- Design industry shaping loyalty programs
- Integrate easily and go live quicker
- Deliver hyper-personalized consumer experiences
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By4 Min Read
July 26, 2011
One of the most ubiquitous quote in the retail world is ‘Customer is King’. But when the consumers have a long line of retailers as suitors, it is only natural that it will require a lot more than vanilla marketing to win them over. And just like everything in our lives, the loyalty program has to evolve to make more sense to today’s consumers.
For most consumers, the world has become faster, with more choices, multiple channels competing for their attention as well as thousands of personal conversations brands have with them. In this environment, being able to break the clutter and create a connect at the right time is critical – and what better time to start that conversation than when the customer is in the store, on the mobile phone – a medium they carry with them at all times – and engage with them in real-time.
Instant Gratification is the Cornerstone of Real Time Engagement
Perform a simple experiment: ask ten people around you if they remember the number of points they have in their favourite loyalty program. Our research shows that eight of the ten people will be unable to recall this. Most loyalty programs communicate with the customer when they have gone back home, and by then the interaction is not on the top of their minds. The right time to talk to the customer is when they are in the store – when you get most of their attention.
If a customer buys a top and a retailer is able to suggest matching skirts, probably top it up with a small offer, the likelihood of that being picked up is the highest. For one, the retailer is able to cross-sell and monetise the current visit of the customer, and at the same time, this discount offer is better for the retailer’s margins since it could be much lower than what is required to make the customer drive and come to the store.
Recently, a UK based department chain, launched a real-time engagement campaign with Capillary. Within three days of campaign, the average spend per customer increased by 36%. The campaign was designed to engage the customers in-store through SMS while making a purchase with relevant offers based on their current and previous transactions. By the end of the campaign, the stores witnessed an average of 141% increase in top-line numbers.
Delight Your Customers with Experiential Rewards
Being able to provide the customer with the best product or service is not enough today, the experience counts as well, and every small little thing you can do in this regard has an impact as it’s these small things that consumers remember, building deeper relationship and loyalty. If a customer just finishes a long shopping trip, and the retailer is able to delight them with a foot massage available in the spa next door, the retailer has definitely won them over.
This is relationship marketing at its best – and by using technology intelligently for the right communication at the right time, retailers are able to today realize what used to be an unmanageable item on the wishlist. The customer is enveloped in the shopping experience, and additional rewards or communication is very personalised and directed. This is also sharply in contrast to the countless, irrelevant messages people get when they are at work, or busy elsewhere and the messages become more a source of nuisance than information or engagement.
Connect Better with Younger Audience
Recently, Starwood Hotels & Resorts launched a campaign to reward members of its ‘Starwood Preferred Guest’ loyalists by offering free points and free-night awards for those who check in to properties worldwide via the local social network, Foursquare. They may form a small segment of their customer base, but they are extremely valuable with substantial lifetime value.
In other cases, retailers are able to surface social network activity in their vicinity to their store staff helping them react better to valuable customers, giving them the right suggestions, and up-selling based on their likes and dislikes – all this happening magically in real-time by the power of the mobile phone and the internet connection.
Empower Your Store Staff
Most retailers ask me why is in-store communication and visual merchandising not enough – the answer is threefold:
Firstly, in today’s fast paced world, decisions need to be taken quickly which means lead time for staff training & communication and collateral printing is very low – instant mobile communication gives a simple way to perform interruptions and iterate quickly. This is especially true in very busy stores, where the cashiers hardly have time to breathe let alone trying to indulge in a discussion.
Secondly, in most cases, taking away the decision making power on deciding the gratification also mitigates fraud scenarios. The brand is able to communicate with and give offers to the customer directly and the rewards can not be kept aside by the cashier without the customer’s information. This also gives the customers a consistent experience across different touch points and stores, thereby leading to higher loyalty.
All this has to happen in real-time. We are quickly moving into a phase of intelligent cash tills, which not just enable transactions but also give suggestions, recommendations and help to cashiers to make the customer’s experience more meaningful.
However, employing the right technology tools for real-time engagement is very important – used well, it can greatly enhance the customer’s experience while if there are problems, the customer experience degrades very rapidly leading to loss of faith and brand loyalty.
Instant is now a necessity, not a USP
With more and more brands embracing instant customer engagement, it’s important not to leave this tool out of your arsenal while designing your customer experience. With the rapid change in consumer lifestyle, the ubiquity of mobiles phones and always-on broadband connectivity, real-time engagement is not just possible today, but is fast becoming the medium of choice for retailers.
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