The Easy Way To Test-Start A Customer Loyalty Program

There are times when brands don’t want to dive 100% into loyalty programs. Research shows that loyalty programs help companies increase market share, sales, and profitability.

But when faced with the in-depth process of designing, creating, and executing a loyalty program - combined with hearing accounts of failed loyalty programs - brands can be hesitant to jump headfirst into launching a full-fledged loyalty program without at least testing the waters first. 

Which is totally fine! Building a business case for a loyalty program requires understanding several key factors, like program structure and setup, rewards options, points allocation, and more. It's a good idea to put time, research, and data into determining what type of loyalty program design and strategy works best for how your brand operates, your customer base, your industry, and your products.  Building strong customer loyalty takes a long-term commitment, so you want to set yourself up for success from the start. 

At Brandmovers we use a specific strategy for helping brands explore whether they're ready for a full-fledged customer loyalty program or not. This method allows clients to test-drive what having a loyalty program would be like and helps them as they begin to research options and gather customer data and feedback.

It works very simply. If you’re looking to: 

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

Then you can run an ongoing promotions program utilizing sweepstakes, contests, or even a simple receipt validation promotion, to do all the above. 

Why Use Digital Promotions? 

The most common perception of promotions like sweepstakes or contests is that they’re used to drum up customer attention or give away prizes. However, they also share several similarities with loyalty programs. 

• Some promotions require customers to register or create an account to enter
• Customers earn rewards for taking a specific action, like posting on social media, playing a game, or purchasing a product 
• One type of entry mechanism is letting participants submit a receipt or proof of purchase 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 - comprise the basic functionality of a typical customer loyalty program. 

Of course, there are major differences between the two. Promotions like sweepstakes, instant wins, and contests have strict federal 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.

Understanding The Benefits

The similarities between the two make promotions an excellent method for “test-driving” a loyalty program. You can see how your brand team handles program execution in its entirety: from designing the promotion and determining prize amounts and allocations to handling customer service and fulfillment afterward.  

You can also evaluate the reactions of your customer base - did you get high levels of consumer interest and participation? Were customers open to creating accounts and submitting personal data for a chance to win? Did your participants seem to enjoy engaging with your brand and have positive reactions to the rewards and prizes you provided? 

This can sound very trivial when laid out step-by-step. Of course, customers would enjoy winning prizes, but who doesn’t?

But remember the point is to test both brand and consumer interest in an eventual loyalty program. If your brand decides to start a customer loyalty program, some of the actions you'll need to take to drive customer engagement and loyalty program participation are:

• Attract customer attention and incentivize them to sign up 
• Provide transactional and non-transactional point-earning opportunities, such as making a purchase, following and interacting with brand social media accounts, or writing product reviews 
• Give members a loyalty platform where they can create accounts, view their points total, and track their progress 
• Curate a customer rewards catalog with products and items your customers will enjoy 
• Track, collect, and analyze loyalty 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? 

Taking The Next Step

What if your brand has already run sweepstakes or contests before and you want to explore the next level of creating a customer loyalty program?

If you had positive customer responses to past promotions, your next move could be to expand into longer, more involved campaigns.

Instead of hosting a one-time promotion, you establish an ongoing series of campaigns that allows registered customers more chances to earn and accumulate more rewards or points on a rolling basis. For example, customers can receive rewards for participating in brand-specific events or activities and engaging with brand content, such as videos, polls, and referrals.

The purpose of enabling customers to participate and earn rewards on an ongoing basis is to motivate them to keep returning to your brand, which is one of the foundation stones leading to real customer loyalty. Additionally, this process helps to attract and gather the individuals who will eventually become your loyalty program customer community of advocates, influencers, and brand ambassadors. All before you even build a full-scale, omnichannel loyalty platform experience. 

Grow And Scaling To Success

When it comes to building long-lasting customer loyalty, there’s no quick turnaround. Long-term loyalty takes long-term dedication. But that doesn't mean your only choices are to go all-in on a full-scale customer loyalty program or nothing. 

Part of our expertise at Brandmovers is helping companies create scalable solutions that can be easily expanded as your customer participation and loyalty program activity naturally grow. Using our modular loyalty platform software companies can start with the loyalty program features and functionalities they want, and then continue adding new functionalities and integrations in later phases -- without requiring a complete loyalty platform overhaul and rebuild. 

A slow-build approach to developing customer loyalty programs certainly isn't 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 wants to explore starting a loyalty program or improve its existing program, Brandmovers is here to help! Reach out to us today