The customers overall commitment to the brand or service, in part because of an emotional attachment to that relationship, and the consistency of the brand that ensures an elite level of trust between the brand and the consumer.

1. Loyalty Programs
Strategies for Developing Customer Retention
William M. Clarke
Strategic Communications Professional
March 12, 2011

2. Customer Retention
“Smart companies have realized that customer loyalty is the most powerful
sales and marketing tool that they have.”
Bill Price, DRIVA Solutions

3. Customer Loyalty
The customers overall commitment to the brand or service, in part because of an
emotional attachment to that relationship, and the consistency of the brand that
ensures an elite level of trust between the brand and the consumer.
Customer Brand Loyalty

4. Customer Retention

5. Customer Loyalty: WIIFM
VALUE
QUALITY
Customer
Service
Design
Innovation
Trend
Setting

6. Customer loyalty is a four letter
word?
MORE

7. Customer Loyalty
82.4%
of consumers are more likely to shop at a company
that offered a Loyalty Program.

8. Consumer Brand Loyalties Strategies
• Brand Buzz - ignite your brand and create a cultural experience.
• Customer experience - offer customer service beyond the norm.
• Consistency - whether its on the web or face-to face (buying process).
• Employee Ambassadors – protecting the brand, while serving customers as
friends.
• Atmosphere of Trust – Align with your customers, be honest, educate,
serve their needs, and deliver quality at a reasonable price.

9. Uniquely understand your audience.

10. How they buy, what they buy, and where they buy?

11. US Corporations lose 50% of their customers every five years.

12. The average company has a customer defection rate of 10%-30% yearly.

13. 75% of customers belong to at least one loyalty program.

14. 48.9% of baby boomers said they would opt out of a loyalty
program that was too complicated.

15. Raising your customer retention by 5% can increase the lifetime value of your
average customer by 25% – 100%.

16. 60% of Millennial buyers said that they are loyal to brands.

17. 43% of Millennials admitted to using the same brands as their parents!

18. 50% of Millennials proclaim that price is the most important attribute in the
purchasing decision.

19. Cart abandonment averages 75.6% for US companies with online e-stores!
Are Loyalty Program customers more likely to cash out anticipating
their rewards/points?

20. 75% prefer a company that is socially responsible, and gives back to society.

21. Female Millennials tend to be unimpressed with logos and are increasingly
interested in unbranded goods.

22. Millennials will gladly skip the brand names for the better priced fashion items.

23. Loyalty Programs: Deliverables
• Easy to join - utilize an email address as a quick start sign-up in store or online, let
the customer add additional information later.
• Easy to earn - simple point system, avoid upfront fee’s, (Keep it Simple Stupid-
KISS)
• Gamified - fun and interesting
• Attainable - remember WIIFM, make sure the customer can actually achieve a
discount, coupon, freebies, etc. Programs should be short on rules, and long on
customer benefits.

24. 65.3% of Gen Xer’s have dropped a brand loyalty program in which the
rewards were not that compelling!

25. 38% Gen Xer’s say they will stick with a brand when they find one that they like.

26. Loyalty Programs: Winning Ingredients
• Communication, it’s a two way street, engage, listen, and respond –
develop strong alliances through social media interaction.
• Collaboration, make the relationship a partnership, understand the
customers needs, design products that meet their expectations and
desires.
• Exceed expectations, be an advocate for customer – provide product
quality, outstanding service, mutual respect, and reasonable pricing.
• Research, understand the uniqueness of your customers, define the needs
of specific channels, anticipate trends and satisfy market demands.

27. 47% of Gen Xer’s said they share brand opinions and brand preference
with friends and family.

28. Generation X is the most influential generation with regard to brand
opinions.

29. Gen X spends 37.4 hours per month online, more than Millennial's or Baby
Boomers.

30. Loyalty Program: Best Practices
• App based programs are preferred by Gen X & Y, these are easily
downloaded and maintained by customer, allow for easy use and
access to discounts, credit cards can be loaded to accounts for quick
purchases. Although, Apps can be expensive to develop, but we are
looking for lifetime relationships so the initial cost should override
that concern.
• Loyalty cards are another option (maintain the card info within your
CRM in the cloud), but they can be quirky – customers lose cards,
they forget them, etc. – these issues can make using the card a hassle
(not customer friendly in so many ways). But it’s a start - so get
going!

31. Loyalty Programs: Best Practices
• Data Collection, ultimately Loyalty Programs help you collect and retain
data with regard to your customer base. What you do with this data is
essential to your future success, make sure you can access the data, that its
easily integrated within your CMS, CRM, and IT services. Data helps you
understand the customer likes, dislikes, trends, competitive market, and so
much more – not only will you gain an understanding of what your
customer wants 6 months from today, but also what they will want in 5
years - and remember - this is about lifetime retention.
• Exclusivity, make your loyalty program part of the customer experience -
part of a special relationship between brand and buyer - guide employees
and their attitudes toward developing those bonds with the customer. The
internal team (employees) should uniquely understand the external
messaging that must be delivered effectively to your audience.

32. Loyalty Programs: Best Practices
• Measurement, look at the results of your program – was it an
effective revenue producer and brand development tool?- and of
course think about the ROI.
• Evaluate, some include evaluation with measurement but realistically
this is a separate deliverable. Review your loyalty program at six
months, then at twelve months, and continue to do so yearly. Don’t
let it become stale, keep it competitive with the competition, and
make sure it evolves with your business and the market in general.
Decide what works or what may work moving forward, align it with
new products or services, and make the program a constant “work-in-
progress.”

33. Loyalty Programs: Negative Myths
“Apple has never offered a loyalty program”
Guess what?
“You’re not Apple”

34. Get closer than ever to your customers. So close that you tell them what they need well
before they realize it themselves.”
– Steve Jobs

35. Loyalty Programs: Potential Results
• Increase revenue
• Enhance relationships with current customer base - bond
• Develop relationships with new customers - introduce
• Ignite an internal – external buzz between the employee ambassador and
the consumer
• Understand customers needs, wants, etc.
• Energize the power of the brand, increase brand awareness
• Feel the love, customers will love you and tell their friends (W-O-M)

36. Loyalty Programs
Contact information:
William M Clarke
@wilclarke77
wilclarke77@gmail.com
Good luck!