Does it pay to build loyalty?

We are now transacting within a digital-first society. With an increasing number of ecommerce retailers and ease of access to international brands, consumers are no longer confined to a small number of local merchants. Customers have such strong buying power, and with the ability to swap to a competitor site with just one click it is becoming increasingly difficult for merchants to build brand loyalty.

Over the last ten years as online spending has increased, traditional in-store loyalty schemes and rewards have become less popular, as there is friction between the online and offline experience. Recent studies highlight that 61% of retailers site customer retention as their biggest challenge (Retail Systems Research) and most merchants are now pursuing an omni-channel retail experience to adapt to customer spending behaviour, however this also needs to include the wider loyalty offering.

After the last few challenging years, now more than ever, merchants need customers to stand by your business and redefining your loyalty program could be part of the solution.

Understanding why loyalty is limited

The retail landscape has changed and not only is there much greater access to goods and services online, but also customer expectations have evolved and the journey through to purchase needs to be as personalised and friction-free as possible.

In 2022, making a purchase is more than just a transaction. Your customers are looking for ‘experiences’ and that includes the entire purchase journey from discounts, offers, responsive UI and product displays, through to their choice of payment method and ongoing rewards for their loyalty. The expectation of good customer service is high and VIP customer care is no longer restricted to just luxury circles. Your audience know you have the data, insight and technical ability to offer a customer-centric service, so to compete for market share, you need to deliver.

With alternative options just one click away, it only takes for one part of your carefully crafted customer journey to fail to meet expectations for prospective customers to abandon their cart and head elsewhere. However, we can learn a lot from traditional loyalty schemes and by bringing them in-line with modern-consumer expectations, merchants can and will start to reap the benefits of digital brand loyalty.

What does loyalty look like in 2022?

Loyalty cards used to be an important thing in retail and that has been difficult to transpire to the digital world, but with exclusive sale access, discount codes and the omni-channel experience, you can capitalise on the new world of VIP customer service and loyalty. The key is offering flexibility to suit your audiences’ needs, but also that it is seamless and happens intrinsically in the background.

Customers want to feel recognised and like when they land on your website to purchase, that you know who they are, their preferences, likes and dislikes. The same goes for the loyalty experience. Research highlights that 81% of loyalty scheme members do not know the benefits of their programs or how they receive their rewards. There is a wealth of potential for securing customer retention and repeat spending, yet the reality is that many customers are disengaged and the loyalty and reward programs are not serving their purpose. They are not resonating with the audience and are not easy to consume.

Digital loyalty programs have the same objectives as traditional loyalty programs, however with data and insight, you have the power to make them much more interactive, intuitive and convenient for each customer. A unique experience with your brand, right in the palm of their hand. From rewarding a customer for signing up to the loyalty program in the first place, to tailoring your offers to each individual customer based on their previous purchases, to integrating a fun gamified elements into the shopping experience with social media competitions. Digital loyalty programs are a much more creative approach to rewarding customers for their ongoing loyalty.

Merchants need to find an effective way of tying people into their ecosystem and developing more luxury-retail style propositions is an appropriate and effective way of doing that. It is what customers now expect following the rise of such personalised services in the pandemic and is indicative of your customers’ growing propensity to seek extra value from each transaction.

The possibilities for loyalty through digital payments

Traditional loyalty schemes have one function which benefits both parties in a single way; the customer accumulates points, which in turn enables the business to reap the rewards of customer retention. However, digital loyalty programs serve a plethora of functions for both the customer and the merchant, especially when coupled with the digital payments process.

Data has changed how every business works, and loyalty programmes are no exception. With a digital loyalty scheme seamlessly integrated into your payment journey, you have greater access and insight into customer purchasing behaviour. With intuitive real-time reporting consolidating customer data, you can start to build a bigger picture of your customers’ behaviour, enabling you to offer a hyper-personalised experience and offers based on transaction history, preferred payment methods and local currency.

Analysis plays a vital role in customer outreach, how best to target and engage, and how to refine your loyalty program accordingly so it resonates with your audience. With your loyalty scheme natively integrated into your payment workflow, you can apply discounts at the right time and deliver an intuitive experience for all your repeat customers.

Having data is great, but the other half of the challenge is the ability to act on it. Luckily, we have the luxury of working in an era where 3rd party platform providers, such as BR-DGE payment orchestration, have made it comparatively easy to be reactive and flexible. With payment orchestration, you can not only collate and centralise all key reporting for data-driven decision making about your loyalty offering, but also integrate your loyalty scheme into your existing payment workflow, further enhancing the customer experience and reducing any unnecessary friction.

Are your online customers loyal?

It really does pay to build brand loyalty and the future lies in a digital, omni-channel solution.

With a wealth of customer behaviour insight and a streamlined loyalty process within your existing customer journey, you can deliver a personalised experience every time, that resonates with your customers and is seamlessly embedded into the ecosystem of your brand.

For more information on how payment orchestration can empower your brand to deliver a data-driven, relevant rewards program, natively embedded into the payment process, contact our BR-DGE Builders.