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VIth Sense: Could a Loyalty Program Help Your Brand Soar?

Posted by Tim Berney

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23034-VI-GoodVibes-48.jpgWhat does it take for a brand to earn your loyalty? Meeting all of your expectations? Exceeding them? A loyalty program? There's no doubt that loyalty programs can be of tremendous value to marketers. But, developing the program and getting people to join it is just the beginning of the challenge.

There is no "Build It and They Will Come" result. Unfortunately, the term "loyalty program" implies that you will have a person's loyalty if you can get them to enroll. The assumption is that you'll deliver on your program's perceived great benefits and they will give you all of their business. But the reality is that you are merely developing a relationship with a prospect, and if you want the relationship to be exclusive you have to court them so well that they only have eyes for you. We should actually refer to them as "opportunity to earn loyalty programs."

Southwest Airlines has a loyalty program, (although they're so superior to other airlines that they hardly need one). Of course in keeping with their customer-centric attitude, they call it a customer rewards program. If you're a member, you get notifications of their great fare sales, the opportunity to achieve A-list status (which lets you board in the first group), the ability to earn points for free travel, and to skip the queue when you have to call them. It's not all that valuable monetarily in the grand scheme of things, but if you travel with any frequency you may as well become a member. One of the most visible things that they do is send some occasional drink tickets via snail mail. It's not an "official" part of the program, but just a random "thank you" that happens to go to all of their frequent flyers very regularly. The tickets look like the other mail that they send. Which is smart. I always open any mail from them.

What's in it for Southwest to provide these perks? They're always my first choice for air travel, yes — but think about all the useful data they are gathering. Data that helps them make even more money. In order to be a member of their program, I give them a lot of information. Not only do they know my name, age, gender, occupation and email address (which is pretty valuable). They also know where I usually fly, so last minute deals on open seats show up in my inbox. They have my credit card purchase history. They know who travels with me to which destination. And most likely some other stuff that I don't know that they know.

They use this information to personalize the promotions they send me. And, they have partners that can use this data too. Entertainment tickets in my favorite cities. Hotel deals. Discount subscriptions. 

Do you have this type of data on your customers and prospects? Are you effectively using it to drive repeat purchases? If not, you are likely missing a huge opportunity to grow your sales and to spend less dollars doing it. If data can get your customers to spend more with you and help you find more customers just like them, then a loyalty program is for you. You would have a captive audience of repeat buyers. And data to find even more. You'll be flying high.

The VIth Sense Marketing Strategy 
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