Win Customer Loyalty With a Dynamic Approach to Mobile Rewards
This article was published at Total Retail magazine. You can read it below or at the following link mytotalretail.com
E-commerce is booming, the in-store shopping experience is becoming more tech-driven, and personalization is moving beyond simply “nice to have.” Retail organizations are under immense pressure to innovate, attract new consumers and retain customer loyalty. The key to unlocking the next big thing in retail is in a device we are glued to — smartphones. This article analyzes how retailers can leverage dynamic in-app loyalty programs to introduce a more responsive and meaningful approach to rewards, personalization and customer engagements.
Studies show mobile devices now generate more than a third of all U.S. retail e-commerce sales — a rate expected to hit 53 percent by 2021. Younger generations of consumers are driving this momentum, with higher expectations towards not just products, but also brand relationships. Shopping on smartphones is as natural for them as selecting a “recommended for you” movie on Netflix, paying from a mobile wallet, or checking the weather or travel updates on the go. Earning, accessing and using loyalty rewards needs to be similarly mobile, easy and personalized, too.
Convenience at Your Fingertips
Faster checkouts, seamless omnichannel experiences and a choice of easy payment methods have become characteristic of the retail industry’s effort to improve the customer experience. And whether it’s scan-and-go checkout, tap-and-go payment apps or m-commerce sites, the common denominator to achieving these is mobile.
Touching a card — physical or virtual — at an NFC-enabled terminal at the point of sale accelerates the payments process. If the card is kept in a mobile wallet or the transaction is facilitated through a mobile pay app, consumers can get instant push notifications, confirming the transaction took place and reassuring them that the right amount was paid.
This is something we’ll see more of in the future, as research shows the tide is turning on mobile payments. Mobile contactless payments are growing at a nearly 31 percent compounded annual rate and will exceed $1 trillion worldwide by 2022. Retailers can ride this wave and create a seamless shopping experience by moving more elements of their customer strategy to mobile — and customer loyalty tactics are not exempt from this.
Evergreen Loyalty is Turning Shoppers Blue
Coupons, promotions and deals come in all shapes and sizes. Some North American drugstores like to tag them onto the end of sales receipts, making them stretch over a yard. But will the customer keep a receipt that long or will they choose the trash can instead?
Evergreen loyalty programs are fizzling out. Some retailers have moved to digital channels, sending special member emails or moving coupons online, but these still don’t achieve real-time engagement. Loyalty programs need to hit four criteria: frequency, relevancy, interactivity and visibility. I call these the four principles of dynamic loyalty.
First, rewards, deals and offers need to be regular. They need to be tailored both to customers’ preferences and delivered at a time and place when they will find it useful. When loyalty programs are interactive, it means shoppers can easily check or get notified of time-sensitive offers to ensure they never miss a deal. In-app notifications of completed offers and rewards can further provide the visibility needed to reinforce trust with customers.
Designing a mobile-based loyalty program doesn’t mean retailers need to learn coding or hire IT technicians to develop a solution. There are solutions that allow for a high level of customization to a brand’s needs as well as personalization to the customer’s shopping preferences without an IT overhaul or technological expertise.
Forging Shopper Loyalty at Every Transaction
Intelligent mobile solutions are a strategic enabler for increased customer engagement, more effective loyalty programs and a smooth shopping experience. A dynamic approach ensures retailers can interact with their customers at the right time and place, and offer something they want and can use at any given moment.
What dynamic loyalty-enabled retailer apps can do that other digital rewards programs can’t is integrate with credit card networks to deliver two of the top things consumers look for: convenience in payments and loyalty rewards. Fintechs have evolved to help retailers make this a reality. There are app-based solutions that make integration seamless, customization simple, and the bottom line healthy.
As a growing number of people use their smartphones to research products, engage with brands, shop and pay, in-app dynamic loyalty platforms are offering a huge opportunity for retailers to future-proof operations.
Mehmet Sezgin is CEO and founder of myGini, an integrated payments and loyalty engine.