Building Customer Loyalty Takes Way More Than Discounts

Deploying a retail customer loyalty strategy is much more than just offering a discount for continued patronage. As Beagle Research Group founder and managing principal Denis Pombriant explains, it's the connection between a consumer experience and the customer journey.

And, when done right, it can pay off big, said Pombriant, noting industry research revealing the potential to boost profits by as much as 20 percent.

The problem, however, is that the majority of retailers aren't developing, deploying or managing strong, lucrative and rewarding loyalty programs. Many tend to 'set it, then forget it,' explained Narina Sippy, CMO, Stellar Loyalty.

Sippy and Prombriant offered up expert insight on loyalty strategy during a session at the Interactive Customer Experience Summit 2016 held in Dallas last week.

"Many are poorly designed and can end up hurting and destroying a brand's value," said Sippy. But then there are some retailers boasting superior loyalty programs, such as Marriott, Sephora and Amazon Prime.

"Loyalty is all about the customer. You can't buy customer loyalty but you can earn it," said Sippy. Stellar Loyalty is a two-year-old app provider offering cloud-based, big data customer loyalty solutions.

While there are many approaches to promote loyalty, such as contracts and what Sippy called 'high wall gardens,' sometimes the most basic can prove valuable. She referred to the decades-old green stamp grocery loyalty programs used to keep shoppers coming back to the same stores.

"Brand loyalty," said Sippy, "should be a two-way street and more than rewards and more than the transaction." The two experts described a vital loyalty strategy as one that enhances the customer experience and the retailer-customer interaction.

And that, said Pombriant, requires knowing how to make the customer happy. Prombriant recently published a new book, "Solve for the Customer," identifying how brands can better engage customers by using customer science.

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