Five ways to make your retail loyalty scheme a success

| May 23, 2019 | By

Digitally-led loyalty schemes have the power to transform a retailer’s customer strategy. Dani Fellows, retail product manager at Yoyo, reveals five ways a loyalty scheme can deliver a seamless rewarding and personalised experience that measurably returns increased footfall, sales and customer lifetime value. 

Five ways to make your retail loyalty scheme a success

 1.Be clear about why you’re running a loyalty scheme in the first place

Loyalty schemes are not about giving free stuff away – they’re about delivering two key outcomes:

Customer lifetime benefit
Your customers want to feel recognition for their custom – your loyalty scheme needs to deliver clear savings and rewarding experiences so they have a vested interest to re-visit your store.
Customer lifetime value
You want to build loyalty around your brand – your loyalty scheme needs to measurably maximise retention and increase the long-term profits you make from your customer base.

In short, your loyalty scheme should be core to your customer strategy, creating ongoing positive emotional connections between a shopper and your brand, whilst giving you access to the customer data and behaviour patterns that will help drive more sales.

2. Don’t make your customers work for their rewards

Going through time-wasting sign-up processes, always needing to remember a loyalty card, or having to go through laborious red tape to redeem rewards. These are the most common causes why customers won’t sign up to or soon grow tired of a loyalty scheme.

If your loyalty scheme is to succeed, it needs to be an effortless experience for your customers. Through a digitally-led solution, you can combine and automate loyalty collection with payment, creating a seamless, consistent and rewarding experience whether your customers are buying in-store or through your online channel.

When a customer uses Yoyo to pay, we recognise the items in their basket and instantly deliver any corresponding loyalty points, stamps, rewards or discounts, as well as a fully-itemised digital receipt, which is also better for the environment.

Yoyo’s combined payment and loyalty experience is 4X faster than contactless cards and here’s a video to prove it:

3. Forget one size fits all, deliver real personalised experiences

Your customers are now able to instantly pay and earn loyalty at the checkout, whether in-store or online. Take this experience further by personalising the rewards they receive.

When you can analyse what each customer has in their basket, you can utilize this data to identify basket attachment, deliver rewards customers actually want and drive behaviours that are beneficial to your business.

Offering a free coffee to a customer who only ever buys soft drinks is useless, both for you and them.

But if you can identify that your power customers always buy a croissant with a cappuccino on their way to work, you can then reward all cappuccino drinkers with a free morning croissant, which is far more likely to delight customers, drive product adoption, increase average spend and change long-term behaviour.

Last month, one of Yoyo’s retail partners ran a two week loyalty campaign, which specifically targeted customers who bought a coffee in the morning more than twice a week. Entitled: “Double points when you buy from our new breakfast range”, the campaign saw customer visits rise by 24%, revenue go up by 21% and average customer spend increase by 16%.

Personalised campaigns like this helps you increase your campaign conversion rate and measurably raises the CLV of your customers.

4. Focus on feeling and be spontaneous

At this stage, you’re adding more value to every single payment experience and your customers are personally rewarded for their loyalty. However, no matter how easy and rewarding your loyalty scheme, customers can quickly grow bored. Now it’s time to firm up anticipation and engagement around your customer experience.

Surprise and delight is an excellent marketing tool that delights your customers with unexpected rewards. With your loyalty scheme tied to the payment process, customers can also be instantly entered into a prize draw or seasonal campaign when they pay.

Imagine a Spin the Wheel suddenly pops up on a customer’s mobile screen just after they’ve paid for their items. They tap the screen to spin and are rewarded with a personalised gift, such as a free sandwich on their next visit.

Not only does this drive return visits, the emotional response is positive, it creates a memorable experience and it drives shareability and referrals. And even if the customer doesn’t win the first time, the need to win drives…you’ve guessed it…a desire to make a return visit.

Caffe Nero launched a festive app campaign ahead of Christmas through it’s Yoyo-powered app, rewarding every customer with a digital Christmas Cracker – some filled with Nero prizes, some not.

The campaign saw sales increase by 50%, unique customers go up by 30% and average customer rise by 13%. One happy customer said: “Whoever at Caffè Nero HQ came up with the Christmas cracker initiative on the app has won 2017.”

5. Utilize your loyalty scheme to segment customer behaviours and optimize marketing spend

Segmentation is the process of filtering existing customers into groups (or segments), based on a variety of characteristics so that marketers can better target their campaigns.

However, most CRM platforms can only create broad, unreliable segments, with groups pulled together through traditional demographic attributes or limited prescribed formats, which are unable to respond to ongoing changing behaviours.

But if you can identify that your power customers always buy a croissant with a cappuccino on their way to work, you can create a segment of users who buy cappuccino in the morning, but have never purchased a croissant – then encourage them to do so by giving extra rewards (50% discount, double points, bonus stamp, etc) if they exhibit that behaviour.

You can now design your marketing strategy around not just by who your customers are, but by what they do. You’ll be able to create marketing campaigns that target your most responsive customers, analyse lifecycle stages, and measurably increase long-term customer lifetime value (CLV).

And what’s more, you’ll be able to deliver these campaigns directly to your customers, whether by in-app messaging, push notifications or email at just the right time, based on when and how they shop.

Yoyo has introduced an industry-first omnichannel campaign builder that segments and markets to shoppers based on their spending behaviour, regardless of whether they shop in-store or online.

Yoyo has just introduced its most powerful marketing campaign creation platform to date

For the first time, retailers can cross-segment their identified in-store and online customers into dynamic behaviour groups, with hundreds of conditions to choose from, including products they’ve bought, their favourite time to shop, average spend per visit, outlets they’ve visited, projected yearly spend, and when they’re beginning to slip away.

Whether on or offline, for the first time retailers will find themselves in a position to design their marketing strategy not just around who their customers are, but by what they actually do. They can now create marketing campaigns that target their most responsive shoppers, influence and change lifecycle stages, and measurably increase customer lifetime value (CLV).

If you want to find out how Yoyo-powered marketing campaigns can help you measurably increase customer spend and footfall, minimize churn rates and build long-term customer lifetime value, visit