on June 11, 2020 Loyalty

The Easy Way To Test-Start A Loyalty Program

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There are times when brands don’t want to dive 100% into loyalty programs. Research shows that loyalty programs help companies increase market share, increased sales, and more profitability. But there are times when the complexity of creating and executing a loyalty program, along with the stories of failed loyalty programs, makes brands hesitate to start their own programs. 

Which is totally fine! Building long-term loyalty takes a long term commitment. Part of building a business case for a loyalty program requires understanding several key items, like program build, rewards options, points allocation and more. 

At Brandmovers we use a specific strategy for helping brands as they decided whether they're ready for a loyalty program or not. It lets them test-drive what having a loyalty program would be like and helps them as they begin to research options and gather customer data. It works very simply. If you’re looking to: 

  • Test your customer base’s reaction to a new loyalty program
  • Gather customer info for an enrollment campaign push 
  • Explore new engagement techniques for your existing customer base

Then you can utilize digital promotions, like sweepstakes or contests, to do all the above! 

While the most common perception of promotions like sweepstakes or contests is that they’re used to get customer attention or give away prizes, they also share a number of similarities with a loyalty program. 

  • Some promotions require customers to register or create an account
  • Customers take a specific action, like posting on social media, playing a game, or purchasing a product to potentially receive a reward 
  • A type of entry mechanism is letting entrants to submit receipts for an entry
  • Prizes or rewards are fulfilled at the end of the promotion
  • Promotions give measurable program data and let you track metrics and KPIs 

All of these features - account registration, receipt validation, rewards fulfillment, and analytics - form the basic functionality of loyalty programs!

Of course there are major differences between the two. Promotions like sweepstakes, instant wins, and contests have their own set of strict laws and guidelines that brands must follow. Actual loyalty programs are more structured and sophisticated, with features like tiers, member benefits, and in-depth processes for earning and redeeming points. However the similarities between promotions and loyalty programs makes promotions an excellent method for “test-driving” a loyalty program. You can see how your brand team handles program execution, from designing the promotion, determining prizes, and handling customer service and fulfillment afterwards.  

You can also evaluate the reactions of your customer base - did you get a lot of consumer interest or high levels of participation? Did customers seem to enjoy the brand engagement and opportunities to win? Were they excited or have positive reactions to the rewards and prizes you provided? 

This can sound very trivial and unnecessary when laid out step-by-step -- of course customers would enjoy winning prizes, who doesn’t?! But remember the point is to test both brand and consumer interest in an eventual loyalty program. After all, if you do decide to start a loyalty program, part of what you’ll need to do is:

  • Attract customer attention and incentivize them to sign-up 
  • Provide point earning opportunities, which can be anything from making a purchase, to following and interacting with brand social media accounts, or writing a product review 
  • Give members a platform where they can create accounts to view their points total and track their progress 
  • Curate a rewards catalog with products and items your customers will enjoy 
  • Track, collect, and analyze program data to measure success and implement improvements
  • Provide additional activities such as games or challenges, customer surveys or polls, or member events to retain customer interest and engagement

See the similarities? 

Additionally, if you’ve run sweepstakes or contests before and you had positive responses, then you can always move up into more involved campaigns. One method is allowing registered customers chances to earn certain rewards or points for participating in brand-specific activities and engaging with brand content, such as videos, polls, and referrals. This lets you further develop a loyalty community before you evolve into a fully developed, omni-channel loyalty platform experience. 

When it comes to building true customer loyalty, there’s no quick turn around. Long-term loyalty takes long-term efforts. To go along that line, a slow-build approach to developing customer loyalty isn’t always the wrong way to go. There are numerous methods to test-drive loyalty programs no matter your brand or industry, and cultivating a solid customer base is a key aspect of every successful loyalty program. All you need to do is get started. 

If your brand is wanting to explore starting a loyalty program or looking to run a digital promotion of some type, reach out to us today! We'd be happy to help.