Guide to Mutual Pampering – Get to Know the User to Be Loved More

Banks, for example, offer rewards such as cashback to their customers who use debit and credit cards at certain retail chains or restaurants and if they choose specific categories of banking services. Frequent travelers are given additional points on the ticket price by airlines, which particularly benefits business people. Some companies also offer different spending tiers where customers can reach higher levels with benefits through larger purchases, while others allow for more points to be earned if two products are purchased instead of one…

To win new customers and delight existing ones, they design loyalty programs that reward customer loyalty to the brand. Brands thus give customers a reason to continue purchasing their products, as even 75 percent of customers’ purchasing decisions are based on their increasingly important personal experience, as shown by a report from American Zendesk, a customer service software company.

For Small and Large

The relationship with customers, their trust, and loyalty have always been an important segment in the business of every company, and in the new market circumstances due to the coronavirus crisis, they are a crucial factor in preserving business and maintaining a stable influx of revenue, said Bernarda Blažek, Director of International Business at Newton Research Europe. The loyalty program is, in her opinion, a sophisticated and subtle tool by which companies raise brand awareness, nurture relationships with customers, and create a unique image that distinguishes them from the competition and gives them an advantage over it. She is convinced that it is equally important for the user and the brand; if that is not the case, the program is misguided. The first step is research, or measuring satisfaction.

– The user must be ensured savings, rewards, special status, or benefits for their participation and time invested. The benefit for the company must be concrete to exceed the investment, and it is expressed in increased sales revenue, influx of new customers, and retention of existing ones. The loyalty program is not reserved only for large companies that can afford sophisticated technology for program implementation. In my experience working with clients in Croatia, companies of all sizes and different industries nurture relationships with customers and listen to their needs. Investments in customer research, especially in these crisis times, are not a cost but direct the best path in designing the offer, reduce misguided approaches to the customer, find new solutions, and bring in revenue – claims Blažek.

Pointless Umbrella

For Matej Sudar, co-owner and creative director of Factory, the goal of every business is to create loyal customers and attract new ones. As customers become increasingly demanding and are exposed to hundreds of competing ads daily, he says, it has never been more important to have a quality IT system that tracks every customer interaction and thus enables personalization.

– A quality IT system should be combined with zero-party data that users voluntarily leave with brands. Thus, the customer should be known in micro-interaction with them, for example, determining how much time they spend in a certain category. A survey should be conducted with the question ‘Are you willing to pay more for a product that has a longer warranty?’ and based on such data, create a personalized offer. Poor examples of loyalty programs are generic: free coffee or an umbrella, which do not create a connection with the brand and are not customer-focused, but sales-focused – believes Sudar.

The loyalty program for companies today is extremely important as the emphasis of business has shifted to the user, the customer, and the business results of companies depend on how much they know about their customers, how much they tailor their offer, and how much they listen to their needs, also believes Ernest Antolović, CEO of Digital Reality. Customers are inclined to give brands and retailers such data, but in return, they expect some benefits, he says.

– Repeat purchases do not have to be once a month; in some industries, it is only two or three times a year, even once a year. Such brands know well how difficult it is to acquire a new customer, so they are willing to invest to bring back existing ones. The loyalty program is a channel of communication with the customer that must have some advantages, but not necessarily in the form of discounts. For example, in the case of e-commerce, i.e., online shopping, it can be free shipping and/or returns, a gift with every order. Regular stores can reward customers with a free refreshing drink during the summer months or a cloth bag. When designing a loyalty program, the specificity of the industry, customer behavior, ways of collecting benefits, their duration, and ways of using them are important. The loyalty program provides a unique opportunity to directly ask customers for opinions and advice in surveys and customer interviews. The data obtained can be extremely valuable if processed correctly – states Antolović.

Lifestyle

Ivan Horvat, marketing manager and public relations officer at dm, agrees that loyalty programs are aimed at strengthening the trust relationship with customers within the information, rewarding, and engaging system in the company’s activities. In his opinion, a successful program should be simple and understandable. The dm loyalty program ‘dm active beauty’ is the result of long-term listening to customers and constantly adapting to their needs and habits.

– Members are enabled to track their points balance and all the benefits available to them through a smartphone app. The purpose of the loyalty program is to determine customer needs as accurately as possible and respond to them in a timely manner. Our program thus records a constant growth in the number of users: with over a million users of the ‘dm active beauty’ card, they achieved over 53 million kuna in discounts just in the past business year – says Horvat.

For Konzum, loyalty programs are a long-term process and a tool that helps customers recognize it as a retailer that values their loyalty to the brand and cares about their needs. Retailers compete daily with low prices and offers, follow trends, and the lifestyle of the modern customer who knows what they want, where to find it, and how to get the best shopping experience, they believe at Konzum.

– When creating a loyalty program, we primarily follow the lifestyle of the modern customer, but important social issues certainly come into play – they emphasized at Konzum.

{embed_digitalno_izdanje}{/embed_digitalno_izdanje}