Loyalty programs for retailers are still very relevant today and intrinsically linked with customer loyalty. People go out of their way to advocate for brands they are happy about and consequently want to be rewarded for this loyalty.
However, how customers define loyalty has changed. They’re no longer swayed by 10% discount voucher emails, practically what every other business offers.
Nowadays, it is access to special events, invite-only product launches, or exclusive memberships type of loyalty programs that effectively communicate to customers that you value and appreciate them.
Traditional earn and burn programs are very transactional, and consumers are aware of this fact, implying that their attitude has changed. If you’re still stuck at this model, this article will cover new and updated methods plus tools to help you reimagine your loyalty program.
The Evolution of Loyalty
The evolution of loyalty programs traces back to the 18th century when businesses started offering copper tokens for repeat purchases. This concept expanded with the introduction of scalable programs like Sperry & Hutchinson's green stamps, inspiring other brands to adopt loyalty strategies.
Loyalty programs initially aimed at increasing revenue but creatively evolved.
The 20th century is technology-led with mobile apps facilitating real-time communication and brands such as Starbucks leading digital loyalty programs.
Today, reward programs have matured to meet customer expectations through deep data analytics and advanced technology platforms.
AI-Powered Personalization
Data is the backbone of personalization, and loyalty programs are a gold mine for this data. Even though a considerable demographic is conscious of sharing their details with businesses, over 50% of Gen Z and millennials are ready to exchange their data for value.
According to Thomas F. O’Toole, Kellogg School of 2023,
“The practice of marketing today runs on data. Predictive analytics and AI are
fueled by data. Data enables personalization. In short, marketers use data to
grow customer value.
A critical analysis of this data provides key stakeholders with insights for strategic decision-making, which can be achieved much faster and more accurately using artificial intelligence.
According to a 2022 report by McKinsey, companies that use AI in personalization can see a 15-20% increase in revenue and a 20-30% improvement in customer satisfaction.
Digital signage coupled with AI helps acquire data geared towards personalization. AI-powered facial recognition systems can analyze faces in real time to estimate the age and gender of individuals in front of the screens. This information can be used to give special offers based on demographics.
Cameras and sensors can track the number of people passing by, their dwell time, and attention levels for personalized rewards and incentives based on the observed levels of interest.
Interactive Kiosks
Increasing Customer Interaction
Self-service kiosks are a form of retail digital signage with a touchscreen interface for hands-on participation among users. Customers can conveniently enroll in the loyalty program, update their account details, or redeem rewards directly through the kiosk interface.
Interactive kiosks are also ideal for gamification elements to engage customers in fun and competitive challenges for rewards with digital badges or points.
Increasing the convenience of self-service
A survey conducted in June 2022 revealed that grocery retailers in the United States and the United Kingdom feared they would lose their customers to competitors if they didn’t offer self-service kiosks. Convenience is a huge contributing factor.
Consumers want access to information and quicker checkouts without the involvement of a staff member. They prefer the kiosks' ability to personalize their experience by checking prices, locating products, and even accessing personalized promotions.
QR Codes
Effective QR Technologies For Offers
QR codes are easy and practical to use with a low cost of production. Personalized QR codes boost customer loyalty and retention and help you better connect with your customers.
There are various ways that you can implement QR codes in your store for maximum impact:
- You can generate unique QR codes for customers tied to their loyalty accounts.
- Create a gamified experience by placing QR codes around the store that lead to different offers or discounts. Customers can scan multiple codes to unlock special deals.
- Use QR codes on social media platforms that lead customers to exclusive offers, promotions, or loyalty program sign-ups. They can be easily shared among friends, increasing the potential for new customer acquisition.
Telfar, the bag brand known for its highly coveted and frequently sold-out bags, launched Teflar TV, which displays QR codes during occasional broadcasts to grant dedicated fans early access to new products.
Taking Into Account The Habits of Generation Z Shoppers
Aligning Loyalty Programs With Generation Z Shoppers
In response to what would make loyalty programs relevant in the modern age, Jörn Roegler, the VP of Strategy and Insight at Antavo explained that:
“Customers are now much more interested in experiences than possessions. Customers choose brands more based on value than on price. Consumers are looking for things that simplify their life.”
This is an accurate overview of Gen Z shopper habits today. They’re looking for value-based shopping experiences while being partial on issues of sustainability, healthy living, and personalization. 81% of Gen Z consider loyalty programs when deciding whether to continue working with a brand(Bond Loyalty Report).
To appeal to this generation of young shoppers, you need to structure your loyalty program to align with their values. This could look like incentivizing eco-conscious Gen Zs to bring back old clothes to your store for recycling and rewarding them in return.
Digital Signage To Engage Generation Z Shoppers
The amount of time it takes to redeem a reward is one of the most disliked factors about loyalty programs(Statista). On the flip side, Gen Z lives for the moment and values instant gratification. You can reconcile these factors into your loyalty program by using digital signage to engage Gen Z shoppers with instant and quick rewards.
Here are some strategies:
- Display time-sensitive promotions and limited-time offers to create a sense of urgency that will encourage them to take immediate action to earn rewards.
- Use geolocation technology to deliver location-specific promotions and rewards on digital screens. It encourages Gen Z to engage with the loyalty program when they are in proximity to the store or participating venue.
- Display real-time updates on the status of loyalty points or rewards on digital screens so they can see the immediate impact of their actions.
Implementing Next-Generation Loyalty Tools
- BHN Rewards
BHN Rewards facilitates the management of digital reward programs. With automated rewards from popular brands like Amazon, Visa, and Mastercard, it enhances engagement and loyalty through lead-generation campaigns, customer advocacy programs, and team appreciation initiatives.
“The reporting and tracking functions make it simple for us to track sending incentives out to our respondents, we can see if the email was sent, delivered, opened, and claimed. It makes tracking payments quick and easy.”
- Xoxoday
Xoxoday streamlines global rewards, incentives, and payout programs with its automated platform. It’s equipped with multi-currency and multi-regional capabilities and also facilitates the seamless sending of rewards, incentives, and e-gifts throughout the customer lifecycle using a reward point system and scalable workflows.
- Yotpo
Yotpo is an eCommerce Retention Marketing Platform that helps brands enhance customer relationships through loyalty programs, SMS, email marketing, and reviews. Users love its ability to improve post-purchase communication, implement pricing incentives, and the capability to collect reviews using loyalty rewards.
- Alyce
Alyce is a gifting platform that makes it easier for B2B businesses to strengthen relationships, boost sales, and enhance brand awareness through personalized gifts.
“I utilize Alyce with hot leads who ghost initial meetings/intro calls, warm leads who are hesitant about getting on a sales call, or people with casual interest to push over the line from slightly interested to hop on a call. Alyce is relatively easy to use, with a clean UI. I sometimes will use Alyce to thank a prospect for joining a call or connecting with me. Great gift options, easy to track stats (good for personal use and relaying to leadership), and you can use your own email template and customize messaging.”
Building Loyalty In The Retail of The Future
Across the many touchpoints that consumers come into contact with your brand, what they want is a frictionless experience. The feeling that they got what they wanted, when they wanted it, and in the most efficient manner is primarily what will get you their loyalty. The association is a very important factor that shapes brand perception. And there are many technological tools at your disposal to shape it in your favor.
Loyalty programs for retailers can be personalized and better targeted by using digital signage. You can use your network of screens to provide information on exclusive offers, rewards, and personalized discounts. Look Digital Signage Software will help you get there faster and easily. It has features to help you customize your loyalty program content and manage it no matter where you are. Try our 14-day trial period today and see for yourself!
