Digital-style Loyalty Programs

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Digital-style Loyalty Programs

Today, almost any brand or retailer has a loyalty program – this is a must. But thanks to the digitalization of everything and everything, more and more “new generation” loyalty programs using mobile technologies and Big Data are gradually appearing on the market. We decided to collect interesting Russian cases recently by analyzing new features in the field of consumer behavior management.

When status and image become more interesting?

The basic mechanics of a typical loyalty programs for South Africa are rewards for action. But just a gift or a discount of the consumer has long been impossible to surprise or to keep. Gradually, marketers have come to understand that the formation of the “status” of the consumer through the gradual, systematic accumulation of bonuses is a more effective method for retaining the customer than the “here and now”reward.

This system is now actively implemented by the Russian chain-the franchise of coffee shops ” Le Pain Quotidien”(“Daily Bread”). As a result of the relaunch of its own loyalty program, the chain’s coffee shops have a multi-stage reward scheme based on earning ranks by participants. There are five of them: Bronze, Silver, Gold, Diamond and Platinum. Customers gradually accumulate bonuses for purchasing products of the chain, rising higher and higher on this coffee “Table of ranks”, getting a certain status and advantages. Naturally, the higher the rank, the greater the number of opportunities and bonuses-from special offers for positions in the menu to cash back from the order amount. You can find out your rank on the map by installing the Plazius app.

The coffee shop market, especially if we are talking about Moscow, is highly competitive. In such a struggle for survival, it is not even the purchase itself that is important to networks, but their life cycle – how much they will remain loyal to it and how long they will make purchases in it. Introducing the concept of “rank” is just a way to build a long – term relationship with the client. At the same time,” daily bread ” strives to maximize consumer motivation, using not only a wide range of material rewards. As a motivator, there is a time limit for making a repeat purchase: a customer who has not been in the chain’s establishments for a certain period of time risks nullifying their rank, losing their “status”, which was earned by buying French croissants for so long. For example, in order not to lose your silver status, you need to make purchases for at least 9,900 rubles within 2 months. In this way, the network manages to create an additional “security cushion”, ensuring the return of a loyal audience to it, managing the frequency of transactions.

Playing by the new rules

Among the growing number of rewards, both tangible and intangible, it is especially important to provide consumers with a new unique experience and engage them in interaction with the brand. Give the client a really interesting “bun”, entertain, evoke an emotional response – and he is yours. And this is where gamification comes to the aid of marketers.

Gamification is the use of the basic principles of the gaming industry in various industries: they include the accumulation of points/points, ratings, indicators of completion of tasks, difficulty levels, competitions between participants and the reward of the winner. Gamification, launched as part of a loyalty program, allows you to ” refresh” it, increase interest and solve specific tactical tasks – for example, promoting a new product.

When we talk about gamification in the “brand – consumer ” coordinate system, we mean a kind of quest, the essence of which is to earn points and pass levels. The fundamental mechanics of loyalty programs ” more points – more reward” is superimposed on the gambling excitement of the competition. Using gamification, complex products are promoted and the customer’s need for them is formed . the game acts as a motivator that attracts attention, for example, to try a new product or service, evaluate its benefits and use it in the future.

Perhaps the most famous and successful Russian gamification case for its clients was implemented by Tinkoff Bank. Over 35 days, participants had to complete 7 different tasks, according to which they had to make certain purchases. The campaign was aimed at increasing the use of co-branded cards OneTwoTrip, eBay, ALL Airlines, and of course, to attract new customers. It was a real quest, in which participants competed for the main prize – 1 million rubles and the final task, which was a trip to Sochi, paid for by a co-branded Bank card. More than 15,000 people took part in the quest, 444 people became winners and, as a result, the number of transactions on co-branded cards increased by 20%.

The game in the form of a quest, as part of a loyalty program for its customers, can be used not only by a Bank or a player in the B2C market – it can even be a fairly narrow niche B2B product. Here we can not tell you about the American case of Autodesk, the world’s largest supplier of design software. A preliminary study of consumer behavior found that those who installed the trial version of the program and ran it at least 3 times are more likely to become customers of the company in the future. Therefore, when releasing their new SOFTWARE called 3ds Max, the developers decided to apply a gamification strategy and “delay” users in the process of using the product.

Here, for the first time, they played into the hands of the fact that their SOFTWARE is not so easy to use. This means that you can create an exciting learning game for future users! During the training, participants earned points, passed online quests, and the most active ones received prizes from the company, while simultaneously diving deep into the use of 3ds Max.

The results of this campaign speak for themselves: the number of installations of the test version has increased by 45%, and sales have increased by 15%. Moreover, users who were interested in this” game ” also learned about other Autodesk products, which later significantly increased their sales figures.

The main thing is comfort

Try to remember how many loyalty cards from different stores or retailers you have? Ten? Twenty? More? It is not surprising that most of them are not used and lie peacefully in an even pile and collect dust somewhere in a drawer. However, thanks to the spread of the user-friendly approach through new technologies, this situation is gradually beginning to change.

Technological solutions in the field of contactless payment are becoming more widespread : Apple Pay, Samsung Pay, NFS identification at checkout, discount card aggregators like Stocard, Wallet, etc. have appeared on the market, even in gas station withing fuel loyalty programs for South Africa.

More and more brands are launching their loyalty programs based on their own mobile app, saving their customers from having to carry piles of plastic cards. Communication begins to move to the most convenient format for the consumer.

For example, the Russian private food supermarket chain Azbuka Vkusa relaunched its club program “Vkusomania” in the spring of 2016, completely transferring it to an online format based on the app of the same name. To do this, the network’s marketers re-segmented their consumer base, during which they identified 10 updated and refined segments with personalized message formats for each of them.

In the new program, bonuses are paid for almost all types of goods, accompanied by the accumulation of special “marks”, which can then be exchanged for other products under the promotion. Thanks to the mobile platform, you do not need to carry the card with you – after registering the user, the barcode is simply displayed and read from the screen directly at the checkout. Finally, the last cherry on the cake was the creation of a “Family” card – the possibility of group accumulation of bonuses for several family members at once.

The launch of the program showed really good results for our market: in the first two weeks of the launch, the app download and the number of virtual card holders reached almost 100 thousand people. The average receipt for this period increased by more than 4%. At the same time, according to the marketing Director of “Azbuka Vkusa” Galina yaschuk, the main goal of the network is to build a stronger long – term relationship with the end user, and the use of mobile technologies in this regard opens up very good prospects.

Another interesting feature was tested by another grocery retailer – Land, one of the leaders in the premium segment in the North-Western region of Russia. The chain introduced interactive devices – “loyalty Generators” – to some stores that made customers a personalized offer in real time, taking into account their purchase history. “Generators” look like compact printers with a touch screen that read information from the loyalty card presented, and based on previous purchases, form a personal offer, display tips about the most interesting products and promotions, as well as more profitable analogues of preferred products. But apparently something went wrong – everything ended at the stage of the pilot project.

Those Russian brands that were among the first to pick up the” wave ” of digitalization of loyalty programs are now trying to use the most modern tools for their implementation.

Thus, the retail chain of healthy food products “Vkusville ” deliberately refused to create its own application, preferring a bot in The telegram messenger. According to the company’s representatives “ “applications have become obscenely numerous”, while its own “robot” is a cheaper and more functional solution. For example, the Vkusvilla bot can show all current bonuses and discounts, change the user’s ” Favorite product“, and find the nearest Vkusvilla store. Moreover, the bot can perform technical operations on the card: change mobile numbers linked to the account, transfer accumulated points from a lost card, replace the “Let’s be friends” card within an hour after clicking the appropriate button.

While the bot “Vkusvilla” is running in test mode, but a number of its advantages are becoming obvious: ease of programming, quick launch at a lower price, user – friendliness-you do not need to download a separate application, you can just add the bot to The telegram contact list. This is really a one-click communication that does not require any effort or unnecessary actions on the part of the user and provides them with maximum speed and convenience of actions. The only question is whether the same solution would be suitable, for example, for a regional retailer – the popularity of Telegram in the regions is not comparable to that of Moscow.

One conclusion: mobile technologies are gradually changing approaches to the concept of loyalty programs

Now the loyalty program is turning into a way to give your customer a unique customer experience, let them feel the brand’s concern for their convenience, and demonstrate the ability to anticipate all their desires in terms of possible ways of communication. Loyalty programs become more complex, becoming a customized product based on a personalized message, high quality of service and individual approach to the customer.

The use of digital technologies in the implementation of loyalty programs gives brands an unprecedented opportunity to collect and analyze data about their audience. And not only about those who keep a discount card in their wallet. Thanks to omnichannel programs, an entire system of user identification is built in and out of the network. All this makes it possible to understand their needs and motivating mechanisms much better, which means that you can create the most relevant and accurate offer for each consumer, and put pressure on exactly the motivating points that you need.

That is why digital technologies in company loyalty programs are an indisputable must-have. At the end, they provide tools that can make communication with consumers many times more effective, and transfer regular customers to the desired status of truly loyal.

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