How many occasions have you bought something online and felt a little forgotten?
What about purchases you’ve made in-store? Did you ever receive a warm ‘thank you’ communication thereafter?
Most importantly: As a result, how often did you (or not) return to these companies?
If your experiences are anything like mine, this ratio is probably around the 50% mark — leaving a lot to be desired, plus stacks of money left on the table from a business point of view.
“A loyalty increase of 7% can boost lifetime profits per customer by as much as 85%.”
(Source: Access Development via Brand Keys)
The power of customer loyalty is so vital, its effects could mean the difference between your business either thriving, just about surviving, or breaking down completely.
I know which one I’d choose!
Let’s use The Power Rangers as a quick, fun example that I doubt anybody else has ever applied to a marketing guide.
[Yep, I did say The Power Rangers. In future, I’ll definitely consider using this basic yet meaningful explanation when I buy from brands that just don’t seem to ‘get it’. You can do the same, by linking to this piece.] 😀
This is how The Rangers would have reacted after they paid top dollar for their costumes with the intention of buying more later on — only to soon feel somewhat abandoned by the company selling them: *
We’ve all been there, right?
Here’s the post-purchase formula you shouldn’t follow:
No follow-up contact + No rewards + No discounts off future purchases x No perceived appreciation = Zero positive vibes.
They aren’t likely to buy from the same brand again because they didn’t feel loved the first time; they will forget about the purchase because the purchase simply forgot about them.
And there will always be a better brand willing to prove its worth…
Such a large choice of other outlets is available, even on Google Shopping alone:
Inevitably, the colorful heroes will shop elsewhere for their future costume requirements until they experience a real, memorable connection they trust (and there they will stay).
THIS is exactly the type of brand you want to become.
The company customers flock to, remain with, and remember forever.
“77% of brands could disappear & no one would care.”
(Source: Marketing Dive via Havas)
^ I’m going to show you how to head straight into the 23% zone. ^
Half the time, customers may get the hint that brands they buy from are merely cash-hungry machines with no feelings…
Yet, just look at the undeniable significance of repeat business (that is ironically always the result of good feelings):
(Graphics & Research Sources: Lisa Jahred via HubSpot & CityGro via BIA Advisory Services)
Treat every customer like gold, platinum or diamonds, and the majority of them will treat you the same way.
Show people you appreciate their custom in ways they can’t forget.
As a bonus, it needn’t be too difficult (no matter your industry or business model) — you can begin with sincere gratitude and magnetic personality, while gradually working your way up the loyalty ladder.
Experiment with these proven loyalty boosters, ASAP.
[* Disclaimer: The Power Rangers were probably 100% satisfied with their costumes and the company that produced them. Sadly, I couldn’t find any verified reviews.]
Booster #1: Make It Known That You Reward Loyalty
The very first step to encouraging repeat custom is actually publicizing the fact you cherish those customers who stay with you.
Otherwise, how is anybody going to know?
It may sound somewhat obvious, but I’ve witnessed many brands fail to tell me how awesome they really are.
This crucial information can mean the difference between choosing one over another — so be sure not to make the same mistake.
Never hope for customers to stumble across your intentions; shout them from the rooftops (in an appropriate and non-annoying way, of course).
You have high expectations to meet:
“90% of consumers expect brands to deliver content, but consumers think 58% of content from brands is irrelevant & lacks meaning.”
(Rephrased from Source: Marketing Dive via Havas)
So, make your offers 1) substantial, and 2) absolutely unmissable.
On that note, this is one of the finest examples I could ever possibly show you:
Look at that wonderfully big ‘loyalty’ button.
Just in case you missed it:
It’s clear to see Alta Grill knows the value of customer loyalty — the brand has committedly shaped its existence around it to a large and very impressive extent.
If there’s any implementation of a loyalty program to emulate, it’s this one:
And have a guess what PeopleVine does?
Outstanding!
Whether you’re in the B2C or B2B space, a lot can be learned from this particular deployment.
On the other hand, the below pizza outlet has the right ideas — just not enough emphasis on loyalty, or adequate consideration of customer experience (CX) — because you astonishingly have to phone and ask to join:
Any additional step in communication can become a friction point for customers.
Also, due to a surrounding lack of focus around customer loyalty, this generic and site-wide ‘sign up’ CTA may seem far less compelling than the similar example presented on Alta Grill.
Why?
As a new visitor, I don’t really know what to look forward to upon signing up for ‘news & events’ — whereas I’m instantly drawn to subscribe to Alta Grill as a result of expectations the brand has already created (as soon as I hit any of its pages) thanks to the big sticky loyalty button etc.
i.e.
Immediate thoughts are along the lines of, “If I join this loyalty program AND subscribe to updates, I may receive even more benefits for doing so…”
Just a few relatively small tweaks can make a big impact on visitor psychology; those first impressions truly count.
Top 5 Considerations & Actions
- Don’t just add a loyalty program to your brand as an afterthought — become exceptionally customer/loyalty-centric
- Communicate your loyalty offerings everywhere, and stay in close touch with your audience once they give you the nod to do so
- Make it super easy for customers to join your program and grab their rewards
- Give them plenty! Forget building a loyalty program in the first place if you plan to be ungenerous (this will have the opposite effect, driving customers away)
- Always be fair — treat each customer with all due respect and give what is deserved on a case-by-case basis, whether they are new or returning
Here’s a fantastic example that is very careful not to alienate any type of customer, at any stage of their journey:
Booster #2: Create & Promote Multi-Level Incentives
Everybody likes to feel valued — but adding a transaction to the mix turns expectations up a notch or ten.
Tight bonds between brands and customers are based on the concept of reciprocity; so after spending their hard-earned cash with you, customers not only want to feel satisfied in return…
They want to feel important.
“Customers like to feel they’re being given special treatment…”
(Rephrased from Source: Neil Patel)
Tiered, highly-personalized loyalty programs are the perfect way to induce this sensation because when they are deployed correctly, customers experience greater intimacy with your brand — along with more rewards, exclusive privileges, and a stronger sense of belonging.
You can automate the entire back end process by cleverly using loyalty-focused tools straight out the box (like Alta Grill does via PeopleVine) or by creating your own unique mix of tools / custom-built sequences that utilize behavior-based triggers, which I touched on here.
But before any of that technical planning (not covered in this guide, you can wipe your brow!) here’s a simplified illustration of how you can first structure a tiered loyalty strategy that encourages customers to take very specific actions:
Tier 1: Customer signs up to newsletter, spends $X and/or buys products/services monthly
Tier 2: Customer refers 3 others, buys 3 products/services per month and crafts 3 reviews
Tier 3: Customer stays for 6 months [+ all actions from Tier 2, x2]
Tier 4: Customer stays for 1 year [+ all actions from Tier 2, x4]
etc.
Or, the more common method assigns points to an array of customer actions and give rewards based on total points accumulated:
Tier 1: 100 accrued points
Tier 2: 250 accrued points
Tier 3: 500 accrued points
Tier 4: 1000 accrued points
etc.
Starbucks graciously combines the two methods:
Make your tiered criteria as complex as you like; although I’d highly recommend starting off uncomplicated and working your way up. ☺
Of course, Tier 1 etc. are just placeholder names for the sake of demonstration.
Here’s how to wisely and publicly name your multi-level milestones for maximum psychological effect:
Tier 1 becomes Silver Membership
Tier 2 becomes Gold Membership
Tier 3 becomes Platinum Membership
Tier 4 becomes Diamond Membership
I’m sure you can instantly feel the difference — along with the irresistible desire to reach higher tiers, as you would in a video game (a default human response to gamification).
This graphic from Signal says it best:
NOTE: Please be the cool brand! Never, ever punish customers by threatening removal of reward ‘points’ over a period of inactivity. They’ve earned them, so this injustice will severely affect relationships. #Cringe
Instead, it makes sense to lovingly encourage their return with friendly reminders (coming up next). This keeps everything totally positive, and both parties win.
Basically, just forever ensure you make your most loyal customers feel like VIPs.
Here’s another real-life example from Royal Caribbean International cruises that works on a points system:
Pinnacle Club. How exclusive does THAT sound?
Check out why all this thoughtful branding matters:
Tiers give perceived social status to customers, presenting them with an opportunity to rank higher than others.
Along with greed, it’s just a primal human mechanism that inherently exists within us — despite many people tending to deny these stigmatized inner cravings.
Scientific studies have back the case that it’s normal for humans to explore where they stand in comparison to peers.
It’s known as The Local Ladder Effect.
Think about it — the games we play, the sports teams we support (plus their collective league tables), and even the cars we own…
It’s all status-driven; and our expanding digital world is a highly stimulating, addictive place to compete.
Furthermore, an intriguing study by Emerald Insight was carried out with a view to determining participants’ perceptions of multi-level reward programs:
“The results show that belonging to the top-tier level of a multi-level loyalty program seems to boost perceived justice. Participants assigned to this level in the experiment perceived the program as more just than did participants assigned to a lower level.”
(Rephrased from Research Source: Emerald Insight)
The same research into this loyalty model discovered an increase in satisfaction among top-tier members, while still avoiding making anybody feel disappointed in the second-tier.
So, based on this knowledge, have one guess as to what the next step in your multi-level loyalty program should be? 😀
You got it:
Enable your customers to compare their scores, points and/or rankings with other customers.
This can also work extremely well for B2B, in case you’re wondering…
Autodesk is a multinational company that produces software services for (get ready for this) — the architecture, engineering, construction, manufacturing, media, education, and entertainment industries — yet the brand actually transformed its software trial into a successful game!
Truly inspiring work:
“Autodesk has been honored by industry analyst firm Gartner and 1to1 Media for making the Autodesk 3ds Max software trial into a game, which allows users to compete in a more engaging learning experience.”
“A gold winner for CRM Integrated Marketing, Autodesk was selected for this award due to its customer-centric approach to improving business performance.”
(Rephrased from Source: Autodesk)
Top 5 Considerations & Actions
- There’s no need to feel restricted by your business model — Autodesk has shown you the potential for gamified loyalty / engagement in the B2B space
- Reserve your top tier for only your most special customers — they are your elites, and should be treated differently to others (but not at the expense of others — a key point to remember)
- Communicating this aspect will additionally increase the appeal of your top tier, encouraging other customers to shoot for the stars and become exclusive members
- Only release your multi-level reward program after vigorous testing — you can even ask loyal customers to test it for you in a closed beta environment, further strengthening their attachment
- Frequently ask your audience for honest feedback — you want to know if they are happy with their rewards and your overall deployment (because there’s always room for improvement)
Booster #3: Re-Engage Disconnected Customers
“Once a customer stops interacting with you, it’s time to completely delete them from your systems and forget they ever existed.”
– Said no successful business person ever.
Regardless of how far in the future you may be, and how long ago customers bought from you (as long as you devotedly abide by their communication preferences) — you’re missing a big trick by failing to get in touch.
In fact, make that a HUGE trick:
Perhaps you had numerous customers in the past who thought your experience needed improvement back then, so they left you for a competitor…
Or, you might sell in a highly competitive industry where loyalty is difficult to achieve.
Maybe you’ve managed to keep customers paying, although they seem quite distant by showing little or zero involvement in your brand — and their purchases have also reduced over time.
Fear not, this needn’t be the end of the story.
Once your new, tried and tested loyalty program is rocking the show, you can now dig deep into your customer data to offer incentives and strike gold.
“Approximately 40% of online shopping revenue derives from repeat custom.”
(Rephrased from Research Source: Adobe)
[Many varied studies have been carried out — and without being pedantic about variations in precise figures, they all draw the same overall conclusion — businesses simply cannot afford to overlook past or existing customers.]
Along with your historic and precious customer data, there is a trio of essential ingredients required for any loyalty program or re-engagement strategy to work the way you’d want it to (from the very beginning):
- Regular communication
- Tasteful persuasion
- Accurate personalization
You need these ingredients to perfectly blend together for the ultimate loyalty masterpiece.
In an ideal world, your business would have been thinking this way since day #1.
I’m talking ‘thank you’ comms, frequent email marketing (that boasts a solid reputation for ROI), relevant blogging, and targeted mobile marketing, to name just a few examples.
However, let’s continue to imagine we’re late to the party here — your brand has only just recently launched its rewards program, and only today you can start drastically reducing the amount of disconnected customers by introducing some powerful methods.
Customer Data Is Your Best Friend <3
If you flinch at the word ‘data’, just bear with me and you’ll see how important it is to your loyalty efforts. ☺
To initially identify who you’re going to be communicating with, open up your marketing automation tools and CRM software if you use one. Then, segment your customer data into ‘actives’ and ‘inactives’ based on interaction levels and what you know to be your typical evergreen sales cycle.
I say evergreen, because the journey has only just begun when a customer buys once.
This graphic by Cleverism depicts the ideal funnel to have in place:
e.g.
— A software-as-a-service (SaaS) company will often take scheduled recurring payments while having the innate ability to track product usage, which probably makes this business model one of the easiest to analyze
— B2B companies may often experience far longer periods of customer inactivity than standard B2C brands, due to business decisions demanding much more consideration
— B2C brands that only sell Winter clothing will inevitably witness larger gaps in customer action, and so on…
[If you are unsure of your sales cycle, here’s a quick guide that explains how to calculate it.]
Next, marry this info with data on customer interaction such as social engagement with your brand, email replies, phone calls, submitted reviews etc.
If you don’t keep track of all this already, make your move now and invest in awesome tools.
It should go without saying:
The better your tech stack today, the easier this process will become in future.
e.g.
— Nimble is a CRM software that can also be used across social media to auto-monitor, categorize and score people on Twitter, LinkedIn etc — just as you would with leads on your website
— HubSpot offers a free CRM for small businesses
— Both tools integrate with an array of marketing automation software providers
— Optimove (PostFunnel’s sponsor) is a higher-tier option that binds all your data together and optimizes the customer journey
Within these tools or via exports, you will either be able to segment customer data yourself or ask your vendor to do it for you.
Try sorting the data by these basic rules to identify dormant or somewhat disconnected customers:
- Customers who haven’t purchased in X days, weeks, months or years
- Those who were purchasing frequently, then reduced or stopped
- Customers whose buying patterns have shifted from constant to sporadic
- All the above, but instead replacing cash transactions with other brand engagements
- Customers who purchase less now, but still positively interact on social media
etc.
You can mix ‘n’ match the formulas as you please, calculating all kinds of averages such as customer service interactions (to determine the impact of support), customer engagement levels (on different platforms), or customer lifetime value (both actual and predicted) — making them extremely powerful insights to own and access.
Once you have your data segmented, you can be rest assured you’re hitting the right people with the best offers at the optimal stage in their journey.
As it’s likely to be email addresses that you primarily obtain from customers, here are several email ideas to experiment with — bearing in mind you really need to try and capture attention (and hearts) first time around:
The ‘Lost Without You’ Method
Imagine you haven’t heard or bought from a brand in a year or more.
Your life is so busy, you may have even forgotten its name…
So, what will it take to win you back as a customer?
This offer might just succeed:
(Screenshot Source: Doggyloot)
But there is definitely more that can be done.
Adding a name to the visual mix adds a whole deeper layer of intimacy:
The ‘Why Did You Leave?’ Method
Sometimes, we just need to say it how it is.
With similarities to the example above, this email goes a step further by cleverly utilizing cart abandonment software to remind the customer what they left in their basket.
In addition to the cute dog (a familiar tactic to evoke emotion), it asks the customer a question that not only encourages a spark in engagement, but also requests vital information as to why they didn’t complete their purchase:
Genius.
The ‘Related Product’ Method
Nobody does it better than Amazon:
Again, personalization is key. (And it must be right.)
Your email could look something like this:
If a customer hasn’t heard or bought from you in a long time, you can try showing only highly-specific products and/or services related to their most purchased goods — perhaps only one that is a brand new, upgraded version of what they previously ordered. This is especially powerful post-purchase if your ecomm growth strategy doesn’t yet emphasize increasing customer lifetime value through email.
They may not have actually heard about it yet = Your chance to shine.
[Read my big guide to upselling and cross-selling, here.]
The ‘Quiz’ Method
Depending on your audience, a fun quiz can joyfully entice reactivation…
Especially when the quiz is based exclusively on personalized customer needs:
The ‘Special Day’ Method
Providing you collected this information, a birthday email treat cannot fail to at very least bring a smile to a customer’s face after a duration of time when they may have forgotten about you!
It’s entirely worth your effort:
“80% of customers who are no longer loyal to a brand say the company could have done something to retain them.”
(Rephrased from Source: OptiMonk)
BONUS BOOSTER: Loyalty Platforms To Try
I’ll wrap up now with some super cool tools to help you automate your B2C or B2B loyalty programs.
Remember how Alta Grill uses PeopleVine?
Here is a selection of other market leaders to check out:
- Annex Cloud — With clients like HP and NBC, Annex Cloud’s experience based approach to customer loyalty software empowers you to reward customers throughout the complete customer journey to build genuine, lifelong loyalty.
- Clutch — The Clutch team have deep expertise in loyalty strategy, integrations and execution across multiple verticals, building a collection of success metrics along the way for renowned clients such as Pandora.
- Zinrelo — Aside from an absolutely delicious interactive homepage (below), Zinrelo encourages multiple dimensions of loyalty including transactional, social, advocacy, engagement, and behavioral loyalty. It even supports omnichannel across desktop, mobile and physical stores. Basically, the full works!
- LoopLoyalty — This tool uses a slightly different approach; “Your brand alongside customers’ credit cards in Apple Wallet and Google Pay.” Certainly worth a peek in our increasingly mobile world.
- FiveStars — Boasting an impressive client base of over 13,000 businesses, this attractive platform has established results worth 10x that of other marketing techniques.
The vibrant websites alone are enough to convince anybody…
Happy experimenting. 😀
#StayLoyal
