A loyalty program’s reward strategy is vital for success and has a great influence on customer behaviour and engagement. A poorly designed reward strategy can lead to low participation rates and even irritation among program members. Some of the most critical mistakes include little or no excitement value of rewards, not enough variety, lack of emotional incentives and rewards which are too hard to get.
But there are a few simple steps which can help you build an effective reward strategy which drives high customer engagement and satisfaction. Analyze Customer Profiles
As a first step, it is a good idea to analyze your customer base and their preferences and behavior. Even if you don’t use advanced analytics, you should already have an idea of what customers prefer and what characteristics they have. Later on, the loyalty program will help you to collect detailed customer data and base your offerings on customer demographic profiles, shopping behaviour and specific preferences.
Talk to Your Sales Teams
Your Sales Teams are often the ones which have the most information on customers. They will be able to tell you what kind of people use your products, what are their likes and dislikes and how they react to different promotional campaigns. This will help you to complete your customer profile analysis and focus on the right rewards catalogue.
Have in Mind Customer Segmentation
Even if you don’t split your loyalty program into different customer levels, you need to plan different purchase levels for your loyalty rewards strategy. For example, how many people belong to the lowest purchase threshold and many are into the top? What is the average purchase level for your target audience? Considering these characteristics will help you decide on the different redemption options and the range of choice.
For more information on loyalty programs, contact us at sales@loyax.com You can also read: Main Types of Loyalty Rewards The Power of Mobile Marketing 4 Tips for Improving the Retail Customer Experience