Whether loyalty is a new concept for your company or you’re considering making a greater investment, here’s a guide to finding the right loyalty technology solution to meet your brand’s needs.
Define your loyalty program objectives
Before you start thinking about program design and setting up demos with vendors, establish what exactly you want from your loyalty program from a business perspective. Are your objectives to acquire new customers, improve retention, create brand advocates, increase the spending of existing customers or all of the above? At this phase, consider investing in qualitative and quantitative research about what your customers value and respond to about your current program and your brand initiatives. This is an important step in defining what your brand goals should be for a loyalty initiative. Each objective must be defined and must be measurable against a timeline.
Consider different loyalty technology solutions available
Once you have established the goals for your loyalty initiative, the next step is to determine which type of loyalty platform is appropriate for your business to meet your objectives and targets.
In order to do so, you must consider what your budget allows, level of sophistication you need, and how quickly you need to get it into market. Assess what your competitors are doing in the loyalty space and try and understand how you can differentiate your brand and add greater value.
Then the most important factor to establish is how you choose to reward your customers – for transaction only or for engagement with your brand also.
- Transaction-based options
If loyalty is a new concept for your brand, you may consider starting off simple with a transaction-based loyalty program. Transaction-based loyalty programs reward customers for spend and capture data such as number of purchases, transaction spend, and types of purchases. However, transaction- based loyalty programs lack robust data on who your customers are and what they want from your brand. They offer a view of only one touchpoint in the consumer lifecycle, and give little insight into behavior and preferences.
- Engagement-based options
If your goals are to increase retention and drive greater spend you should tailor your strategy to better meet the needs of your customers by adopting an engagement-based loyalty program. Consider investing in an omnichannel loyalty program that provides members with the opportunity to earn points for activities across every channel including in-store or online purchases and social media interactions, and go beyond one dimensional discounts and coupons and let your members redeem points for exclusive rewards and one-of- a-kind experiences. This type of program enables marketers to gather crucial data to drive marketing performance and provide customers with relevant personalized experiences.
Considering solution types
Once you have mapped out the functionality you want from your program, you can evaluate vendors and assess your internal resources to determine what level of customization, if at all, you need.
It’s worth noting that choosing a SaaS loyalty provider is oftentimes the easiest, fastest and most effective option due to its out- of-the-box functionality and speed to market. A custom-built solution will take more time to develop and require a larger investment.
Once you have established the type of solution and functionality you want from a solution the next step is to evaluate relevant vendors. These are the key areas of criteria to include in your assessment:
Choose a vendor that has a client list that includes well-known brands. They should be able to make quality recommendations for your brand given their experience. Ask them about their track record for success. How have the programs they’ve launched for brands made an impact on their business? Can the company demonstrate that the programs they power drive incremental revenue six months after launch? Also consider whether the vendor has certifications and designations from reputable analyst firms and industry associations.
- Service & Support
How much or how little support does the vendor provide throughout all stages of launching a loyalty program? A reputable vendor should offer to help your brand promote the program to your customers to increase signups. Ask vendors whether there are varying levels of support available and if the provider can manage the day-to-day operations of your loyalty initiative if needed. It’s also important to establish how quickly your vendor can get the program into market, especially if you’re up against a deadline.
The technology must be simple for marketers to use and navigate so that minimal training is needed. However, full training and support should be made available. If the platform is complicated, chances are you will find it challenging to make updates to your program without assistance.
In terms of functionality, ask your vendor about their customer data capabilities and whether they can provide your brand with actionable insights. The loyalty platform should also easily integrate with the systems your brand uses internally, like CRMs, point-of-sale solutions, email service providers, etc. Ensure that there is a clear process in place for system integrations so that your program gets into market as quickly and seamlessly as possible.
After speaking with and evaluating vendors you should have a better understanding of the resources and investment required to get your program off the ground.
For more advice on how to choose and get buy-in for your loyalty technology solution, download our whitepaper “Building a Case for a Loyalty Solution”.