been one of the central drivers of growth of the highly successful Starbuck loyalty app, and has been modified by LoyLap to be offered as a free add on to businesses so they can truly illustrate their recognition of their most valued customers.

Surprise and delight systems are one of the greatest value adds to loyalty systems. This facility enables businesses to surprise customers based on spending, demographic, location etc, with rewards on a random basis. The surprise factor significantly improves brand recognition and affiliation. A café using LoyLap utilised this functionality in December to send a push notification to all their customers informing them they received a free coffee as a little Christmas present. This led to considerable thanks and appreciation in store, as well as a 14% rise in usage since the event.

Demonstrating Loyalty

With modern technology there is little reason for small businesses to act more impersonally than the larger chains they are destined to compete with. It is impossible for a successful café to personally recognise each customer individually, but the technology is now available to put them on the same playing field as larger chains when it comes to demonstrating loyalty back to customers. For it would be a true shame if a customer were to feel that have a more personable relationship with a multi-billion euro company than they do their local coffee shop.