December 7, 2011 - Marketers are at
a very critical
juncture. According to Loyalty
360 – The Loyalty Marketer’s Association, customer loyalty,
versus
acquisition, is critical for
driving sustainable growth. Yet,
businesses report
that retaining and engaging customers remains one of their
greatest challenges.
To help marketers develop more effective loyalty strategies, Loyalty
360 suggests they take a deeper dive into the following customer
loyalty
trends:
1. Customer engagement is the journey, loyalty is
the destination. Loyalty is a much bigger, broader,
richer
and growing ever more complex idea than it has been in the past.
Loyalty
is no longer about points, discounts, miles, rewards; it
is about the
way the processes, technologies, ideas, interactions engage
an individual
with the brand. The only way to achieve loyalty is through
deeper engagement.
2. There will be a renewed (and well-needed) focus
on customer retention and loyalty vs. customer acquisition.
Customer
loyalty has been identified as the top non-financial business
challenge
facing companies in 2012 (Protiviti). While daily deals like
Groupon,
LivingSocial are generating lots of buzz, marketers are realizing
that
these price-based technologies have taken their focus away from
the real
prize: customer loyalty.
3. Brands need to recognize customers at
all touchpoints,
especially the call center, to deliver a quality customer experience. A
recent poll by Loyalty 360 found that 78% of respondents believe that
having a great customer experience makes them loyal. Creating
this
type of customer experience involves delivering quality customer
service
across all touchpoints, and marketers are realizing that this
means integrating the call center into the overall customer
experience.
4. Marketers will work to glean intelligence from
social media feedback. The vast majority of
real-time
data created today is unstructured data. Study after
study is
showing that marketers are struggling with mining this
data and
analyzing it in order to derive valuable insights and actionable
intelligence from it. In fact, a just-released report
by EMC found
that only 38% of business intelligence analysts and data
scientists
strongly agree that their company uses data to learn more
about
customers.
5. Loyalty program is seen as critical element
of “life
cycle management.” Engagement with customers over a
lifecycle is
the new model for success. The only way to earn
loyalty is
through deeper customer engagement and data gathered from loyalty
programs can be used effectively to drive a quality experience
across all
touch points and at all stages of the customer lifecycle.
6. Marketers will look at a mix
of location-based behavioral
data and attitudinal and preference data. This trend
will have
an especially important impact on the daily deal space. Brands
will want
to have this data and control the message rather than
offering such
huge discounts to anonymous individuals.
7. Mobile coupons will go mainstream. Juniper
Research forecasts that the total redemption value of mobile
coupons
worldwide will be more than $43 billion by 2016, representing
an eightfold
increase from $5.4 billion this year. Cost effective mobile coupon
campaigns provide merchants with an easy way to build customer
loyalty.
8. We will see a focus on social media ROI. While
marketers believe that social media is worthwhile, most don’t
know how
worthwhile it is. As marketers become more sophisticated and
skilled at
navigating the social media channel, they will be more demanding
of tools
that track and improve ROI. In fact, the 2011
IBM Global CMO Study
found that 63% of CMOs believe ROI on marketing spend will be
the
most important measure of their success by 2015. However, only 44%
feel
fully prepared to be held accountable for marketing ROI.
9. Brands will increasingly use the
rich information
about customer buying patterns generated via loyalty programs to
create
more targeted marketing/messaging. Gathering and
tracking data amassed in the loyalty program will be used to help
marketers with segmentation, messaging, for acquisition and
retention. The information on customer transactions,
likes,
dislikes and preferences gives brands the deep level of customer
intelligence needed to deliver the most relevant,
highest quality customer experience and drive long-term
loyalty.
10. Social personalization will increase. Marketers
will
harness the power of recommendations and referrals to persuade
customers
and prospects to follow their friends' leads. They
will become more proactive in encouraging reviews,
implementing
refer-a-friend programs, etc.
11. Mobile digital wallets will mark a big shift in
retail
payments. With the value of transactions made over
mobile
devices estimated to be $240 billion this
year (Juniper Research) and
predicted to triple that size over the next five years, it’s not
surprising that the battle over mobile wallets will continue
to
intensify. And with analysts at Forrester predicting
that by
2016 consumers may be able to leave their traditional leather
wallet at
home and pay for most of their shopping over their
handset, retailers need
to think about the impact of mobile wallets as they build out
their
loyalty programs.
12. Worthy causes will continue to influence
consumer brand
loyalty. A study from Cone Communications found
that
consumers are more likely to pick a brand based on charities or
causes it
supports. A full 94% of responding consumers said they would
abandon their
typical brand for one of approximately equal quality and price if
it backed a social issue.
About
Loyalty 360
An unbiased, market driven, voice-of-the-customer
focused clearinghouse
and think-tank, Loyalty 360 is committed to bringing
customer loyalty
to the forefront as a critical marketing strategy. A
trusted
source for cutting-edge research, best practices, and networking
opportunities, Loyalty 360 gives members the expert insights and
guidance
they need to better understand loyalty and develop programs
that
effectively engage their customers and employees and build
stronger
relationships with them. www.loyalty360.org.
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