What makes for a successful loyalty scheme?
There are many reasons why customers regularly shop from a given retailer. The concept of loyalty might boil down to product availability (which has recently been sorely tested by supply chain issues), or convenience, particularly in the grocery sector.
At the same time, other factors like value for money, emotional connection, and personalisation can also act as motivation for repeat purchases, ultimately helping retailers build connections with consumers – as well as that all-important set of data insights.
Loyalty programs aren’t right for all retailers either, of course. Return on investment is imperative, and heavy discounts can in some cases undercut margins. Equally, customers can turn away from loyalty programs due to a lack of perceived value – or even because they don’t like the prospect of offering up their personal information. Many people posit that loyalty within retail and particularly grocery does not truly exist, and that loyalty programs are more aligned with effective marketing (thereby helping to improve brand penetration, rather than real customer loyalty).
So, how can retailers get the balance right? Here’s a look at what makes for a successful loyalty scheme in 2022, and what retailers are doing in their attempts to win customers back. |
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