Today’s consumers are increasingly spoilt by choice, meaning brands have to work harder than ever to earn any level of loyalty. That hasn’t stopped many from trying however.
In today’s retail climate, personalization is king, with customers seeking brands that tailor their products and services to their behaviors. When done correctly, loyalty programs not only respond to that need, but can generate over 20% of a company’s profits, according to McKinsey.
Retailers across the board – from larger names like Target and Nordstrom to standalone brands like Nike – are revamping their traditional spend-and-reward offerings to add layers of digital that respond to the modern consumer.
From tapping into an engaged community and encouraging gamified behavior, to pushing personalized spending in-store, here we highlight some of the most innovative loyalty approaches:
One of the cornerstones of the Victoria’s Secret’s PINK brand, is its college ambassador program, which recruits university students across the country representatives. The role is not too dissimilar from a social media influencer, with responsibilities including promoting the brand on social, offering followers advice and organizing campus events and get-togethers. Ambassadors dedicate up to 10-hours a week to their roles for free, and see this as an opportunity to build a personal brand with PINK’s support.
The brand’s loyalty program, PINK NATION, has also received an upgrade and launched its very first app, aiming to emulate a girl’s club. This includes exclusive member perks as well as a dedicated Campus tab where customers can chat with ambassadors. Ultimately, the brand wants to scale to include more college-life related content.
Flipkart-owned fashion retailer Myntra also took a similar crowdsourced approach to loyalty when it launched the Shopping Groups feature in 2017, in the run-up to its End Of Reason Sale (otherwise known as EORS). Shoppers could team up with their friends and families on the platform to shopping groups, where all purchases were tallied together to unlock further special discounts for the whole group.
The retailer reported almost 100,000 shopping groups being formed during the sale as a result, contributing to around 18% of sales.
Starbucks boasts one of the most successful retail apps to date with 23.5m active users. In order to encourage loyalty and get more customers to join its booming loyalty program that sits alongside (15m users), it launched a gamification experience called the Summer Game Boardwalk this year.
Anyone could play the virtual board game, which prompted users to tap a spinner and advance steps in order to tally points, similar to a game of Monopoly. At the end, loyalty members received points towards their accounts, while general app users were prompted to join the program in order to receive the same.
Meanwhile this year NikePlus added a number of interactive experiences for its members, extending the remit of physical activity into wider lifestyles. Nike collaborated with three key partners to do so – Apple Music, mindfulness app Headspace, and gym booking app ClassPass, to encourage consumers to be active in order to receive more rewards. For example, if the user completed and logged a workout within the app, it would unlock free Apple Music playlists.
With this program, the sportswear brand is hoping to triple its 100m user membership number.
DRIVING IN-STORE ENGAGEMENT
According to research company Bond, 95% of loyalty members want to engage with brands via new technologies. In-store, deploying digital tools is an opportunity for brands to engage and acquire new loyal customers at the point of sale, when demand is at its highest.
At Coty-owned make up brand Philosophy’s flagship in Manhattan, loyal customers are recognized and rewarded via facial recognition. Upon entering the store, customers are asked to take a selfie with their own phones and send it to a designated phone number. Registered customers can then be recognized on screens, which offers them special discounts. Over time, customers are pushed more tailored notifications and one-to-one consultants based on previous behavior.
Also in New York, is Nordstrom’s new menswear store, which is offering a higher level of service for its newly revamped Nordy Club loyalty program members. Customers shopping online can receive items to then try-on at that specific location. When physically approaching the store, customers receive an app notification giving them precise information on the location of their reserved item.
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