Loyalty Programs in an Omnichannel World

By Gerard Szatvanyi On Jun 26, 2019

More than ever, consumers demand a fast, seamless and flexible shopping experience. They want to maintain their preferences across all channels—web, mobile, and within a physical store – and they want the perks of their loyalty programs no matter the shopping experience they choose. A recent survey from Boston Retail Partners found that 87 percent of consumers are interested in a personalized and consistent experience across channels.

By now, most retailers and brands are on board with loyalty programs and even have a successful one implemented. However, as consumer shopping habits evolve and their demands become more complex, loyalty programs need to be adjusted to compete in an omnichannel world.

Set the Right Foundation

Retailers and brands can no longer separate the physical channel from e-commerce, they need to become customer-centric and develop a unified approach. This strategy will help to ensure that every interaction a customer has with a brand is enjoyable, engaging and memorable.

However, this is easier said than done. According to Salesforce, the average retailer uses 39 disparate systems to manage the customer relationship. Each system is pulling in essential data in the customer lifecycle. Without an integration solution in place, this can paint a picture of the customer that is disjointed.

Today, retailers need to incorporate a customer-centric solution that consolidates all customer data across channels. By breaking down the silos of information, organizations ensure a 360-degree view of the consumer. This also confirms they are individualizing the shopping journey from the online website to the physical store.

Give the Loyal Treatment

Historically, loyalty programs were solely focused on points as they relate to sales. With an omnichannel approach, companies can leverage tailored marketing, service and sales opportunities to accompany and reward a shopper through the entire lifecycle.

For example, Kiehl’s recently went through an overhaul of its loyalty program. It implemented technology to track its customers’ behavior and segment its database to help to enhance and personalize all interactions with its clients.

The brand’s rewards program offers four tiers of membership and an evolving number and quality of benefits available for each level. Once enrolled in the loyalty program, customers can earn points for purchases made in-store or online, request a skincare consultation, refer a friend and share purchased items on social media. The program enables Kiehl’s to reward returning customers with an assortment of gifts and benefits that show the brand’s appreciation of its most loyal shoppers.

With the new program, Kiehl’s can increase the average order value, boost customer engagement, improve customer retention rates and connect with customers on a deeper level.

Looking Ahead

We aren’t far from a completely seamless online and offline shopping experience, which presents an even greater opportunity for loyalty programs. By arming employees with devices, store associates will easily be able to pull up customer information in-store.

Consider this, an employee in a cosmetics store would have the ability to see that a customer he greeted in the store abandoned a beauty blender in her online shopping cart. After she’s had a chance to gather some products she’d like to test in the store, the associate could do a make-up trial and use the abandoned blender to show the quality of the product. Even better, since the associate is aware that her order value grows if she is offered a discount, he gives her a 10 percent off coupon to be used in the store that day.

As you can expect, a single view of the customer is essential in this loyalty scenario. It allows the associate to understand who the customer is on a deeper level and serve them across a variety of touchpoints.

According to Boston Retail Partners, 68 percent of consumers would choose a store that provides personalized/discounts over a store that doesn’t offer them. Therefore, personalization is yet another crucial aspect of a current loyalty program. Personalization should not be compromised as the customer moves from channel to channel.

Lastly, loyalty programs will incorporate AI and Machine Learning. These solutions will allow retailers and brands to extrapolate insights from data faster than ever before. With the power of AI and Machine Learning, employees are armed with more relevant recommendations for their customers than ever before.

Loyalty programs have already begun to evolve beyond the standard points system to keep up with new consumer demands. Salesforce states that 66 percent of consumers are likely to switch brands if they are treated like a number instead of an individual. Retailers need to ensure they are adapting their loyalty programs to incorporate a centralized view of the customer to deliver a more personalized experience both online and offline.