Now that Hema also has a customer card, it is clear to many retailers. They also need the loyalty card. Because loyal customers spend more. But before you go along with the trend, it is wise to think. Why actually offer that loyalty card? Because your customer has enough arguments against the customer card.
With ten different customer cards, your wallet can quickly become an inch deeper. And many loyalty cards do not give you anything as a customer: loyalty points that are worth less every year (Airmiles?) Or just a discount that you simply get at another store without compromising your privacy data. Because that is one of the main reasons for retailers to opt for a loyalty program: insight into customer behavior. You can use it to personalize and improve your marketing. But you have to offer the necessary for that.
Ask your customers: why do you buy from me and not from someone else? If they price not just name things like accessibility, quality, assortment or service, only then will you have loyal customers. Because customer loyalty means: despite a better price elsewhere, I will continue to buy from you. For that you have to offer real value. Some retailers find that difficult: customers always want the cheapest? No. They want the best price / quality ratio. That is why, in addition to a Lidl, there is also an AH and besides an Action there is also a Bijenkorf. And coincidentally, AH and Bijenkorf both have a loyalty card. How does that work?
Exchange data for value
With the AVG, privacy is firmly on the agenda. And it will be insisted on with the upcoming e-privacy regulation next year. An important point of attention for companies with regard to privacy is that it concerns permission. Because according to the Data & Privacy Survey from SDL, customers have no trouble making their personal information available. As long as it is clear what happens to it. And that is precisely the condition that the AVG now sets for the collection and use of personal data.
The value that you can offer via a customer card depends on each company and application. There are three levels at which you can offer value: rational, emotional and structural. For example, for a clothing store:
- Rational: % discount on the purchase, cheapest item of three free, save for a free belt ... basically just covert sales promotion. It is about financial benefits.
- Emotional: exclusive fashion show for loyal customers, early bird access to new collection, gamification, personal clothing advice, unsolicited surprises ... things that cost money but have more of an emotional value for customers. Many retailers already do this from themselves with good customers with whom they feel a relationship.
- Structural: free item under x euro with 9 stamps, a monthly discount that increases per purchase or spent amount, an extra discount or gift for customers who actively use the customer card for x years.
In practice, these three are alternated. Take a look in your own wallet: what does the customer card yield? Which offer benefits and which loyalty card will make you happy?
Go for emotion
The definition of customer loyalty is not logical. It is despite a lower price elsewhere. Emotion plays an essential role in customer preference and customer loyalty. It smells so good. Or: I feel involved with their charity in Brazil.
If you want to promote customer loyalty, think carefully about the positive emotions that your company and products evoke. Take a look at the emotions that your competition colleagues can point out. Nostalgia for example, works very well to bind a customer group to you for a long time (years). There is also a handy list for this, provided by the self-determination theory of Deci and Ryan who developed a comprehensive motivation theory.
Why motivation? Easy. Information makes you think, but emotion sets you in motion. If you investigate people's motivation, then you are actually investigating what emotions and feelings people make things take. Again for a clothing store viewed:
- Autonomy: we like to be in control. We want a choice (but not too much), register ourselves for a customer card, and choose our own reward.
- Competence: we like to be good at something. In smart saving with neighbors or friends and bringing in extra loyalty points via 'soft' promotions such as sharing on social media. Gamification responds well to this. Grab those points!
- Social connectedness: together we are happy to be one. You are more involved with the same core values, even when it concerns a company. If you think sustainability is a thing for a shopper, you only buy at a clothing store with sustainable brands.
- Progress: we are happy to move forward. More purchases must therefore result in higher levels with higher rewards. Therefore, also immediately give away points when you register for your customer card.
- Targeting: save for that beautiful jacket. Or exclusive early bird access with a discount to that fall fashion show.
If you connect these points, you will get something like this: become a member, get a discount and exclusive access. You can also donate your loyalty points to a joint charity.
Start customer card: to app or not to app
Do you now know when your customer would be happy with your customer card? Then you may be wondering: do I have to buy an app or have it developed or order customer cards or own one card printer to buy? Start with the customer first and ensure real added value. Then ask yourself: in what form do I make my customers happy? Are they seasoned shoppers who participate in so many savings programs that an app works best? Or, are it precisely baby boomers who simply prefer a pass and who otherwise want to be able to give their name loudly in the store?
Ideally, you do a digital loyalty card and a pass. Offer the choice. Don't be rigid. Because otherwise you get a hassle with empty smartphones and forgotten cards. Not only with a loyalty card but actually always applies: be customer-friendly. And be happy when your regular customer makes an effort to enter into a further bond with your company. Exactly as the Hema does with the Hema customer card:
- Two thirds chose the (paid) customer card, one third chose the app.
- The majority of users are under 50.
- You save points for extra discount
- Special offers
- Free tompouce for your birthday
- Your first 25 points as a gift after registration.
Do you recognize the motivation points and level of loyalty? Then you can think for your company how a customer card makes your customers happy.