Rethinking Loyalty for Mobile
Once again, Amazon’s 2018 Prime Day sales broke previous records. Following the July 2018 event, the company reported that sales on its third-party marketplace were up nearly 90 percent and that small and medium businesses sales on the site had exceeded more than $1 billion.
Amazon has achieved this success in part due to its focus on the Prime mobile app, which hosts deals and activities for Prime Day and throughout the year. By launching groundbreaking loyalty programs that keep customers engaged, Prime has become an everyday part of customers’ lives. Amazon thinks about its loyalty program as far more than discounts, coupons and similar tactics – the company enacts loyalty programs that take advantage of the unique possibilities that mobile presents.
Though loyalty will (and should) continue to evolve with customer demand, companies looking to re-design or launch their mobile loyalty program should keep these guidelines in mind:
Don’t look for immediate value
It’s a common misconception that loyalty will have an immediate positive impact on a business. Like most marketing programs, mobile loyalty doesn’t have an immediate ROI.
“Most programs need a ramp-up period to acquire members and give them time to engage,” says Pam Spier, a senior manager at PK. “In the design phase, you should decide if you are building a short-term program for transactional returns or designing a new way customers will engage with the brand. The answer may determine the right philosophy for assessing return on investment. This needs to be incorporated into companies financial planning and programs must be given time to see results.”
Think beyond discounts and cash back
On mobile, loyalty is no longer bound to traditional tactics. While discounts and cash back may be one piece of your organization’s loyalty program, loyalty now also includes experiences that build a connection and brand equity with your customers. This can include tactics as varied as membership services, subscription offerings and experiential programs. On mobile, this means that companies have the opportunity to engage customers in new ways.
Consider Starbucks: The company’s mobile payments app invites customers to engage with the brand through traditional tactics, such as point collection and push-notification discount offers. Its loyalty-building aspects don’t end there, though: The app also offers a large bonus point award for meeting certain order challenges, such as ordering a latte, tea and breakfast sandwich in a single order. It also simplifies mobile payments, rewards customers with points for using the app’s mobile payments capability, and allows ordering ahead at any location – all of which encourage customers to engage with the brand and return to a Starbucks store. As a result, the app has become the most popular mobile payments app in the U.S., outpacing adoption of Apple Pay and Google Pay.
Focus on convenience
Don’t make your mobile loyalty program too complex for customers to navigate. Loyalty programs should encourage customer engagement, and too many hurdles in the form of rules or a complicated rewards program can prevent them from taking part. Users typically have a short attention span, even on the most popular apps: Snapchat, for example, garners just 2 percent of the average U.S. consumer’s daily time spent on mobile devices.
Perfect your UX and UI
Your technology foundation and user experience play a powerful role in connecting the dots between customers and a successful mobile loyalty strategy. Your mobile loyalty platform, whether an app or mobile site, should unite design with effective delivery in order to provide a great user experience with little or zero downtime. This requires you to have a data-driven understanding of customers’ actions on your loyalty platform and be able to identify and eliminate any gaps that cause downtime.
Consider the case of a national telecom provider that wanted to relaunch its customer loyalty mobile app. The telco’s servers frequently struggled to handle incoming traffic, preventing users from taking part in its mobile loyalty program. By working with PK, the company improved the user experience with a relaunch that included back-end improvements that vastly improved the app’s availability, eliminating downtime. By focusing on technology, the telco has been able to grow its loyalty app to engage 2.5 million active users each week.
As Amazon demonstrated with the recent success of Prime Day, mobile opens the door for new, innovative customer loyalty programs that build deep connections with your customers. Consider these guidelines to rethink how your organization designs its loyalty programs and what would best engage your customers on mobile.