There is a change in consumer behavior due to the upsweep of digital influences in our daily life. The upcoming generations care about things which are not even a familiar thing to decision-makers nowadays. Companies need to revamp their customer loyalty programs to keep up with their future customers. To help you out, here are some insights to guide you through this process.
First things first, what are differences in value? Over the last couple of years, people are spending more and more time on their phones and other digital devices during the day. This has its pros and cons. People are way easier to reach than before. Although, the chance of noise is higher due to the endless content and information.
It is the company’s task to minimize noise and optimize the reach. The current consumer is inundated with direct pop-up messages when visiting websites. Companies can easily establish their brand because the barriers are rarely there. For that reason, customers have a wide variety of options. So, it is not necessarily that there is a whole different customer, but it is very easy to just try something new. The market is changing, not the customer. This is a common misunderstanding amongst companies. The values of the customer are moving with them but the environment around the customer is developing more rapidly. That is the main influence on the change in behavior.
The penny has dropped that decisions need to be made to respond to the changing customer. But, how to keep that changed loyalty program effective? A tool that can help is predictive analytics. There are endless options and data which can be anticipated and measured with this tool, including the different types of consumers, how much they are spending, and how valuable they are to you, just to name a few. This gives you the opportunity to sort them by value and to decide which customer you want to focus on.
Based on Harvard Business School, when a company’s customer loyalty increases with 5%, the overall profit can surge between 25% to 90%. The importance of investing in customer loyalty is, for that reason, huge. Besides the profit, another benefit of loyal customers is free marketing. Loyal customers are in the first-place walking on air when talking about your company. They express their feelings and values to their friends, family members or colleagues which will save you time and money with the customer acquisition process. Social media has had a big impact on this because anyone with a digital device can be an ambassador for your company.
There is a lot of irony when reflecting on the customer loyalty programs nowadays namely it is not focused on loyalty at all. Companies are more pushing on economic deals rather than creating a strong brand identity. True loyalty is based on emotion, not on finance. People have to feel like they are part of a family and are involved in a community. Bits of Stock gives the floor to your customer by passing by a fraction of ownership. An emotional, and even psychological, connection is being made because a share is worth a thousand words.