If you're running a loyalty program, one rule to always follow is this: loyalty programs should never be stagnant.
Following a "set-it-and-forget-it" approach to managing a loyalty program is actually one of the top reasons some loyalty programs fail. Loyalty programs that are left to run on auto-pilot after launch can miss out on some vital opportunities, such as the ability to make key improvements or engaging customers with new, exciting initiatives. The best way to continue building on your loyalty program's initial success and to eliminate any weak points over time is to constantly be measuring, evaluating, and optimizing your program after post-launch.
As you go through the process of growing your loyalty program, there will be times when program optimization requires changes. These changes could affect a range of areas: from modifying what reward categories are available, to a full-overhaul of how members engage with the program to earn and redeem points. If you intend to implement changes of any type or level to your loyalty program, you will have a better response and easier acceptance among your audiences by following these steps to communicate the changes properly to your loyalty program members.
Before You Start
Let's cover one topic before we get into the ‘how-tos’: changes to a loyalty program are never 100% accepted by the entire member base. Some people might argue that any changes (big and small) aren’t normally accepted by even a majority of members. Just look at the outcry that goes up when Netflix announces a particular show or program will be leaving the platform.
If your planned program changes include big adjustments that affect customer standings or available benefits, there’s a high possibility you’ll experience a negative backlash from your members. Consider the situation from a psychology standpoint; the fear of loss (which is a major human motivator) and the ownership effect (where people place a higher value on the things they have) means changes to your loyalty program that are perceived as detrimental to users can have a major emotional impact on your program members.
Because of this (and many other reasons) it’s important to ensure that any changes or modifications to your existing program are 1) focused on improving the loyalty experience as a whole, and 2) you communicate this core message to your program members. Any program changes should always be implemented in order to create a better, more valuable customer experience; not on a whim or to follow a fad. Keeping this in mind will help you as you prepare to inform your loyalty program members about future changes to their program.
Best Practices For Communicating Loyalty Program Changes
Always Provide A Heads Up
Surprises can be fun, but not everyone loves them. If you try to surprise your customers by launching major changes to their loyalty program without any type of announcement, more than likely your customers’ reactions will be more alarmed or concerned rather than delighted. This is why it’s important to give program members advanced notice that changes are in the works.
It is an immensely better option than springing the changes on them without any warning. By not providing advance notice, you might inadvertently indicate that you don’t care how these changes affect your program members. This in turn can cause your members to react with confusion, anger, and frustration and potentially damage your relationship with them.
Taking the effort to communicate changes to your customers can go a long way to keeping their loyalty. It shows you're taking into consideration their feelings and potential needs, which also helps to demonstrate how you respect and value their relationship with your brand. Even if the change is super simple - say, the title of the monthly program newsletter is switching to something else - you should still send out some type of a notice to let customers know.
Be Sure To Provide Enough Of A Head’s Up
The next step beyond providing a head's up is getting the timing of your head's up correct. You should always make sure to incorporate enough time between the change announcement and the date when the changes will go into effect. Remember, the core reason for sending out announcements is so customers are able to adjust however they need; you want to make sure they have enough time to do so.
The amount of time will depend on what kind of changes you’re making to your loyalty program: if it's a minor change that requires no actions on the customer’s side, then the time period can be shorter. On the other hand, if the change will require some form of action from your program members (such as updating their information or using up a certain amount of points before a cut-off date) then you need to give them ample amount of time to respond. While you should always try to minimize any burdens on your program members, there may be times when it is just inevitable.
Announcing the changes far in advance, sending regular reminders, and letting program members have enough time to adjust will help to minimize any frustration or anger on their part.
Help Program Members Find More Information
As with any changes or updates to a program, inevitably your audience will have questions. These questions could come from a variety of sources: from regular participants who want to know all the details, to customers who were absent for a while and logged back in only to find that things have changed. This is where having a decided FAQ, Help section, or News section on your loyalty program’s site comes in handy. These FAQs or Help sections can proactively answer customer questions and help mitigate any confusion.
If you don’t currently have an FAQ or Help section, you should strongly consider adding one even if you’re not planning to make any changes to your loyalty program. If you do have a FAQ or Help section, don’t be shy about promoting these areas of your site. At minimum you should ensure that these areas are easy to find and access. In some instances you can even direct customers straight to these information centers based on certain criteria.
For example, let's say a loyalty program member who hasn’t been active for a specific amount of time recently logs in to their account. You can create some type of notification specifically for this type of returning member, such as a pop-up alert or a system-triggered email with some version of the below messaging:
“Welcome back! You probably noticed that things look a little different. We’ve made some cool updates to our loyalty program to help make your experience even better - you can see the full list of the changes below. If you have any questions or want more information, be sure to visit our FAQs and dedicated Help page to get the details. Thank you for being a valued program member!”
Be sure to include links to the FAQ and Help pages in your messaging to make it easier for customers to find.
Brainstorm New FAQs
Speaking of FAQs, making changes to your program is a good opportunity to update your standing loyalty program Frequently Asked Questions. While smaller program changes might not require new FAQs, big changes definitely will, if only to answer the questions “Why has this changed?”, “How does this affect me?”, or “What do I need to do now?”
Keep in mind when planning or brainstorming new FAQs, it’s always good to get outside feedback from other team members in your organization. Why? Because everyone thinks and approaches things differently. You might not anticipate having a particular issue with a new program change, but someone with an outside perspective and different experiences might spot a potential complication immediately. That individual can then help you plan a response or plan of action.
Loyalty program changes are a good opportunity to reach out to your brand’s Customer Service or Help Desk teams. These are the team members who regularly interact with customers to fix issues and resolve conflicts; as such they’re familiar with the most common customer frustrations and problems. They can be invaluable for helping you proactively form FAQs and helpful responses to new program changes.
If The Change Is Serious, Tell Program Members Why
Customers are not dumb people. They know that when a brand makes a major change - drops a label, cancels a service or promotion, eliminates a feature, etc. - there is a reason why. In today’s environment brand trust matters more than ever for customers when choosing where to spend their money. Trust and respect for a brand is pivotal when creating loyalty customer relationships, and transparency is key to building trust.
So be as honest as you can about the changes you’re making. If you’re changing how point allocations for actions or rewards works, be sure to highlight the major reasons why and identify how the changes benefit program members. If you’re discontinuing a service then explain why that service is being removed, whether anything will be replacing it, and (as always) how this change benefits customers. Even if it’s because something went wrong, you can still explain how it wasn’t in your customers best interest for it to stay.
This is especially critical for any changes which might be considered negative. For example, let's say you decided to increase the number of points or amount of money a customer must spend to attain a specific VIP tier because VIP benefits cost more than lower-tier benefits. The stereotypical reason of “everything costs more these days” is not a good explanation you want to give your program members. However, explaining how increasing VIP member costs allows for exciting new VIP member benefits - such as more exclusive events, new promotion opportunities, VIP-only product releases, etc. - can help customers understand and accept your reasoning.
Good Communication Is Essential For Loyalty Programs
Changes to your loyalty program, both big or small, are inevitable. While change can be a good thing, it's important to communicate these changes to your loyalty program members. Like we’ve discussed before, the key to growing true customer loyalty is by focusing on building relationships and not transactions. As with any relationship, communication is crucial. No matter what type of changes you implement, following these best practices for communicating changes to your program members will help inspire more positive reactions and ensure your loyalty program continues to grow in success.
Modern customers want more from their loyalty programs; if you’re looking to do more with your loyalty strategy, we can help! Contact us today.