The combination of marketing and customer loyalty is not a new collaboration but it is the strategy behind it that has been evolving dramatically in the past few years and that drive is going to continue through 2017.
Momentum will continue to build in the loyalty program space and, therefore, so will the new ways these programs are positioned and propositioned to shoppers across the country.
Here are three trends to watch for in the next 12 months:
Younger shoppers driving a revolution in “word of mouth” marketing
As younger shoppers gain greater share of wallet, their expectations of experiences and services differ as does the way they choose to share experiences with peers. A study from LoyaltyOne research found that these younger groups, ranging from 18–24, are shifting towards a more “authentic” lane of sharing information, relying more on alternative sources of content when making a decision to interact with a brand.
No longer are advertising campaigns casting wide nets and reeling in shoppers of all ages; this new generation of shoppers are swaying away from traditional B2C marketing communications and are relying on third party “un-biased” sources such as social media reviews, vloggers, bloggers and inner circles (friends, family) more than the company or retail service itself (retail staff, advertising, celebrity endorsements). Younger generations are looking for an unbiased opinion and recommendation.
An example of a retailer doing it right is beauty heavyweight Sephora using sales associates as their online beauty vloggers—real people telling their real story about using a product carried by the store. These are viewed as authentic opinions by shoppers however are in tandem working as a controlled product message.
What does this mean for 2017?
Expansion in 2017 includes more active outreach and reward for customers supplying product reviews. Acknowledging the value of this information to this generation will be appreciated. Continue to see a wider social network focus. Don’t be afraid to ask what special shoppers expect from a brand
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. Finding out their “friction” points in the experience and addressing them will go a long way to build their trust. Superficial promises will be identified and easily cast aside. Speak with them via email, social, text 1:1 and learn from their point of view how you can improve their lives/experience.
Amplification of social analytics, the underused but necessary measurement
Whether you are an avid user or fair-weather viewer, social media has become a part of the everyday agenda. These are not simply channels that stream real time news or allow you to tag and post photos. With digital “Word of Mouth” increasing at an elevated rate, these channels are prime sources for data collection, behaviour mapping and measurement indicators.
Retailers looking to strictly advertise and convert customers on social media are missing a huge opportunity to discover untapped data about consumer trends, purchase intent and what is driving sentiment. Brands can respond in real-time with hyper-relevant content when analyzing social conversations across platforms. For example, if there’s a noticeable lift in conversation about how much snow has fallen, a retailer could push social notifications promoting seasonal outerwear or ski equipment.
What does this mean for 2017?
Product suggestions focused on helping make life better or easier should be the main objective versus a brand trying to unload over inventoried stock. Loyalty is a two-way street and customers can tell when it is being done “to” them rather than “with” them. Knowing and making the difference when marketing to customers is key.
The Internet of Things play and loyalty programs in 2017
As knowledge and interest continue to grow, the adoption rate of the Internet of Things will steadily increase among Millennials and their parents. These products offer many benefits, with one primary being safety. As the Boomers age, Millennials will increasingly be concerned for their parent’s safety and this will bolster the importance of smart products.
What does this mean for 2017?
Looking to the past, who would we have believed just 10 years ago that today almost everyone, 77% according to a 2016 Colloquy study, would be carrying a smartphone? Likewise, the importance and usefulness of smart technology will continue to expand.
It will be an exciting year for the industry as we look to see shifts in the power of digital, customer experience and innovation. Forecasting what is to come is half the battle, planning strategically is what will have marketers winning in the end.
Melissa Fruend is a partner at LoyaltyOne Consulting, responsible for the loyalty and CRM strategic consulting focus in our practice. Her team offers innovative loyalty strategies to improve customer engagement through increased customer identification that impacts revenues for brands. Recent client relationships include Abercrombie & Fitch, Giant Eagle, PetSmart, and Alaska Airlines among others.